With the recent property slump many people are understandably very cautious about taking on a renovation project, but there are still plenty of properties out there waiting to be renovated.
Play the Mortgage Game
Now is actually a good time to renovate, if you can borrow. With current low interest rates, you might be able to get a good deal, and lots of builders are offering competitive quotes. By the time you’ve finished your project the market may well be on the rise again…so taking on a project in the slump could actually be a good investment.
The flip side of this is that although interest rates are low, lenders are coy, so deposits have to be higher. There are also far fewer lenders prepared to offer mortgages on renovation projects and fewer products to choose from. But this could be considered a good thing as it’s going to make you more diligent in budgeting and making sure there’ll be a margin at the end of the project.
Finding a Renovation Project
So, how do you find the perfect project? If you’ve identified your ideal area a good first stop is always the local estate agents. Many of them will carry properties that could be ripe for renovation, which they don’t promote heavily for fear of over-cluttering their window displays. The personal touch of using an estate agent is the most likely avenue to find a property that matches your requirements and budget.
Local newspapers are also worth checking, they will sometimes carry private adverts for old properties. But if you prefer the digital realm the internet is also a great source of renovation projects. General property websites are worth a look, but it may be hard to find a suitable property among all those listed.
More Esoteric Renovation Sources
More useful are the specialist renovation websites as their targeted listings can really help narrow down your search. Some are free but many you have to sign up to and pay for. But if they yield the right property it’s a tiny investment compared to the budget of a renovation and the potential profit to be made.
Auctions are another popular way to find a renovation property. Sellers will range from housing associations to private individuals, and they are an excellent way to find neglected properties that people want to sell quickly and easily.
The more adventurous may be interested in renovating a historic building which can be found in a ‘buildings at risk’ list. These are published by a number of organisations, although even if a building is listed there’s no guarantee that its owner can be found, let alone persuaded to sell.
Look at Land Deals
You may also find properties on land being sold as building plots. Many plots have buildings that less adventurous developers would simply pull down, but which could be ripe for renovation.
The recent recession has actually led to an increase in the number of plots available, as developers look to improve their cash flow by breaking up larger plots of land and selling them to individuals. There are a number of specialist websites that offer listings of plots for sale, but, again, you may have to pay to use them.
If all else fails you may even get lucky by walking around your chosen area and looking for properties that need work. Boarded up windows and overgrown gardens are often a sign that a property is abandoned and in need of work.
Assess a Renovation Project Carefully
Before taking on a project you will also need to consider its potential, a few key areas to bear in mind are:
- Location – where is the house? Buying and renovating a property in a desirable location may cost you more to start, but could make you more money than in a less desirable area.
- Condition – how much work will you need to do to the house? It may appear to be a bargain, but might require a lot of work that will take time and money.
- Planning permission – how easy will it be to obtain planning permission to make changes to the house?
- Land – check the deeds to find out what the boundaries of the property are – do you have room to build and extend?
Take a Punt?? Even though we are in a slump, now could actually be the perfect time to take on your renovation project. If you look in the right places, and consider your choices carefully before committing, you could pick up a gold-mine.