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Secrets of Becoming a Property Millionaire

13 November 2017 No Comment

Property investment has long been a popular choice for those who are looking to make some extra cash. However, for those starting on their property investment journey, it can be hard to grasp how some people have managed to turn their dealings in property into being a millionaire. Read on to discover some of the secrets of becoming a property millionaire.

– Become a trainspotter – When you evaluate why property prices in certain areas have grown at a quicker rate than in other areas, you will usually find that this is down to one thing: improved rail links. When a new station is built, commute times are slashed, which makes the area particularly popular with young investors. However, you can’t simply wait until the station has been built to invest your money in the area. You need to be ahead of the game. This is why it is important to assess long-term transport plans so you can determine the areas that are going to benefit from improved rail links five years down the line.

– Don’t trust estate agents’ estimates of rental yields – Estate agents are likely to promise unrealistic rental yields. After all, they want you to purchase the property, and so they are going to make it sound as tempting as possible. This is why you need to do your own research and get genuine independent advice.

– Choose tenants with care – When looking for tenants, it is a good idea to target young professionals. Investing in premium-quality, low-cost shared accommodation tends to be the best way to go if you are seeking to pursue a high-income investment strategy. Converting a single-occupancy property into a multiple occupation building will result in great capital gains with the right tenants.

– Consider turnkey properties to get your foot straight on the ladder – Property investment can take a long time when you are handling everything yourself. This is why it is a good idea to consider turn key rental properties for investment. These properties are ready to be rented out straight away, meaning a lot of the hard work is eliminated.

– Make value-adding improvements to your home – If you are going to raise capital by selling your own home, you should make value-adding improvements first. This will give you a bigger kick-start on your property investment journey. If you have an extension built or a conversion completed by a professional, it can add around 20 per cent to the value of your home. This can make a massive difference when it comes to purchasing your first investment property.

– Work with people you can trust – You are going to need professional help along your journey. After all, it’s not like you are going to be able to handle everything from the DIY to the legal side and the financial aspects. You need to pick the right partners; those with expertise in their chosen field, and a reputation that you can trust. This is not only critical in ensuring you optimise your profits, but it is vital to give you peace of mind in what can sometimes be a stressful process.

– Start at home – Is your house currently far too big for you? If your once family home now has two empty bedrooms because your children have gone to university, why not break it up into two flats? You can keep one flat for yourself, and you can rent the other one out.

– Exploit local knowledge – It is not going to be easy to spot a bargain thousands of miles away. This is why it can often be beneficial to start off close to home. You will already have all of the important information regarding everything from transport to schools. You will also be able to keep an eye on your property, which can make it a lot easier to manage.

– Make sure you are operating tax efficiently – If you pay more to the taxman than you have to, you are never going to become a property millionaire. There are so many ways to lower your tax bill, so to achieve maximum capital growth, you are going to need to take advantage of them. Make sure you maximise savings from tax-deductible items, and divide your property portfolio tax-efficiently between you and your partner if you are married. Needless to say, you should only ever lower your taxes through legitimate means.

– Don’t put all of your eggs in one basket – You have probably heard of this saying before, and it definitely applies to property investment. A diverse property portfolio is going to be much more likely to weather any bad situations.

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