Dreams & Pipes

[Catwoman]

I am considering three possible money-making ventures. Perhaps you could advise which if any you think I should pursue. To avoid this turning into another long-drawn personal advice thread, I have condensed these options into Haiku's (must be a phase I'm going through). Would be most grateful if you could vote on the one most likely to make me a millionnaire (or just a few extra grand). The options are as follows:

1.
Buy a plot of land
for less money than I make
when I sell built house.

2.
Buy a small-ish flat
rent it out pay mortgage and
good source of income.

3.
Set up cocktail bar
in busy town where I live
make lots of money.

I can assure you these options despite their simplicity are well thought out and not blind pipe dreams, I just didn't want to bore you with the details.

Biggest problem is lack of funding, I cannot get a self-build mortgage until I've had a normal mortgage for at least a year (and even then remote chance). So any ideas on funding would be useful. Let me know if any of you have any spare thousands, you know, only if you were going to throw them out anyway... *sigh*

So - let the voting begin!

[glatt]

I imagine that #2 is the most likely to work. There are so many ways to screw up numbers 1 and 3, but number 2 is much more fool proof. Of course, the payoff for #2 is smaller.

[Catwoman]

Hmm. Bearing in mind the housing market in the UK (and elsewhere I believe) is at an all-time peak - you don't get a lot for your money, and while the bank of england estimate that house prices will fall slightly and steady over the next few years, I predict a big drop in prices as interest rates rise and national debt escalates out of control - people will owe too much on credit/store cards to afford property and their credit ratings will suffer. Meaning if I do buy an existing property now all I could afford would be a small flat and chances are it will be worthless in 3 or 4 years. So not so safe after all? Of course I could be completely wrong.

[glatt]

If a small flat isn't safe, then a house is even less safe. Building a house,there are so many things that are outside of your control, it's potentially very dangerous. Most first time builders lose money on their houses when they sell them or else end up earning what amounts to less than minimum wage once they compare their profit to the hours they put in. It's a very delicate balancing act. You need to build a cheap house to make a good profit, but if it is too obviously cheap, nobody will buy it. You have to know where to spend the money. Does the market there require marble countertops? Or does some man made product do? You can use the highest quality building materials, but then that eats into your profits.

Here's a very good thread on the topic. The market and building style is probably different from your area, but the advice is sound. Building a house for profit

Maybe you should go with the booze peddler idea. When I worked in a corner convenience store in my youth, we made all our money on booze, cigarettes, and lottery tickets. The rest of the items were really just for show to get people to buy the 3 top money makers. I have no idea what your town is like and if it will support another establishment like that.

[glatt]

Now that I think about it more, the more I like the flat idea.

Say the bottom drops out of the housing market. The last thing you want to be doing is trying to sell a house for profit. You will lose money.

But owning a flat wouldn't be so bad. Not many people will be buying the low priced houses out there, because the interest rates will be so high, they still can't afford to buy a house. That means there will continue to be a lot of renters. You should still be able to rent your flat out and make your money. Now if your idea of buying a flat is to sell it for a profit, then it won't work. But holding a flat and renting it out should be OK.

The bar idea could be really good, but there are a lot of regulations governing places like that and I understand it can be complicated. If it's a busy college town, you can probably make decent money, but it's a lot of hard work. If you aren't there all the time, your profits will walk out the door as your help gives away free drinks etc.

I like the flat idea because you put in a minimum of effort and get a steady income. Only real risk is if the place is falling apart and you have to constantly fix it.

[Catwoman]

The cocktail bar idea is a pre-nightclub venue selling all manner of cocktails - see www.cocktail.uk.com for a rough idea. There would be various promos - design your own cocktail, mammoth-sized cocktails - and proper cocktail barmen with all the tricks, scantily dressed young female waitresses, and as the town I live in consists mainly of students/holidaymakers I know the market would appreciate. There is nothing quite like it already in existence, just a lot of style-bars, upper-class eateries and nightclubs. It fits the town, the time, the tune, perfectly. It's an idea I've had for at least 3 years just never had the funding, or the confidence. My town is becoming more and more of a holiday resort with hen/stag nights, strip clubs, beach-side bars etc etc. This is the ideal time to capitalise. I am more and more drawn to this idea - might save the self-build project for when I have more time/security.

[Troubleshooter]

My family lost everything in a bad purchase of rental property.

Make sure the the flat, the building the flat it in, etc. all up to all building codes. Hire a professional inspector, don't count on the fire marshall.

It's a great way to generate recurring income, just be careful.

[Catwoman]

Originally Posted by glatt

But owning a flat wouldn't be so bad. Not many people will be buying the low priced houses out there, because the interest rates will be so high, they still can't afford to buy a house. That means there will continue to be a lot of renters. You should still be able to rent your flat out and make your money. Now if your idea of buying a flat is to sell it for a profit, then it won't work. But holding a flat and renting it out should be OK.

But what if interest rates don't rise. And what if house prices fall to the point where the rental market diminishes significantly and it becomes harder and harder to lease the property? I know what you mean though. At least I would have a mortgage paid for me, which would be not real extra cost to me and would boost my credit rating significantly (plus it would be security for another loan for the bar or the self-build project).

[glatt]

Sounds like you are most excited by the idea of running a bar. That excitment is an important part of this equation. Now you just need a financial backer.

[Catwoman]

Is that an offer?

Yes, I could get a loan but don't know if I could borrow enough. It would be a siginificant initial outlay and that is the risk. But if you never take risks in this life... well I am certainly not one to be stuck behind an office desk for the rest of my working life. Think the first thing to do is put together a proper business plan, find out how much it would cost then go to see my bank manager in a nice suit and low cut top...

[Trilby]

Catwoman-I think you are overlooking the obvious. You should get a job that combines your love of money with your admirable love of sex. Best of both worlds, girl.

[lookout123]

I think you are overlooking the obvious. You should get a job that combines your love of money with your admirable love of sex. Best of both worlds, girl.

are we witnessing the beginning of a lucrative career as a provider?

[Catwoman]

I don't love money I love what it facilitates (a month off in a van, two months off in a van, ten months off in a van - you see the pattern). And I do love sex just not what it facilititates (babies, std's, hassle). So really I should get a job in a van with a condom. West coast English ho it is then.

[Trilby]

Ah, Lookout--missed you! And Catwoman, no offense was intended about the money thing. We all need money--I didn't really mean to imply you "loved" it--just semantics. No problem with the babies, std's, hassle...be selective, use a condom and let me know how it all works out! A friend of mine was in England over the summer (London) and he was mightily impressed with the adverts in the phone booths over there. He even nicked a few and sent them to me.

[glatt]

Catwoman,
if you like taking time off, then maybe a bar isn't such a good idea. I can't think of anything that would require more of a time committment than running a bar or restaurant.