Buying an investment property for the first time can be quite intimidating. If you’ve done your homework and have a plan, everything should work out and you’ll find yourself with an investment that pays for itself – all while its value climb. Whether you’re purchasing to let or want an HMO, doing proper research before purchasing is a must. That makes sense – a plan will allow you to start getting a return on your investment as soon as possible.
Once you’ve done your research and created a plan, you’re ready to purchase a property. There is the regular way of doing that. You scour the papers or the web for properties for sale – maybe enlist the help of a realtor – view the properties and make a decision to either walk away or purchase. If you decide to purchase a property, you go through the steps of putting in an offer to purchase and hope that the sellers will accept your offer.
What about buying a property at auction? Homes Under the Hammer is one of the BBC’s most popular daytime TV program and is now in its 22nd series. This series makes it seem easy and fun and as long as you have done your research and you have control; it can be fun and easy. When you’re at an auction of any kind, there is a feeling of urgency to bid and that sense of urgency can see one be carried away in the moment, only to regret their actions later.
View the property before the auction. Arm yourself with all of the information about a property before even considering bidding on it. Due diligence is necessary to understand what house prices are like in the area and what the average rent is.
Decide on the highest price you’re willing to pay for a property and stick to it. It’s all too easy to get caught up in the excitement of the room and convince yourself the extra few pounds don’t matter. They do. You don’t want to wake-up the next morning, out of pocket and seeing your dream house transform into a nightmare before your eyes. Stick to your agreed price, regardless of how badly you want to purchase the property.
Always have your financing in place in advance. Once you’ve decided on your top bid for the highest priced property, ensure that you have the down payment in place (in your bank) and a pre-approved mortgage for that amount. You don’t want to be caught without this as it could lead to a high-interest mortgage or, worse still, losing your deposit if you’re unable to get financing. All of this background work with help you at an auction and you could find yourself winning a bid on a great investment.