1) WHERE DO WE START?

There are 3 main reasons why people buy houses to renovate:

1) To move to an area where they can’t afford a new property of the size and quality that they would like, so opt to find something in that area to work on which will give them the quality of live they want at a budget they can afford

2) To get something larger than they already have without going heavily into debt on a mortgage.

3) To improve the property with a plan to sell it at a profit.

Some people will buy a property that simply needs cosmetic work. – Perhaps a new kitchen, decoration, bathroom etc, and some plough themselves in to major projects where the first job is to pretty much reduce the property to a bare shell

It is important that you are clear on your aspirations before you make any major decision on buying a property to renovate. – They can be very tricky, costly, complicated, time consuming, frustrating projects to be involved in, which require you to have a considerable knowledge of building structures for you to be able to make the correct decisions as you progress, and they can test a couple’s or a families resilience to its limits, especially if and when things start to go wrong.

As a guide, if you are just thinking of a fairly minor “cosmetic” type project, you’ll generally be ok as long as you get the proper surveys done before you commit yourselves. BUT – MAKE SURE you “do your sums” before you buy.

You need to work our realistic prices for the work you are planning on doing., covering areas such as “Stripping out” / Materials / Labour / Designers / Fees / “running around” costs / Landscaping / Waste disposal etc . – These are all real costs to the project but a lot of people don’t tend to include them when they are working out their costs, and then wonder why the project cost so much more than they thought it would! (Remember you don’t generally get your VAT back on Renovation works like you do on a self build project) .

Add all the likely costs up, including the legal and survey fees (which can be a lot higher than for buying a new home or a property that only needs a basic survey), then add them to the actual cost of the property.

If they come to anywhere near the cost of buying a property that you would be just as happy with that DOESN’T require work, then you probably need to rethink. Why?

·         Because estimated costs for building works (even cosmetic works) are generally too low and can often be found to be thousands of pounds out when the project is completed.

·         Because you will be putting a lot of your own time and effort into the project: Time and effort that you wouldn’t need to if you bought somewhere that needs no work doing and is ready to move in to immediately. – Financially you will usually want to see SOME financial gain for all work you have done

·         Because if you come across any major unexpected problems during the project (which is a common occurrence on renovation projects), you could quickly find yourselves out of pocket with much of the work still to do. – You can’t just stop, give up and sell it again, - most people who see a part completed renovation project “smell a rat” and won’t take it on unless the price is VERY attractive. – You could end up losing tens of thousands of pounds.

If you are thinking about taking on a larger more complicated or difficult project, you really shouldn’t even think about it until you have questioned yourselves about your ability to be able to complete it successfully:

·         Do we have the knowledge we will need about the structure of the building to be able to make decisions? – If not, can we afford to hire the people we will need to do the work for us?

·         Do we have the time on top of our other commitments to do all the running around that will be needed to find the people and materials, including all the “bits and bobs” that are suddenly needed “NOW - otherwise the job stops”?

·         Are the family all on board? – And are they prepared for the upheaval over possibly many months. – Will they still be ok with everything if the project runs over by a few months?

·         Do we have the financial resources to cope with extra unexpected expense to fix problems we didn’t foresee or to cover us for staying in other accommodation for a few months if we need to?

 

·         Are the people we are going to need available in our area? – If not there could be considerable expense in bringing them here.

·         Is the project going to make us money when it is finished? – And if it is, do we think that it will make enough to make all the work, stress and time worthwhile?

·         If there is a cost overrun (which there usually is), will we still be glad we did the project once we have paid out all the extra money?

·         If we really think about it, would we be well advised to start looking at a few alternative properties around the same area before we commit ourselves to this project? – Just in case we find something that doesn’t need all the work, but that we can get for the right price?

On ANY type of renovation project, you need to make sure you do three things:

1) Get, and keep the family on board:

If you try to do one of these projects without the backing of the family, you are really asking for trouble – many projects have failed because one or two member of the family are not “up for it” and the friction this can cause, especially if and when things go wrong, can turn the whole thing in to a nightmare

2) Do your research and preparation properly before you start:

·         Do as much work as you can on working out the likely extent of the work that needs doing.

·         Try and get a reasonably accurate idea of the prices of all the new “stuff” that you are likely to be using.

·         Check the availability of labour and materials in your area.

·         Check your own finances and make sure you have got a “buffer” to cope with unexpected problems.

·         Check up on the Planning Permission situation. – If there is a possibility of you needing it, make sure you get that sorted before you start.

·         If you need Building Regulations, make sure you get them before you start, and make sure you get the inspections done when they should be during the work.

·         Where there is a possibility of any claim being made against you, or of any loss occurring, make sure you are covered with insurance for theft, injury and Public Liability.

3) Get the correct type of survey done. – YES! – They are expensive, but you only need to find a crack afterwards that shows that the foundations have failed, and you could be facing a bill for thousands of pounds

To find out more about property renovation read: Self Build Simplified