Property investment newbies have been warned that TV shows that claim making money from property is ‘easy’ should be taken with a pinch of salt.
Luton landlord Jonathan Schuman told some of the 36,000 people who subscribe to the All About Property Facebook group last night that there is no substitute for detailed local knowledge, research and good contacts with estate agents.
“Only if you do that will you eventually find the kind of deals where you can make money,” he says.
“So to speak, you’re after £1 properties that you can buy for £50p and then sell on for 75p, but that’s all about sourcing and persuading agents to come to you first with properties.
“It’s why I always say property investment is all about people and not property.
“You need to spend at least two or three weeks researching a market before you enter it – otherwise how do you know whether a property is an opportunity or not?
“Novice investors also need to understand that there are costs involved that aren’t talked about much on TV shows including the deposit, stamp duty, agency fees, legal fees and interest costs.”
Schuman, who revealed he is recovering from a mild bout of Covid after contracting the virus several weeks ago, was interviewed by Paul Shamplina.
The two discussed the current market and the effect of the pandemic on property investment.
Schuman surprised many of those viewing by saying neither stamp duty, unemployment or economic downturns were a determining factor in an active property investment market, but rather interest rates.
“If there is a serious recession in the coming months then it will be my fourth, but I can say with confidence that although things may look bleak and the least likely time to invest, given our low interest rates it will still be an ideal time to jump in.”