How Can I Avoid Property Pitfalls?
Don't Buy a House That's Falling Down!
Whether you're searching for a property to live in yourself or to let out on the rental market, it's never an easy thing to define what actually makes a prospective purchase a bad one. Sometimes problems only present themselves after the purchase has been finalised however much you try to avoid a bad property beforehand.
It's always wise to check what similar properties are selling for in your chosen area regardless of condition. If the price difference between a house that needs refurbishment and one that is in a reasonable state of repair is not that big, it might be wiser to go for the one that needs very little doing unless you're looking for a clean slate to etch your own personal stamp upon.
Stick to Your Budget
Sometimes people vastly overspend on home improvements and find that the house has not increased in value when compared to others on the same road. This is because it's not easy to break the sealing price for a typical house in a particular area. So think very carefully before adding expensive extensions, conservatories and loft conversions which may be beneficial for your own use if you intend to remain there for a long time but won't have added a great deal to the value if you need to rapidly move on.
When there's no similar property to compare your prospective purchase with, as is the case with houses of individual design, you'll need to be careful that the asking price is reasonable. A house is only worth what someone's willing to pay for it and this is where serious errors of judgement can be made. If sentiment is allowed to rule, it's quite possible to pay far too much for the privilege of owning a property that isn't a carbon copy of the one next door.
Refurbishment Properties Can Seriously Damage Your Wealth!
'Let the Buyer Beware'
A competent conveyancer will make certain that searches are in place to avoid buying a property on contaminated land or land with a history of subsidence. Environmental searches are standard nowadays, so many problems associated with property purchase in the past have now been largely eradicated. You'll be given the necessary advice to make an informed decision but ultimately it's your choice if you feel your prospective purchase has more plus points than defects.
If you're buying a house to live in yourself, whether it's a bad purchase or not will often be more dictated by your own personal needs and circumstances rather than the condition of the house itself. It may just be a matter of opinion; for instance, if you don't drive and you buy a house nowhere near a bus route you'll soon live to regret your decision even if the house is in pristine condition but a car owner won't notice the lack of public transport. If you don't particularly like great Aunt Martha then don't buy the house just round the corner from hers. Living too close to relatives can sometimes be just as burdensome as living too far away. An isolated farmhouse may seem an idyllic place to live in the summer when the sun's shining over verdant rolling hills but you'll curse yourself in the depths of winter when you have to trek two miles to the nearest post box.
Ripe for Renovation!
The only certain way to guarantee a property will not be a bad purchase and be the cause of major expenditure in the future is to buy new and get a worry-free period where you know the builder will rectify any defects. New build houses in the UK come with a standard NHBC warranty (National House Building Council) this ensures peace of mind for up to ten years but a newer house will perhaps not increase in value as much initially when compared to an older house of the same size. Bear in mind that new properties are so much smaller than their older counterparts. Will you have to move again sooner than you think if there's an increase in your family? Will the house you viewed when empty be large enough to accommodate all your furniture? Developers often place large mirrors at strategic vantage points in new houses, sometimes leaving off the interior doors altogether to give the illusion of space. Show homes are invariably furnished sparsely so when moving day arrives you may find yourself already short of valuable space. Always take a tape measure with you for viewings and note down vital dimensions of items of any furniture that will be going with you.
Many refurbished properties for sale have been expertly finished inside but the developer has conveniently forgotten about the roof. If it doesn't leak - don't fix it is a good enough rule to live by, but a roof that's clearly seen better days detracts from the overall value of the property and will no doubt be highlighted in the surveyor's report. Many first-time buyers who are initially attracted to terraced houses because of their affordability are often put off when the survey lists a whole wealth of problems that need to be rectified. Try to see beyond the designer wallpaper and the vendor's subtle lighting and take absolutely no notice of any of their fancy furnishings and nice touches. When the vendor moves, that will move with them but you'll be lumbered with dodgy wiring and a leaky boiler.
Making Money and Adding Value
If your intention is to make money from property without the hassle of being a landlord, the only realistic way to do this is to buy a tumbledown wreck for next to nothing, live in it and do it up to sell on. But be prepared to live in a more or less permanent state of chaos until the job's done and once the house is sold, it won't matter if someone else will reap the rewards of your labours because you'll make a handsome profit. You'll have to plough it all back into the next project though and again live in a mess but it's worth it in the long term and you won't get bored from living in one place too long! There are people who've successfully progressed from two bed terraces to manor houses in the space of five years but these are usually builders who know exactly what they're taking on from the onset and don't particularly mind that the property they buy is a bad one - they can be confident of restoring it to its former glory and still make money. Two areas that will certainly need addressing in most renovations are the kitchen and the bathroom and this is often where a great deal of the expenditure lies.
Perfect Your Strategies by Avoiding Common Mistakes
It's generally more sensible to buy a bad house in a good area rather than a good house in a bad area.— Stella Kaye
The only thing you can do to rectify the situation if you find you've bought an unsuitable property is to try to improve it as much as possible, even if you're on a limited budget so that you'll be able to sell it on and find somewhere more suitable. A few gallons of magnolia paint or grey paint can work wonders. As can new light fittings, cream or grey carpeting throughout and neutral shades to make the best use of natural light. Well- maintained gardens and fresh exterior paintwork also adds appeal. Thus you can transform a house that has a dull and depressing atmosphere straight away and give it instant 'wow factor' with hardly any great expense. It's generally more sensible to buy a bad house in a good area rather than a good house in a bad area.
© 2015 Stella Kaye