Bringing an unloved property back to life can make you money but only if you know the fixer upper rules.
Harry Gladwin, Partner at The Buying Solution, says; “When most of our clients describe their brief and the ideal property, they usually finish the description by saying – “or a property which we could do-up / knock down / extend in order to create what we want”. The reality is that both the dream home and the fixer upper are like hen’s teeth at present – but both have pros and cons. The great advantage of buying a house which has been ‘done’ properly is that you can move in immediately and you know exactly what you are getting.
In my view there are three levels of project, the differences between which are broadly – risk, cost and time:
- 1) Cosmetic ie new kitchen, bathroom and decorate.
- 2) Extend – as above, with extension usually to create a large kitchen / family room and extra bedroom space.
- 3) Rebuild – knocking down an existing dwelling (or finding a site with planning consent) to build a totally new house.
With 1, 2 or 3 above, I find buyers typically underestimate the likely cost and amount of time projects are going to absorb; they also fail to put the right team in place and get the best advice at the outset, meaning that they can be exposed to unforeseen risk further down the line. We frequently see the 6 month project which is in its third year with no end in sight.
Typically an interesting ‘project’ property will hit the market with huge interest from buyers who cannot believe their luck in finding a property which ticks many of their boxes and is within budget. A little further down the line, once sums have been done, buyers fall by the wayside, realising that they are uncomfortable in terms of risk, cost and time.
Is now a good time to buy a ‘project’? – I think it’s always a great time to buy one, provided you do so with the right advisory team by your side. Acquisition cost is typically lower, meaning lower SDLT cost; it can present you with an opportunity to create exactly what you want rather than having to buy someone else’s creation and you can unlock huge value if your project is carefully considered, well planned and executed.
In any year over half our clients are buying ‘projects’ and our ability to find these opportunities, help clients evaluate risk, cost and time through putting together the best possible team of professionals is where we add real value.
Click here to read the full article; https://www.thetimes.co.uk/edition/bricks-mortar/how-to-renovate-a-house-the-key-to-success-is-having-a-plan-rmgr9xjz3