Complete renovation - worth it?

TooMuchDebt_2

Hi,

We're a married couple who are currently renting in West London, but are looking to move out into a nicer, greener area with lots of open space and less stress! So far, our choice of areas has been whittled down to the Surrey / Hampshire border, and specifically Fleet and Farnborough stand out as nice but reasonably priced towns, so we've been looking for houses around there.

Now, we've found two houses that we like the look of, the first is on the Market for £375k having just been reduced from £400k, and the other is on for £300k, having just been reduced from £310k. The properties were built circa 1920 and the original houses would have been the same.

The more expensive property has a rear extension and side garage and is decorated to a reasonable standard.

The cheaper property would need a complete renovation. An elderly man lived there until he was 101, and it looks like it hasn't been touched since 1950. To complicate matters, a company bought the house for £270k in January thinking they could change the use from residential to commercial. This request was declined though, so they've put it back on the Market for £300k (not sure what the logic there is, surely worth less now?). The upside for this cheaper one is the massive grounds (100' garden, 60' front / drive) and the scope to extend to the rear, side and loft. Another plus point would be lower deposit initially, and saving on stamp duty.

Anyway, I've kinda fallen for the idea of renovating to how we would like it to be, but I think the price is unreasonable. I offered £250k but it was flatly refused.

I don't want to get carried away here, so thought I'd see what others opinions were. What would you do in my situation?

terrierlady

no one accepts the first offer... what area ?both places sell well, lots of army folk like to buy so good market but area is critical in both places, you will spend more than you think renovating but its worth it in the end lots of buyers like features of the period so usally they fetch more on resale look on Zoopla and Rightmove for prices in these areas etc. Lets see what the experts say.

TooMuchDebt_2

Point taken about the first offer, but if they were interested wouldn't the estate agent have prompted me for a better offer rather than dismiss me out of hand. He ended the conversation with '...we'll keep your details on file and let you know if anything else comes up'. Or is this just a very good psychological tactic that they employ?

The houses are here:

£375k: http://www.rightmove.co.uk/property-for-sale/property-29644546.html
£300k: http://www.rightmove.co.uk/property-for-sale/property-34215998.html

They are both along Farnborough Road, but the more expensive one is in arguably a better location, just outside the town centre and nice and green with fields across the road. The cheaper property has a shopping centre across the road, and it's just off a dual carriageway so not as nice.

KateLiana27

I'd always much rather go for a renovation project - provided the cost of renovating + purchase was not more than buying it decorated already. You get everything brand new and to your taste, rather than paying for someone else's part-used fittings. Also, you can't change the size of the plot of land, but you can change the inside of a house - so I'd rather pay for a bigger plot than nicer decor.

I would work backwards. Have a very close look at the cheaper house and price up everything it would need. Remember to include any hidden problems like an electrical rewire, structural work etc if there are any signs of the house needing this. If extensive work is needed, factor in the cost of remaining at your current property or in rental while the bulk of the work is done. This considered - what sale price would mean that the house was a good buy? Offer that and don't go above it. Forget about the asking price and previous selling price - it's what it's worth that matters.

dancingfairy

I don't know whether you can get a builder to go around and point out the jobs that will need doing and give a rough estimate?
Also I'd go to the library as they will surely have property development books and might give you an idea of prices for certain jobs.
Best of Luck
df

jahudson72

This is a tough one! It's generally all about the location, so I would say firstly think if your renovation project would be easier to sell than the not to be refurbed after you've carried out the works.

Do you like gardening?

Are you prepared to live in a building site for a year (or more?!).

Lots of questions and a lot of it depends on how much you can lever off house that doesn't need much work compared to other one. You really need to find a reputable builder and a chartered building surveyor around to the second house, tell them what you want and then decide if you can afford it and then decide if you can live through it. Only when you've got those costs in your hand and know what would be involved can you make a detached decision.

Good luck.

murphydog999

Quite similar properties aren't they. A couple of thoughts.

Think about what you could do to the cheaper property with the £75K the other is asking, are there any other houses in the street that have sold recently, that would give you an idea what they are selling for refurbished?
Do you actually know for sure planning would allow what you want to do with extensions etc?
If the interior is neglected the exterior could also have problems.

Just things that sprung to mind.

TooMuchDebt_2

Thanks for the input guys. If I'm honest I'm leaning towards the renovation project, for the reason mentioned above - being able to start from a blank slate and configuring to our tastes.

My dad is a builder by trade, so he has connections (brick layers, roofers, plasterers etc) and knows the costings. Plus he said he'd help out with the renovation, sourcing materials from trade suppliers to keep costs down.

I've come up with a rough estimation, including:

Full electrical rewire Replacing central heating system (boiler, radiators, pipes) Replacing windows & doors New kitchen New bathroom Redecoration inc. replastering

and the cost isn't too overwhelming. The other advantage is we could do things in stages dependent on affordability, for example get the house liveable first, then look to do the extension later.

Hmmmm decisions, decisions.....

devotee

Normally I'd say go for the refurb project, but in this instance I'd think you'd just about break even - the refurb house is too expensive when compared to a done up house (and has one less bedroom too and no garage). Plus I prefer the location of the more expensive house. Just my 2p.

kmmr

Have you done a renovation at all before? It's a big job to do if it's your first one. Having a father who is a builder is a massive assistance, just to have someone to advise you is very helpful. Even if you ignore the advice!

I've just done a big project, extension and complete refurb in west london, and it was twice as expensive and 10 times the stress expected! It was TOTALLY worth it, and I love my new place, but I am taking a few years now before thinking of another one... it is a very difficult and stressful and tiring and yet wonderful experience. Which won't help you I am sure, but if you do go ahead, there is a good renovation thread on the DIY board which can be very helpful and supportive.

TooMuchDebt_2

murphydog999 wrote: »

Quite similar properties aren't they. A couple of thoughts.

Think about what you could do to the cheaper property with the £75K the other is asking, are there any other houses in the street that have sold recently, that would give you an idea what they are selling for refurbished?
Do you actually know for sure planning would allow what you want to do with extensions etc?
If the interior is neglected the exterior could also have problems.

Just things that sprung to mind.

A couple of the neighbouring properties have extensions to the rear and side, so I'm hoping that there's a precedent set.

I had a look at Zoopla for sold prices, and came up with the following:

Jan 2011 190 Farnborough Road £270,000
Dec 2010 136 Farnborough Road £325,000
Aug 2007 142 Farnborough Road £290,000
Aug 2007 178 Farnborough Road £310,000
Nov 2006 200 Farnborough Road £372,000
May 2005 194 Farnborough Road £300,000
Jun 2003 196 Farnborough Road £278,000
Dec 2001 184 Farnborough Road £250,000