Property sourcing investments can be an exceptional way to run a property based business and generate decent profits. This cannot be done without strategy though. So...what is the best method for property sourcing, especially in Liverpool?
Liverpool is considered one of the best areas in the country for property sourcing despite how lucrative the business is itself. Averaging rental returns for Liverpool sits at 10% through six of its area codes...as a bonus, those six are also a part of the top twenty-five zip codes to rent through as a property investor.
What is a Property Deal?
First things first, before we can look at best property sourcing strategies, we need to go over a few key terms. Those would be what a property deal is and what property sourcing is.
A property deal would be when there is a pre-negotiated offer with a vendor, the vendor is typically the seller, that has a signed agreement to sell the property at the negotiated price.
Property sourcing is when a property is found and sold to a particular buyer often packaged up with other add-ons. These add-ons are typically with all negotiations and deals fully taken care of.
Best Strategies
Being able to source properties in Liverpool takes a few baseline strategies. Beyond research, you need to know what to look for and how you want to build out your portfolio.
Due Diligence
Due diligence is number one in developing your property sourcing methods. This means that you need to ensure both your money and your property will be protected long-term. If you are finding your properties through a company you want to be sure that they are successful.
You want your chosen company to be able to provide proof of past success and be able to provide testimonials or reviews of past clients. Knowing you will be taken care of as far as customer service goes and that your money will be safe makes all the difference and adds that much-needed security.
Build Your Portfolio
Having one property is a good option, but having a full portfolio may be even better. Having a full portfolio of properties allows you to gather rent from numerous renters.
Start with a property you know will last long-term, then begin building off of that. Diversify the property types and the number of properties you own. Very successful property owners have a well diversified portfolio...including different property types, in different cities or even different countries.
But Liverpool is the perfect place to start.
Building out your portfolio and having diversification also helps if you happen to need to sell a property or one is not performing as well as you had hoped it would. The ability to have properties that can fall as a backup plan aids in keeping your property investment venture afloat.
Very rarely do highly successful property investors only have one property. They often have numerous properties in their portfolio. This allows for higher potential profits if one property takes too long to fill with a renter or too long to sell if needed. The general rule of thumb for many life aspects are “don’t put all of your eggs in one basket” and property investment is no different.
Opportunities to Look for
Liverpool...and the surrounding areas...host a variety of different property sourcing opportunities to invest in. Some of these property types include:
Below market value properties
Student lets
HMOs
High yield rent to rent properties
Repossessed properties
These opportunities tend to have great success rates for investors and by opting for multiple types through your portfolio helps keep up diversity and allows for more properties to be added to your list of owned rentals.
Resources for Finding Properties
When finding the best strategy, you also need to know exactly where to look for the best opportunities. There are plenty of online auction sites that can help you in your property sourcing journey.
In the Liverpool area:
For some sourcers, direct mail is also an option. Many homeowners will have a desire to quickly sell if there are some unique situations like death, divorce, costly repairs, or other high stakes situations. Mailing out offers to properties that meet your specifications could yield sellers that find themselves in these situations with a level of uncertainty on what to do...but there you are with a solution.
Bonus
Work with a property sourcing and investment agency. Bringing in a company allows you to have professional help by helping you invest your money property, grow quicker and more accurately, and also gives an opportunity to sell your properties through them if needed.
Having an agency at your side can be a valuable asset in your property investment tool kit.