Property Investing Guide v3 - Shane Academy · 2018. 9. 22. · investing in a property. J ARG O N...
Transcript of Property Investing Guide v3 - Shane Academy · 2018. 9. 22. · investing in a property. J ARG O N...
PROPERTY INVESTING GUIDE
FOR BEGINNERS
WRITTEN BY
SHANE HINDOCHA
WWW .SHANEACADEMY .COM
www.shaneacademy.com
While property seems to be the go-to strategy
for safe, secure and stable investment, it is
surprising that people are willing to put down
huge amounts of money without knowing what
they are trying to achieve and how a property
investment is likely to perform.
"You can probably blindly buy a property in
England and as long as you can service your
debt, it is likely to make money over time. The
trick is, how do you shorten this period of time
in which money is made? How do you find
properties that are likely to go up in value
rapidly whilst simultaneously negotiating a
discount on these properties? That is the trick”
says Shane Hindocha, founder of Shane
Academy. “All you need is a process and a
system.”
INTRODUCTION
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UNDERSTAND YOUR LIMITATIONS
What is stopping you from progressing?
-Lack of capital? Well, you must learn how to
raise capital then.
-Lack of education? Learn how it all works.
-Lack of a network? Develop one.
-Lack of time? Build a reliable power team.
KNOWLEDGE
"Like most things in life, the more you know
about a subject, the better you're probably
going to do in it," says Shane.
It always starts with knowledge. You don’t
know what you don’t yet know. Investing in
yourself and having that knowledge could
save you or make you thousands of pounds
years into the future.
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RESEARCH Learn, develop and use a Due Diligence
process. Be strict with yourself. There are
certain things you MUST look for before
investing in a property.
JARGON Familiarise yourself with the various phrases
and abbreviations in the property investment
industry. There are 8 you MUST know.
CALCULATIONS Get acquainted with the popular and useful
calculations that are often used when
reviewing property investment deals. There
are 4 main calculations you should know at
the very least.
UNDERSTAND THE MARKET What has happened will give you an idea into
what may happen in the future. There are
some simple ways in which you can find what
has happened in the past.
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Here are 11 steps you can follow as a guide
to help you when investing in properties.
1 DEPOSIT
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ACCESS TO FINANCE
TRANSACTIONAL COSTS
CONTINGENCIES
ACQUISITION COST
Do you have enough money to put down a deposit for a
property? We suggest £25,000 is a good starting point.
Do you know if you can get a mortgage? If so, how much can
you borrow? It is best to speak to an expert mortgage broker
and get this information.
Allow for legal fees, mortgage broker fees, mortgage
valuation, property finder’s fees & stamp duty land tax.
Allow for mortgage payments, 8-weeks rental void period,
service charges, ground rents, repairs, tenant-find cost, lettings
management costs, your own tax liabilities.
What is the exact amount of money that is likely to leave
your bank account initially to make this purchase?
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INCOME
CASH FLOW
CAPITAL GROWTH
EXIT STRATEGIES
RETURN ON CAPITAL EMPLOYED
BELOW MARKET VALUE
What is the likely rent now? What is the projected rent
over the next 5 years?
How much money will you be making in a year considering
all the contingencies?
By what percentage has the area been rising over the
last 10 years? What do you think is likely over the next 5
years?
Understand that in property investment, you can either sell
the property (hopefully at a higher value), rent it out and earn
from the rental income and/or re-mortgage a property to take
some equity out (then you may use this to buy another
property investment)
How well is your money actually working for you
dependant on your exit strategy?
Now...can you secure this property below market value
to increase your performance?