Property Investing Tip - Budgeting

Many investors don't budget correctly when they enter the world of property investment. Good budgeting can help to build your property portfolio smoothly, especially when thinking of long term goals.

The first most important budgeting you have to consder is knowing exactly how much cash you have to invest. This might seem obvious but it is important to understand your purchasing power, and if you are considering finance then you need to know how much you can borrow. You need to understand these figures before thinking about any kind of investment.

The next part of the property purchase process requires you to have a detailed understanding of the purchase costs involved in buying property in the UK, such as:

• Stamp Duty

• Mortgage broker fees

• Conveyancing fees

If you are refurbishing a property, adding value, maybe an en-suite, or additional rooms, you have to estimate these costs as accurately as possible, this includes ALL associated costs from materials to labour.

If you are renting what are the fees involved in letting through an agency, what is the finders fee, the management fees, some agencies charge for inventories and other additional separate fees.

If you are selling then work out and understand every fee involved in this process, capital gains tax, agent fees etc.

Finally the best advice in relation to budgeting is to overestimate any expenses and to keep an emergency float for any unexpected scenarios.