How to buy and sell property in Cardiff and profit

Mortgages Rise

Buying and selling property for profit

If you want to make a profit from buying and selling property also known as property flipping you need to follow certain rules.

What is Flipping?

This is buying property at low price and selling high, which is the same as most investments.

First you need to research the property market in the area you are interested in.

Cardiff area

If we take Cardiff as an example you need to look at the local areas and property types. For example, if you were looking at the Buy to Let Market you would first need to access the likely rents for certain areas.

Cardiff has Wales’ largest student accommodation market with Cardiff University having over 30,000 students, The University of South Wales has 25,000 students and the Cardiff Metropolitan University has over 11,000 students.

There has been a lot of purpose-built student accommodation built in Cardiff but comes nowhere near this number.

If looking at this market then houses within 10-to-15-minute walks of these universities in Areas such as Birchgrove, Llandaff, Cathays, and Roath would be worth looking at. HMOs (House in multiple occupation) can be very profitable and are known for providing much higher returns than the majority of single lets.

During these times of Covid HMOs have become less popular but can still produce good returns as things get back to normal.

If you want to make money quickly then property flipping offers a better return on your investment.

As a rule, you want to spend no more than 70% of the expected sale price of the property, which includes any repairs you need to do.

A great place to start looking is to use the big online property platforms such as Rightmove, Zoopla or Onthemarket. Whichever property platform you use firs select the areas you are interested in. This will depend on the budget you are looking at. For example, in Cardiff, if you select Lisvane as your area you are unlikely to get any properties under £400,000 other than a few flats or new build apartments which would be unsuitable for flipping.  If we move location a few miles to Whitchurch, which is still a popular area you have much more of a chance to find a good property you can flip. Normally we would recommend staying away from flats unless they are well below market value, as it is hard to increase the value by the 30% we need.

As an example if we search for 3 bed to 4 bed houses in this area, we get a good selection for under £400,000 When searching it also pays to select 2 “include Under Offer, Sold STC” which will show properties which are in the process of being sold.

This will give you a good ideas of the prices properties are going for in the area. Many at the lower end may require work to bring up to standard. You can compare the prices of property that require work with houses that have been refurbished.

You want to look for properties that need updating but not require a large amount of work. Many people are looking for properties that require no work and just want to move into a property.

This is the type of customer you want once you have your property.

Once you have selected 3 or 4 properties you are interested in, contact you estate agents selling the property to arrange a viewing. Before your visit confirm with the estate agents that the property is Freehold and not leasehold. If leasehold make sure there are more than 80 years left on the lease, otherwise you would need to buy the property for cash, as you will not be able to get a mortgage, which will further restrict your buyers, when you come to sell.

When you visit each property, it is a good idea to make small notes. First impressions count but having in mind to tidy up gardens, fences, or repaint a door does not cost that much. Make sure when you visit you get all the information you can.

Thinks to look out for

Damp

You want to make sure there is no damp, look for signs of flaky plaster or moldy smells. Make sure you look closely at ceilings and around skirting boards.

Structurally sound

Look for any large cracks in walls and around windows. Make sure doors close to ensure door frames have not moved. You are not a surveyor but you should still be able to spot any issues.

 Look at potential

Generally, just painting and decorating a property will not add significant value to a property as most people will do this anyway. It will however make the property sell quicker.  Kitchens and bathrooms can be replaced very quickly and do not cost a significant amount if done correctly. Are the rooms big enough or do you need to knock any walls down? This can add considerable time to any flip so you do not really want to do this unless you really have to.

Once you have selected the property you will have to make an offer on the property. Depending on how long the property has been on the market will generally dictate what offer you can make. If everything looks good an offer of 10% off the asking price and be OK.

Once your offer has been accepted you need to start the legal process.

Conveyancing

This is known as conveyancing. To get a good conveyancing quote you can now do it all online. Look for a conveyancing service that will give you an instant online quote. One such service in Cardiff is My Conveyancing Cardiff who will provide an instant quote. Also look for conveyancers who offer a No move No fee option so if the property purchase falls through, as long as it was not your fault you do not get charged.

You may also want to get a survey done by a professional property surveyor to give you peace of mind. It should be noted only around 20% of people get a survey. If you get a survey done you should budget around £300 to £900 depending on the level of survey you select.

Completion

On exchange of contracts, you are legally committed to proceed with buying the property.

You now will have the keys and you can get started on doing up the property.

It is vital you also have suitable house insurance in place

 Post Completion

The last part of the conveyancing process will be for your conveyancer or solicitor to arrange the payment of any stamp duty (if applicable) to the Revenue and Customs.

They will then also register you as the new legal owner of the property with the HM Land registry. You have 30 days to do this.

House flipping in Cardiff or any other area can be profitable if you purchase properties at the right price and in the right location. Popular places in Cardiff include Roath, Rhiwbina, Whitchurch, Cyncoed, Llandaff, Lisvane. Cardiff bay has also seen significant development but mostly Flats and Apartments.

Happy house flipping

Leave a Reply

Your email address will not be published.