How to make a flipping profit

Buy to let isn't the only way to make money from property

Updated: 
bury st edmunds  uk  march 10 ...

While buy-to-let is becoming less of the goldmine that it once was, there is still plenty of money to be made by snapping up cheap properties.

Limits on tax relief and a ban on lettings agent fees have made the sector far less profitable, and a quarter of landlords now say they plan to get out of the game.

But as property values continue to climb, 'flipping' homes - buying, renovating and selling them for a quick profit - is becoming more popular. "Flipping has become more common in recent years thanks to the rapid growth of house prices, especially in and around London," says Stephen Jury, spokesperson for home services marketplace Plentific.


Is this evidence that UK property is the best investment around?

Last year, according to Hamptons estate agency, £4.8 billion worth of homes were flipped across England and Wales, up from £2.8 billion in 2010. And the average flipped home was sold for £251,000: 37% more than it was bought for.

So how much money can you make?

Peckham, South London - increase of £325,000

5 Bedroom End of Terrace House, Lanvanor Road

Average value increase over past year: £42,725
Example property: 5 Bedroom End of Terrace House, Lanvanor Road
Sold in January 2016 for: £575,000
Stamp duty cost on purchase: £18,750
Price now: £900,000
Difference (ex. duty & renovations): £325,000

This property has made its last owner £325,000 in just ten months - although it's required a fair bit of work. Two bedrooms have been added via a loft conversion, and it's had a kitchen extension as well, all decorated to a professional standard.

This could cause UK property prices to crash in 2017

Westminster, Central London - increase of £242,500

3 Bedroom Apartment, Marsham Street

Average value increase over past year: £44,834
Example property: 3 Bedroom Apartment, Marsham Street
Sold in October 2015 for: £752,500
Stamp duty cost on purchase: £27,625
Price now: £995,000
Difference (ex. duty & renovations): £242,500

This apartment is white and bright, making the rooms feel bigger - and has a newly installed kitchen and bathroom: a prime example of how to renovate and upsell within a short space of time.

Chiswick, West London - increase of £75,000

2 Bedroom Flat, Speldhurst Road

Average value increase over past year: £16,223
Example property: 2 Bedroom Flat, Speldhurst Road
Sold in August 2015 for: £675,000
Stamp duty cost on purchase: £23,750
Price now: £750,000
Difference (ex. duty & renovations): £75,000

This flat, too, has a newly installed kitchen and bathroom and has put on £75,000 in the last 15 months. However, this is by no means all profit, thanks to stamp duty of £23,750, as well as renovation costs.


Scamwatch: beware property fraud

Hampstead Heath, North London - Increase of £250,000

2 Bedroom Apartment, Parliament Hill

Average value increase over past year: £75,706
Example property: 2 Bedroom Apartment, Parliament Hill
Sold in November 2015 for: £550,000
Stamp duty cost on purchase: £17,500
Price now: £800,000
Difference (ex. duty & renovations): £250,000

The price of this property has risen by £250,000 over the past year; an increase of almost half of its original value. And it doesn't appear to have taken a great deal of work, showing how a few small jobs can really make a difference.

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