Why Buying Below Market Value Properties is Pointless
In this weeks video Elaine is talking about how people seem to be infatuated with Below Market Value Properties and explains why there's no need.
People who want to buy Below Market Value Properties or Buy-to-let properties that need refurbishment, don't need to buy these specific sort of properties. Their main goal is to get money out when they remortgage a property.
The reason they don't need to buy these sort of properties is even if someone buys something below market value, when they come to refurbishing the property a surveyor may say as they brought the property for x-amount the is the current value.
Also someone may buy something for its current value and when they come to remortgage the property the area might have risen in value so their property would have gone up as well.
We are seeing in our system a lot of Buy-to-let properties that are in areas which are likely to rise in value in the next year or two, and these tend to be 10's. Some people ask what a 10 is on our system, and it could be any number of things. It could be something that is BMV, it could be something that is well priced but the area will go up in value. A property with a score of 10 from us could also be something that is priced lower than similar properties in the area as it needs refurbishment.
With properties that need refurbishing it is always worth checking to see if it is worthwhile in your budget as to whether you will get the profit you desire.
A lot of people are obsessed with buying a property that is smashed up or needs a lot of work doing to it as well so they can make a profit and make their money back. We have done main deals we we have only spend a couple of hundred pound on a property but still made 20/30% return, so it is not needed to buy something that needs lots of work doing to it.
The main point of buying a property like this is making sure when you come to take money out of it you are getting the return you want, not buying something BMV or needs refurbishing.