Week 33: A Closer Look At Renovations

Here it is in no particular order (as promised last week) a list of things to consider when renovating an investment property, better known as ‘flipping’ in the industry.

You may have heard this one before: buy the worst house on the best street!

There is a lot of truth to this, while you have total control of the interiors of a house you on the other hand you have no control of the externals i.e the land the house sits on. If you buy right i.e, next to good schools, local amenities, transport etc the value of the property will go up in time, even if there are small dips here and there. But no refurbishment in the world will compensate for a bad street in a bad area of a bad neighbourhood, just something to think about and that's without even picking up a hammer.

Try to factor in the least amount of spend which brings in the steepest value possible. What I mean by this is forget major works such as knocking down significant walls, building a couple of extra rooms or 2 or 3 bathrooms especially when the property has, say an en-suite and a family bathroom, will a 3rd or 4th increase the value?? Especially for a regular first time buyer where a single bathroom with a separate WC is more than enough. You have to think about who is purchasing the house. A conservatory is great and I love those, but will that justify the spend as it doesn't come cheap. Perhaps a nice decking instead or a great patio will do just as well. So tread carefully before making that all important call to that award winning landscape gardener.

Garage/Loft conversions. Here it starts to get a little bit trickier now and a bit more brain power needs to be applied. Say you brought a two up and two down and the roof is very new and spacious and it is something that has been done on the street as you can see the dormer windows. Then yes this could work as three beds are usually (but not always) desirable. A typical loft convection will cost about 20k in my city roughly. I am not a buildings contractor so please don’t take this as gospel it's just some numbers which kept coming up from my research. Garage; hmmm....this is another one. This could be developed into an office or playroom for the kids but then you do lose your garage. For some buyers this could be an integral part of their purchase as they want to put all their tools/kit into that space so developing this could actually have the opposite effect. 

Tip: if you have a very large private driveway where three cars can easily be parked then perhaps that conversion could prove extremely valuable… I'm thinking full on gym, but let's not get too excited hehe! And who wouldn't love one of those??

Things to definitely consider. Open plan living area especially if there is more than one reception room. This is quite modern and catching on more and more in the UK. An example will be a large kitchen diner overlooking the main living area. A new kitchen is a must, this is one of the most important and sought after elements of a house. These do not have to be very expensive if you shop around and have membership with certain traders then there are a lot of bargains to pick up. Go for ex-catalogue, 2nd hand (yet brand new) as brought by someone else but never fitted in their own kitchen. Don't buy off-plan or go too fancy and get swept off your feet by that kitchen sales dude who tells you this gadget ‘is the thing’ to have and these are flying off their shelves. That's all very well but they don't have to fly into yours haha. You have a budget to stick to remember. Bathroom is another strong contender and lifts the house. But does it need replacing? Ask the questions, if it's in mint condition then maybe just floor tiles should spruce it up. Trust me you will just know when it needs changing; remember those dreaded plastic avocado color bathroom suits?? Well if you're laughing at this then I know you had the privilege to grow up in one of those too. Sorry mom & dad what the heck were you thinking...

Other practicalities such as energy efficiency. You could never go wrong with this. Before you do anything at all make sure the house is treated for damp if it is evident that damp exists. Loft insulation, cavity walls, you get the idea. Does it need a new boiler? Perhaps a boiler jacket will suffice. Windows, doors you will need to examine all of these with a fine tooth comb. Maybe the internal doors are okay but you need to change the main front and back doors. Does it need brand new radiators? Maybe a partial update is all that is required. I know a person that just switched some of the radiators around from the rooms as they were the wrong size to begin with and that did the trick. But honestly people you could never go wrong with bringing your EPC up (Energy Performance Certificate). It's one of the first things a surveyor will look for when valuing a house. 

Other things to consider. Outside wall/render, fencing guttering etc. These are often overlooked and help create the first impression which can make or break the sale. Painting an old garage door or clearing out the garden and honestly if you don't know this then give yourself a slap. No one wants to see a messy front yard with your unwanted belongings in it, just sort it. At the very least do give the house a lick of paint with a light colour of your choice and new carpets at the minimum. Who can deny they don't like the smell of fresh paint and fluffy carpets beneath your feet?

Tip: Last one I promise, go for mid-range carpet with thick underlay to give it that luxurious feel for a reasonable price.