Top tips for redevelopment – Before you buy, resale and finding the right property | Property blog
https://www.rightmove.co.uk/news/articles/top-tips-for-redevelopment-before-you-buy-resale-and-finding-the-right-property/?utm_source=clipboard&utm_medium=sharing&utm_campaign=news
Top tips for redevelopment – Before you buy, resale and finding the right property
Europe’s largest online tradesman directory and review site www.myhammer.co.uk and London estate agents Kinleigh Folkard and Hayward have joined forces to advise wannabe property developers about the profits and pitfalls of investing in bricks and mortar.
According to MyHammer tradesman, property developer and Cowboy Builder’s construction expert John Russell, “Nationally the housing market is a tough environment, that aside, there is a residential property shortage and in certain locations a good level of active buyers. The key is to buy right and ensure you have done your homework and haven’t over paid for the property.”
Chris Early, Kinleigh Folkard & Hayward’s Sales Manager at Surrey Quays advises on how to find the right property for redevelopment:
The most important thing when looking to redevelop a property is to do your homework and think with your head and not your heart. Every element of the project needs to be researched and integrated into the budget, with consideration given to costs associated with the purchase, the redevelopment as well as costs incurred until a future sale.
Make sure that you identify a type of property that’s in demand, and the old adage of picking the worst house on the best road is still excellent advice.
Maximise the property’s potential; is there a section of garden that could be sold separately? Could you split the building into flats? Can you convert the loft?
Beware of external aspects that put people off such as uninspiring architecture, most often from the 1950’s to 70’s; buyers associate this architecture with ex-local authority areas and this reduces the chance of a quick sale. Pebble dashed exteriors are also often unpopular, but can be removed or re-rendered.
There are many buyers looking for period architecture, especially if features such as sash windows and cornicing still exist, and a strong front door and welcoming front garden make a great first impression. If you are selling a flat in a block or converting a house into flats it is imperative that the internal areas and facilities are well maintained.
If you are looking for a steady long term investment, look for water/river/park views, good schools or universities, period architecture, transport links (underground if applicable) and include those areas due to be regenerated. If you are looking for a quick turnaround instead, consider:
Margins – The property must be cheap enough to guarantee a profit
Unusual elements will draw positive attention, e.g. a corner plot or large outbuilding
Just look at the numbers and don’t allow yourself to be drawn in emotionally
Once you’ve found the right property, what do you need to consider before redevelopment and re-sale? MyHammer’s John Russell has some sound advice:
There are many levels of demand in the residential housing market, from value for money starter homes to top of the range executive properties. If you’re embarking on a property development project, where you pitch in the market depends on either your budget or risk vs. profit.
Some starter homes may just need a minor face lift to attract a first time buyer, from which (if you’ve bought well) a healthy profit can be made. If you aim higher and choose to extend and remodel a property, this can bring substantial rewards but will consume more capital and time. The main thing is to do your research and ensure you are buying in a location that has an active market.
When acquiring a property it’s best to look for either a run-down or dated property that does not appeal to the normal purchaser, or a property with the potential to extend and add more living space, thus making the house appeal to a different profile of purchaser than its current size/layout allows. This, nine times out of ten, will mean adding more bedrooms.
Once you are happy with the selection of area and the specific location, the next critical factor is the internal layout. Avoid small kitchens, ground floor bathroom and small 2nd/3rd bedrooms and instead look for, functional kitchens and bathrooms (a big selling point is an open plan kitchen and living space), good sized functional bedrooms and a separate reception room.
Once you have ticked all of these boxes, either by extending or remodelling the property, the next consideration is specification. Kitchens and bathrooms sell properties. Create the wow factor but don’t over spend – profit is what you’re after. Refurbish the house to suit the market place you are aiming at. My advice is keep it simple and minimal, clean lines, bright rooms.
A critical factor in any refurbishment is to get the fundamental aspects of the property in tip top condition, electrics, plumbing, roof coverings etc. It’s vital that nothing comes up on your buyers’ survey to put them off purchasing.