Whether you’re a seasoned investor or a first-time buyer, purchasing a run down or abandoned property is a great way to get your foot on the property ladder for less, or make a profit by reselling.
Buying a renovation property at auction can be a cost-effective way to create the home of your dreams, or add value to a property before selling or renting it out. They might make it look easy on Homes under the Hammer, but there are some things to consider before jumping in to buy a project house. In this article, we’ll advise you of some things you should look out for while searching for houses that need work for sale, to maximise your return on investment.
The property’s location is crucial. Consider whether a property is located somewhere with high tenant demand, and research local house prices to gauge whether renovating the property would maximise your return on investment. If you’re renovating with a view to selling, you’ll benefit from the popularity of an area.
If you’re looking at project houses for sale to live there after the work is completed, think about the overall floor plan of the property. Does it have the capacity to increase the number of bedrooms, or could you reconfigure the ground floor to create an open plan space? Depending on the internal wall structure, you may need building regulations consent if you intend to dramatically change the footprint of the house, particularly if the property is a listed building or you aim to knock down load-bearing walls.
Often, run down or abandoned properties aren’t quite in keeping with modern-day decor. From dado rails to decades-old wallpaper, dated decor puts a lot of everyday buyers off purchasing. If a property is structurally sound and no planning consent is required for the renovations you want to carry out, one way of keeping the costs down is to attend to the decorative fixes first. Creating a more up to date home with new plaster, paint and wallpaper allows you to create a home to your own tastes, and will increase its appeal if you decide to sell further down the line.
When searching for houses that need work for sale, you should be looking for a property with the potential to add value over time. Kitchens and bathrooms are usually the best areas to increase value. From retro kitchen units to avocado green bathroom suites, outdated design is usually a fairly quick fix when renovating a property - especially if you bring in contractors to help you. For bathrooms, consider whether the current plumbing layout would cause issues if you were to reconfigure the space. Bathroom projects can become more costly if additional plumbing work is required.
Does the property have the potential for a loft conversion, extension, or reconfiguration to add extra bedrooms or bathrooms? Whether your goal is to add value for a future sale or to increase value over the time you’re living there, being able to add extra space to a property is a huge benefit. Whilst the initial outlay may be higher, you’ll more than likely add more value in pounds than you spend. Loft conversions or extensions can help you to make better use of the space the property already has, giving you more living space, or appealing to a wider pool of buyers or tenants - particularly growing families.
If you’re excited about renovating a property to fit your dream design, or want to add a profitable investment to your portfolio, you can find plenty of options for your next project here at Pugh. Our online property auction dates are available to view online, so you can begin researching potential renovation projects before committing to joining in with bidding.