The Property Academy Podcast Testing the Property Speculation Strategy: Does It Actually Work? ⎥ Ep. 1899
Nov 22, 2024
Dive into the world of property speculation, exploring its potential profits and inherent risks. Discover how short-term strategies differ from long-term investing. Hear a real-life example of a spec builder's journey and the pitfalls of off-the-plan purchases. Understand the financial implications of falling prices and contractual obligations, alongside advice on when speculation might be suitable. Finally, learn key strategies for those considering entering the speculative market and the importance of having a solid fallback plan.
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What Property Speculation Means
- Speculation means buying to sell quickly, often under a year, unlike long-term holds of 7–10+ years.
- Spec builds buy land then build to sell, and builders often run a few spec homes alongside trades.
Meeting A Spec Builder In Nelson
- Ed and Andrew met a spec builder in Nelson who bought land, built houses and sold them for profit.
- The builder sometimes outsourced the build and occasionally did spec homes alongside normal construction work.
How Spec Buys Typically Work
- Spec buy is buying to sell soon, often off-plan with small deposits and selling at completion for a gain.
- Historically some buyers made 20–30k per sale and paid down mortgages by repeating the process.