As most investments, investing in BMV property requires you to make preparations. Doing your homework now will pay off later. Rising property values in most markets combined with a lack of rental properties make finding the right BMV property to invest in a great investment solution.
If you are looking into a below market value property investment you should know that you will most likely face a substantial amount of legal and duty fees. If you plan to sell the property shortly after your purchase you will face other fees such as in example the selling commission of your real estate agent, any advertisings costs and capital gains tax. In general a rule of thumb is that you should count on paying anything from 5% to 7% of the property value as additional expenses.
If you want to buy below market value property as an investment and making profit on the sale of the property is your main goal, you should make sure that you keep these costs in mind before you buy a property because you have to deduct these costs from the selling price in order to figure out your net profit.
Because of these costs you should probably look at property investing as a long term investment. Naturally there are cases where you can flip properties within a considerable amount of time and earn anywhere from 2-3% up to 30% of the property’s value on your investment but you need to realise that these are chances you won’t come across often. A lot of good timing, research and a large dose of luck will be necessary to find the right BMV property deal.
If you have no luck finding the right below market value property investment it might be time to ask the experts at comparethefinancialmarkets.com for some help.
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