Buying a major project

rebeccatom

Hi,

We have seen a house which is very run down (has a family in there so is livable, but i wouldn't want to:eek:). If we were to buy it, we would basically need to take it back to brick, full rewire, re plaster, tank the cellar as it has some damp, new kitchen & bathroom etc.

We are in a good place to do this as we can stay where we are while the work is done, and we have the finance to do it.

But is there anything else i need to take into account. Would it be a problem getting a mortgage when we are going to strip it bare? do we even have to tell them?
would i need extra insurance policies for the work being done?

Any advise from someone that has done this would be gratefully received.

holly_hobby

The extent of renovation will affect the survey valuation and any retention of funds - which will depend upon the surveyors comments and any expert reports reqd.

The very basics for mge suitability, are that the property must be structually sound and habital, ie functioning kitchen and bathroom - not meeting the requirements can result in a full or partial retention.

Upgrading from the 70s, is cosmetic, as is GCH and double glazing, which may affect the value but I wouldn't expect a retention.

You may want to look at buildstore whom offer renovation mges = http://www.buildstore.co.uk/finance/renovation.html.

Hope this helps

Holly

LEJC

we have just finished a full renovation project and its taken us a year.
We were in the fortunate position of inheriting the house so no mortgage required although we took a budget of £40k as our starting point and basically striped the house bare...again probably I would class it as a house that had had nothing major done to it for about 40 years

In terms of what we found difficult...things never run to time so allow much longer for each component of the work to be carried out....weather effects some aspects and in terms of last year and the rain a job that should have been completed by july over ran to november because there physically wasnt 3 dry days.
I went into the renovation thinking that 3 months would be plenty of time, that bit over ran to 6 months....so allow plenty of time unless you have extra cash that you can get additional people in.

Have a contingency fund ours was £5k and once we factor in running costs of the house then I think that will probably be spent.
You will need to check with your local council if you can claim a council tax subsidy...although a lot of councils have now stopped giving any form of renovation concession,be that empty property or uninhabitable and even single person discount.....so you may find that a full council tax is required for the duration of the refurbishment even if you are not living there.
also bear in mind that utility bills such as water and electric and gas are also payable...the gas and electric in some ways can be controlled but there is no reduction on water bills.

In terms of insurance you need to speak to an insurer who will probably sell you a basic insuance policy...there are condoitions attached but in essence you do pay slightly more than the home insurance cost of an occupied property.

It really is good if you can manage not living there ....its no fun living through a renovation and our saviour was the fact that we could close the door at the end of the day and go home!!!
Again you will argue with your partner...we had a policy that the argument stayed at the door and never came home with us..

at the beginning work out what needs doing and approx costs and seperate the list of to do things into things that you cant do and need to get someone in...things that you could do if needed...and things you will do yourself.

We had trades in for the major work but also said if funds allowed we would get decorators in...unfortunatley we couldnt accomodate that in the budget so have spent the last few months sanding,stripping repainting etc.....but if there is prep work like wal;lpaper stripping that you can do,then that will certainly reduce your trades costs as its a simple thing that can be done diy

Our carpet goes in next week and we are officially finished...its been a long and interesting journey...in the beginning I vowed never again...but rental number 2 is somewhere on the horizon!!!

rebeccatom

Thanks, that's really helpful! Sounds like you have done a great job and it is all worth while in the end.
Going for a second viewing with a builder is the next stage.
Obviously we know that there could be other things that they won't find until work starts but I guess we have to begin with something.

AlexMac

Take out a sub to 'Homebuilding and Renovating' - usually cheap deals for 1-2 year subs on their website. Informative and inspirational.

I_have_spoken

Or get a copy of Holmes' "Renovating for Profit", even if you're not looking to sell on it cover legals and financing