Do you lust after a broken down palace? Halls of memories and vintage structures, pull chains and coal cook tops? Maybe you’d love a retro paradise, complete with yellow kitchen benches, red bathroom tiles and sweeping high ceilings? Whatever your fixer upper poison, the investment market is busting with properties that need patient renovations, a little bit of love and a creative eye to reinvigorate the house, flat or townhouse, to its full potential. While this is very romantic and positive, a fourth, fifth or sixth hand house (often spanning generations) is loaded with hidden issues and niggles that may cause you to think twice before splashing your saved or loaned cash around. That isn’t to say, wrong way, go back, but keep the following tips in mind while you massage a few theories and explore your options.
The Fix-It Formula
Like all serious purchases, determining whether or not you should buy a property requires a little bit of maths and a great deal of honesty. Total all renovation costs, including materials, labour and condition assessments, slap on the purchase price of the property, the banking fees, services charges, pre-purchase inspections and real estate extras. It is achievable? Before you dunk down into your stomach, calculate the projected market value of the property after it’s all said and done (this should be a nice, round figure) and slash five percent for unforeseen circumstances, including inflation. The number left over should be your starting price or offer. Don’t sell yourself short, see the house for what it could be.
The Essential Inspection
We noted the importance of a pre-purchase inspection; if you’re looking into the lived-in market, a building assessment will save you money, hassle and a whole lot of stress later down the track. Why? An inspector is trained to identify and document serious problems and minor concerns before you buy, handing you agency as a market player to negotiate the price in your favour and request the current owner take on the costs of repairing anything the inspector finds. You want to renovate, not play Fix-It or extend the working hours of site workers. If a property has serious issues, avoid it all together. Taking on structural, electrical, foundational or plumbing projects is time consuming, costly and counter-productive – the little value you add to this house will be lost in translation when the final figure is delivered.
Choose Your Team Wisely
While the ideal renovation property is a cosmetic disaster waiting for a new lease on life, the perfect team need not be so hard to figure out. Obviously, you want someone who listens, who doesn’t require a lot of supervision or parroted orders, a building group you can trust. While trust and building might seem like a strange juxtaposition. Australia plays host to some of the most talented and dedicated tradesmen and women, including the team at coralhomes.com.au, allowing you to capitalise on your financial haul – don’t pay more for sub-quality work. Alternatively, you can mix it up, getting your hands dirty alongside the pros and immersing yourself in the world of do-it-yourself.
Have you invested in a renovators dream recently? What tips do you have to share with us? Success stories, nightmares and life lessons welcome, just leave a comment below!
Image Credit:
Grant Cochrane – FreeDigitalPhotos.Net
