Refurbishment Business

[houman1979]

Hi,

One of my friends is going to start a business in residential business refurbishment. He has a good network of plumber, electricians, and other relevant professions to do the job. He asked me to have a hand in the business.

Now, we are struggling to decide which options is better: 1) buy tired properties, refurbish and sell? 2) refurbish other people's home. The first option needs higher capital and financially is riskier (although the return maybe higher in a bullish market) but I need some advice on which option is better for a start-up?

 

[LondonSW]

Both, to start with.
On top of the buy-to-refurbish-to-sell, you may also buy-to-refurbish-to-rent.
Absolutely not as easy as most people imagine, but still viable, and anyway you will learn from your mistake.

 

[houman1979]

Thank you for your email. As I don't want to put too much money and get involved in mortgage process I assume that I'll go with option 2. Then, should I get any license or permission? Thanks

 

[billmccallum1957]

Ask yourself some basic questions....how will I find customers? How much is everything going to cost - vehicles, insurance, staffing, etc

If you're in London the cost of buy-to-sell is going to be very much higher than other parts of the country.

To be brutally honest, if you don't know the market, it will be very difficult to be successful, so what's your experience? how will you fit into the business?

 

[David Griffiths]

One thing that you will definitely need to be aware of, whichever route you choose, is the need to apply the Construction Industry Scheme rules to payments to your contractors . Getting that wrong can be very expensive

 

[houman1979]

Thank you so much. I definitely will not go with the buy option as I cannot afford it now.

I will refurbish others homes and my friend has done it several times and has his own network and as you said his issue is business development and marketing side of the job.

I've developed some other businesses before but not in this field and it was the reason that I asked my question.

And thank you David for your advice. I know these stuffs could blow up all of your investment easily!!!

 

[columbo]

I think you need to read this:

http://www.amazon.com/Book-Flipping...=UTF8&qid=1455751432&sr=8-2&keywords=flipping

 

[PaulThompson]

If you have questions about what can be done with finance I will be happy to help
Seeing as you seem to have all the trades "in house" if you can fund the refurb costs of a project then I can fund 90% of purchase price for you (residential property only)
We just need to show that you'll make a profit after the deal and that you have the ability to deliver!