Property development, should I buy a wreak?

Many people believe that buying a property that needs lots of building work is a sure way to make a profit, but this is not always true. You really do need to have a certain level of experience before you take on a full home renovation. You may have had experience of D.I.Y. or managing tradesmen to do work on your home, but successful property development is all about the profit.
If you buy even a small renovation project like a 2 bedroom mid-terrace you could be looking at a bill to complete a full refurbishment of ?35,000 pounds.
People think well kitchen couple of grand, bathroom a grand, electrics decorating, heating 5 grand, and ?500 for carpets should cover it. You need to set aside the time to write out a proper budget. My advice starts at the top and work down.
1. Price up the works to the chimneys, roof, lead flashing, fire break walls, facias, soffits and gutters.
2. External walls, Heli tie fixings, re-pointing, and any structural problems?
3. External windows and doors, bay roofs?
4. Ground works, landscaping and gardening.
5. Mechanical and electrical.
5.1 Plumbing.
5.2 Heating.
5.3 Flues.
5.4 Electrical installation.
5.5 Lighting.
5.6 Appliances.
6. Re plastering after electrical chases?
7. General backing up and re plastering
8. First and second fix joinery doors, door frames, skirting etc.
9. Bathroom, tiles, etc
10. Kitchen units, work tops, taps, etc.
11. Decorating.
12. Carpets and flooring.
These items can soon add up, and there should always be a contingency for the unforeseen, things like rising damp, black mould and positive pressure units. Most people are under cautious when they think of a figure for a contingency. Most experienced property developers allow 15% contingency for unforeseen items such as dry rot etc. Some even add 5% for ?unmeasured? that is things they may have missed like asbestos reports or a gas main hidden in boxing. So if an experienced property developer allows up to 20 percent for a ?20,000 pound refurbishment that would be an extra ?4,000 pounds.
So you may well beat the more experienced developer in the auction room, but if you hit a ?4,000 problem you had not bargained for the developer may well have made their money on a better project. So the advice is do not be in a rush there will always be other potential projects so take your time to write out a proper budget.