Would you do up a property or sell as is?

orchid2010

A work mate has asked me to get the views of the forum on the above question.

They have a end terrace house (built in 1900's) which needs work doing to it. It is structually sound and has gas central heating which was installed in 2006. There is no mortgage on the property.

There was a condensation problem which has been sorted out and also slight damp downstairs which was due to blocked air bricks under the floor. Plaster has been taken off several walls because it was blown (mostly from the condensation and age of property). It will need complete re-wiring, new kitchen, new flat roof to downstairs bathroom extension and probably new windows. It is in a popular area near to good primary schools.

This is were the question comes in, as it is an end of terrace and also has a very large loft space, my friend was wondering if it would be worth the effort to get planning permission and a loan to extend and repair the house, just do the necessary renovations or to sell it too a builder as is? They have two builders interested in buying it as is (but of course the price is quite low).

They do not want to move into the property or to become landlords. My friend does not really want the hassle but her OH is looking at the potential profit they could make.

BitterAndTwisted

The number of people who want to move into a property and not immediately have to undertake extensive renovations far outweigh the ones who would welcome taking on a project.

In your friend's position I would spend money on essential repairs like the re-plastering, re-wiring, new kitchen and the new flat roof then apply for the planning permission to extend before putting it on the market.

sirmosh

While doing it up wouldn't necessarily add a huge amount of value it's going to make it so much easier to sell.

Better_Days

The nature and amount of work that needs doing will be very disruptive, especially if you are targetting a family market (you mention schools). It is likely that most potential buyers will not want to live through this being done. If you are targetting FTB's they may well also be more hesitant about employing tradesmen to do the work.

What is the market like in the area? You need to do some research as to the sold prices of similiar properties in turnkey position as opposed to what the current value is. Do the figures stack up?

After my Dad passed away I arranged for his flat to be refurbished, new kitchen, bathroom, carpets and decorating. This made the flat much more saleable as someone could just move in. It would probably still be on the market now if I had left it as it was.

I agree with B&T, if the figures stacked up and I had the energy, I wouldn't extend the house (but I would get PP) and I would carry out the essential repairs to bring it up to an acceptable standard.

Still if your friend want an easy life he could just sell it on cheap to a builder. Horses for courses really.

phoebe1989seb

It does also depend on what the demographic of the area are looking for........

We've previously sympathetically restored one (of many ) period property where we dragged it kicking and screaming out of the 1980s with new wiring, two new bathrooms (one if which we created from eaves space), replastering, new kitchen (solid wood/granite), garden re-landscaping and not increased its value at all - but the work done did make it infinitely more saleable. However, this was in an area where most buyers were looking for small, modern (think low maintenance everything) bungalows, not sprawling character homes so our *improvements* were necessary - if you like - to attract a different kind of buyer.

In a location where properties were taking a year+ to shift, we accepted an offer within a fortnight.

OTOH, we recently had to sell my parents' 1920s house that was a little tired - work done to a very high standard, but little except a wet room done since the '80s - and we found that in that particular area young couples/families were looking for *project* houses to which they could add value (loft conversions etc) and transform into *forever* homes.

We decluttered, did a few quick maintenance fixes and sold it as it was - after a slight re-adjustment of the price we received asking price offers and sold within a couple of months of originally marketing it.

IMHO it does depend on how much work the vendor wants to take on and how much difference doing that work will make to the price they can achieve. Personally, I'd be inclined to do as others have suggested and get planning permission for extending etc without going to the trouble of actually doing the work.......

Fire_Fox

Get the windows, walls and roofs fixed at the very least, making the property weather tight and dry is critical for a decent survey result. Older windows can often be overhauled by skilled trades, you may have to go through a few companies/ quotes to find the one who will/ can. In many areas period features are desirable, sometimes old sash/ casement windows are durable hardwood so you can just splice in new sills and 'inject' hardener to protect the rest.

You make more money if the place is mortgageable/ habitable. Agree family buyers don't want to do loads of work but they tend to mind less spending out on 'fun' stuff like decorating and kitchens compared with boring stuff like roof and windows. Bear in mind a buyer may not be able to raise a large enough mortgage to do tens of thousands of pounds of work.

By all means get outline planning permission, plans and costings for the loft conversion and extension but I would not actually bother doing the work.

StuC75

Take the figure that is being offered by the Builders..

Add on how much it is likely to cost to do all the work - adding in a contingency..

How much is it likely to sell for then when that is completed. Base that on local sold prices (not asking prices).

Take that away from the earlier figures, and see what is the POTENTIAL gain to be made.. but not guaranteed - how many times on the Sarah Beeney programs is a profit made only because prices went up in an area..

Property programs also advise that sometimes just getting the planning permission for extending can also add value as it takes the risk out of a buyer then having to apply..

Do they have the funding in place to complete those renovations and then wait for a sale?

orchid2010

Thanks for the replies.

The property is not a traditional end-terrace house, it was one of a block of 4 cottages which were built to house worker's for a small holding which has now been completely built on. All the other house's and bungalow's in the street are large family homes which were built from the 1930's onwards. They are the only properties of this type in the area, with parking in the front garden and very large back gardens. Technically it is the worst house on the best street.

rrtt

As I'm currently looking for my dream home, here's a quick reply

Assuming all my basic requirements were met - ie size of house, size and privacy of garden, location - I'd put my wishes in the following order

My first choice would be a home done up to my liking in terms of layout, materials, etc that I could move straight into without having to do any work on it except a bit of decorating maybe

Second would be where some work needed doing but pp had already been granted

Third would be a "project" where pp had already been granted

Fourth would be something already done up but not to my taste - layout wrong, basic materials wrong, decoration wrong - because what was already done would be reflected in price, but you'd have to rip it all out and start again ...

Fifth and last would be something which was a project but which had no pp - too huge a risk, and even if granted, oh the bureaucracy and even the thought of the bureaucracy ...!

Fire_Fox

orchid2010 wrote: »

Thanks for the replies.

The property is not a traditional end-terrace house, it was one of a block of 4 cottages which were built to house worker's for a small holding which has now been completely built on. All the other house's and bungalow's in the street are large family homes which were built from the 1930's onwards. They are the only properties of this type in the area, with parking in the front garden and very large back gardens. Technically it is the worst house on the best street.

Large back garden definitely shouts potential to get outline planning permission.

vegasbaby100

I would buy it as is but then again all the houses we buy "have potential". because we can design it to fit our lifestyle at the time I would always go for something that needs work. We have already started tearing down walls and gutting perfictly good kitchens and loveley wallpapered walls.

I think as mentioned above it depends on the area if it is a "slow" area and lots of competiton it could be tough but if it is in a desirable area with good schools it will sell, good houses will always sell if priced reasonably.