With house prices at an all time high, here are some of the ways to try and bag a deal on the property market
Below market value (BMV) is a pretty self-explanatory property term. Essentially, it refers to properties which are on offer for a price deemed to be lower value than the overall market for such a property in that area.
This sounds like it could only be a good thing, but it’s important to note that there are two kinds of BMV properties: those with potential for profit and those that are BMV for a reason. So how do you tell the difference? And what can you do to snatch yourself a worthwhile BMV property?
We’re here to help with that. There are plenty of ways to find a property with a great price and even greater potential, but it involves being savvy and doing your research. Here are 5 ways to buy properties below market value.
Make sure it’s a good investment
Like we said, not all BMV properties are going to be buyable, some are that way for a reason. You need to look at all the factors involved such as location, build quality and any major issues with the property before you commit to it. You don’t want to purchase a property only to find that it has a recurrent damp issue or a structural concern which will cost thousands to fix. Therefore, it is advisable to look for newly built homes by reputed homebuilders (such as these custom home builders Kansas City) who can provide well-built houses at affordable rates. Likewise, you might find the most charming property in the countryside, but its rural location makes it difficult to find buyers or tenants. So, choosing your home’s location might also be crucial.
Auctions
Auctions are a great alternative to the traditional property market, giving you access to a range of different properties which would have otherwise passed you by. Many unique properties go to auction, including those in need of refurbishment or even just plots of land for a completely ground-up project. Auction purchases need to be completed much faster than normal house sales, so you’ll need to make sure you have the funds ready, but the bidding process could lead to a fantastic deal. Alternatively, if you are selling your property, you can hire a property auction manager from a firm like Connect UK Auctions to help you get the maximum possible price for your property.
Look for rental demand
If there’s no rental demand, there are no tenants, and if there are no tenants, there’s no rent. This means no profit. Be sure to do your research on sites like Zoopla and Rightmove, checking how many rental properties are currently on offer in the area and how often new adverts appear and old ones disappear. This should give you an idea of how in demand your potential property purchase would be.
Residential bridge loans
Speaking of having funds ready quickly, this is exactly what commercial and residential bridge loans are designed to do. Both commercial and residential bridging finance are short-term loans that give you fast and flexible funds. This, in a way, allows you to bridge the gap in your finances. Once you’ve made a profit on your property you can pay back your loan in no time. In case you are engulfed in the thought of how much will a bridging loan cost, then this post will likely fetch the answer to all or most of your queries.
Find motivated sellers
If you can find a property that the seller is desperate to get rid of, you might find yourself in a position to snap it up for a slightly lower offer. Sellers who have had their property on the market for a long time are often very motivated to sell as soon as possible, so try going on property sites like Zoopla and searching the ‘most recent’ listing, then flipping the results. The oldest listings on the site are most likely to be the ones that the sellers are most keen to sell on.