Thu 04 Jul 2019
Buying the Perfect "Fixer-Upper"
Is there still money to be made in the property industry? Well, despite current falling prices in London which, we can currently attribute to Brexit, the rest of the country seems to be holding strong, reporting ever increasing house prices month on month, year on year.
So, if now is a good time to buy, and it certainly seems to be the case that those who are carrying on with business as usual are making a success of it, what could be a good investment property to purchase?
Well, in our experience, we’d always tend to agree with Ms Allsop and Mr Spencer – “buy the worst house on the best street”. This will give you the most wriggle room to increase the value when you get your hands on it and start “doing it up”.
So, what makes an ideal doer-upper?
You need to consider the potential resale value. You might be looking to buy a relatively cheap property with a view to selling it on further down the line. Or, you might be looking to achieve a swifter turnaround. Either way, you want to keep up to date with the latest house prices of properties similar to what yours will eventually be like.
Location, Location, Location
It’s been said before, and we’ll say it again, location is super important when you’re looking to buy any new property. It is definitely important when you’re getting involved with more of a renovation or refurbishment project.
Ask for advice! Our expert teams in our sales branches will have the inside knowledge on what are the up and coming areas. If you are prepared to act swiftly, you may get a good investment opportunity as houses could be cheaper in the short-term, before everyone else catches on!
This is a good tip for both long term or quick investments, as the future value of your home is likely to go up if you buy in a good, in-demand area.
Think Before you Buy
We would always recommend getting the right level of survey carried out on any property. However, if your primary consideration is to sell this property on for a profit, it is worth spending the money on a more in-depth survey in the first instance, rather than get caught out and have to shell out more money than you budgeted for, for unseen issues. This will, of course, eat into your potential profit.
Plan it Out
It’s important to carefully plan out a comprehensive list of potential future expenses. Obtaining the most return on your purchase can be a fine line between spending carefully, and overspending on unnecessary luxuries. Of course, you don’t want to scrimp on the important things either, otherwise it might take longer to sell when the time comes!
To be frank, if you can't afford to refurbish the home in the way it needs, there is little point in buying it in the first place.
Do your Sums
You should be very clear on your budget, and make sure you stick to it. It’s a good idea to over-budget for supplies and labour, and also leave some contingency funds. This way, you are prepared for surprise expenditure, and your return is worked out on a worst-case scenario.
Can you do some of the work yourself? If so, or you can rope in friends to help, you will save a lot of money on the cost of labour. If not, it is a good idea to take a contractor along to the viewing with you, so you can get some initial rough quotes before you put in an offer.
Don’t go Overboard
It’s easy to get carried away with redecoration and alterations. You need to ask yourself, does the home definitely need a complete overhaul, or will cosmetic improvements be enough?
Some homes will rise in price simply through new décor or a refreshed bathroom or kitchen. These jobs will be less time consuming as well as less expensive. You might not see as large a return as if you did a complete refurbishment, but you could potentially see a quicker turn around.
It’s important that you consider the pros and cons of undertaking a “fixer-upper” property. However, if it does seem like the right thing to do for you, the long-term rewards are likely very much worth it.