To reiterate from last month's article about my Top 10 Tips, I will have covered these Top 10, 'buying at auction' tips in the preceding series of articles that I have written for Property Investor News. Therefore, for those that have previously read all the articles, and possibly remembered most of the content, you will find some degree of repetition in this article, although, as I am not quoting from or re-reading my earlier articles, these Top 10 Tips are effectively new material.
Last month I expanded on Tips 1-4 which I summarise firstly:
1) Training is crucial and I recently did and reviewed for my own website (Property Investor Online), Kevin Wright's excellent 'Recycle Your Cash' workshop on 'Bridging Finance' which is particularly relevant to buying at auctions, whereas training on other important aspects of property investment may not have the same degree of relevance.
2) LCNP, (Location, Customer, Neighbourhood, Property). This is so important; get any aspect wrong or compromised and you can put your entire investment strategy at risk!
3) Research, and this applies to all aspects of LCNP, can't really be overdone, but beware of conflicts arising causing indecision and also make sure that you keep your research constantly under review and up to date. Property is a very live market and every aspect can be very volatile, ranging from prices & values through to locations & neighbourhoods down to street level. I remember, some years ago, discussing a low-cost street that was local to one of my students who commented that it was no-go because it was renowned as a red light area. I asked when was the last time the student had visited the street, to which he answered many years ago. I asked him to revisit and report, which he did, and the result was that there were no 'working girls' in the street or even the neighbourhood. Now, it might take time for the street to completely lose its historic reputation but lose it it will and when it does values will rise. The same applies to ex-local authority property becoming gentrified.
4) Cookie cutter. It's very important to develop a strategy which you understand, like and enjoy operating. Obviously the strategy has to be commercially viable but most strategies that you understand, like and enjoy will be commercially viable because there are others like you, who will also like what you produce. Remember, I like terraced housing as do many others. Also, like many other investors, I like white paint, upstairs bathrooms, showers, gas heating, tiled and carpeted floors, a warm, draught proof and light/bright home, which are just some of the aspects of my cookie cutter approach.
And now onto this month's remaining tips in more detail…