Is Buying a Derelict Property a Good Investment?
Buying derelict property can be a very good investment, but that very much depends on the type of derelict property that you purchase. For example, if you purchase a derelict cottage or abandoned house which needs to be completely renovated, it may prove to be a long term investment but this does mean waiting a considerable length of time and spending a substantial amount of money during the property renovation process.
If you purchase a derelict industrial or commercial property, it can often prove to be a wiser property investment in the terms of the return you will gain on that investment.
One recent example is a client who purchased a derelict industrial building on the edge of Birmingham, a former small textile mill, which had been unused as an active property for a number of decades.
As the area around the property began to redevelop, his once derelict property became a piece of prime real estate. Essentially this means that although the property itself was derelict the land that it occupied became more valuable than the derelict property itself.
If you are looking for an unoccupied property or a disused building and your intention is to invest in a long term program of redevelopment, you should look at the bigger picture and take account of recent developments over the last 10 to 20 years in your area of interest.
Investing in property is always a gamble and, while some people may say it is an educated guess, it should be more of a calculated decision than merely guesswork. In addition, making money from renovating property is not always as easy as it seems.
Small-scale property purchases such as derelict cottages, abandoned houses in the country or disused buildings such as churches and farm buildings are more prone to be renovated and resold rather than held as a long-term investment. If you have the money to renovate such a building you can realise quite high returns on your original property purchase.
Buying a Derelict Property with Land
If you are looking for a derelict property with land for sale and you have a desire to live in the countryside, you may well be on to a good property investment opportunity.
Derelict properties come in all shapes and sizes including derelict farm buildings such as barns ideal for conversion or renovation, disused churches, empty cottages and flats plus many more types of properties. The ideal situation would be to find a derelict cottage or building with land for sale which is suitable for renovation.
Depending on the type of property you find and the amount of land which comes with it, investing in such a property could open up a world of opportunities for you in the longer term. For example, if you were to find a derelict property for sale, such as an old cottage with some land, not only could you renovate the property itself, but the land could act as a smallholding, be used to extend the original building or even sold as a separate plot in order to recoup some of your invested funds.
