“The best way to move up the property ladder is to look at property laterally. It used to be possible to buy a tired flat and by just tarting up the kitchen and the bathroom you could earn enough tax free profit to climb another wrung on the ladder.
However, this kind of developing will no longer produce enough profit to cover your Stamp Duty and moving costs, so one has to look beyond the obvious and be prepared to remodel and extend. Opening lost space in corridors into useable and more valuable living space, knocking flats back together or extending into gardens, or improving access can all enhance your chances of getting to that illusive four bedder.
Buying short leases is another excellent way of developing. Being less mortgageable, short leases require buyers to have a much larger percentage deposit. And as long as they comply with the leasehold reform act more years can be bought. The profit comes from the discounted sale price as less people can buy them and can be bothered to enfranchise. One of the best things about them is that in the short time a short lease property will yield a spectacular rent compared with its purchase value. It just depends whether you have an appetite for what can be a relatively drawn out process. Achieving change of use can also be a fantastic way of improving a property’s value”.
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