Buying property can be exhilarating. It can be easy to overlook what are likely to be minor issues when you’re keen to seal the deal. But as we’ll explain here, it’s important to take a slow, calculated and considered approach to avoid the ‘money pits’ out there and protect your hard-earned ready-to-invest pounds.
Here’s what you need to pay close attention to when viewing a property…
Are any of the walls discoloured from ground level up to a couple of metres high, is the paper peeling or do they just feel damp? If so, a damp-proof course will be required which is not only a costly job it’s also disruptive as the plaster needs to be knocked off back to the brickwork, meaning total re-decoration will be required too.
Check how many rooms are affected and get pricing from a local contractor before you commit. Don’t forget to factor in the knock-on costs too.
Damp that’s coming in through the roof or even the walls. It’s important to find out what’s causing this as roof repairs can be expensive. Again, find out how much the repairs will cost before proceeding to contracts.
Mould is another sign of dampness. This could be down to rising or penetrating damp, or it could be a condensation issue. Has the property been empty for a while with no ventilation? That could be the simple cause, but again it’s important to investigate to make sure there’s no serious issue causing mould to appear.
Uneven floors and cracks in internal and external walls are all red flags. Subsistence is a major issue which not only affects how safe the structure is, it can also make it difficult to get finance and insurance. Have a structural survey to check the integrity of the building.
Older buildings may have moved slightly over time with no risk to the structure, but this is something that must be checked out.
Properties that are of ‘non-standard’ construction can look like bargains but there’s a reason for that – it will be very difficult to get finance. Not just for you, but for any future purchaser – meaning you could have trouble selling in the future.
Standard construction means the house is built from brick or stone with a slate or tile roof. Any houses that don’t conform to these standards are often deemed to be non-standard construction.
If the sockets, switches, or consumer unit appear to be particularly old, they’re unlikely to meet modern safety standards and it could mean a costly and disruptive electrical re-wire is needed. There’s also a practical question to be considered too – are there enough sockets in place for the modern occupier, or will you need to add more?
The first question is, does the property even have central heating? Seeing if there are any radiators is a quick tell. Some older properties, especially those ripe for renovation, might just have electric heaters that may not confirm to current safety standards.
Putting a new boiler in and a full central heating system in place is expensive, so factor this into your budget.
Check the roof as well as you can. Stand across the road at the front and at the back of the garden to get the best view. You’ll want to check the condition of the roof in general and particularly to make sure there’s no gaping holes or tiles out of place. A leaky roof can cause a cascade of problems for the property in a short space of time, so get any problems fixed right away.
If you feel that the owner or the agent doing the viewing isn’t being particularly forthcoming or side-stepping questions, it’s a warning sign. Probe as much as you can and if it doesn’t feel right do some more research. Thankfully, your surveyor or your solicitor should spot any issues that may prevent you from proceeding with the purchase but there’s costs associated with each, so it’s worth finding out as much as you can yourself before getting paid help involved.
Are there random spots of fresh paint? Large furniture in strange areas? Is the seller being funny about you accessing certain areas?
Again, these are red flags and you need to look deeper. They could be hiding something like rising damp behind the sofa.
The other crucially important thing here is, surveyors won’t move large items to check every last inch of the property, so you need to do this yourself.
Desperate sellers are generally good for investors, but you need to know the reason for their desperation. If it’s related to the property not their circumstances for example, the same issue is likely to be a concern for you too.
Find out as much as you can.
Yes, sometimes the best investments are in the most deprived areas but managing properties in certain areas can cause more problems than having the investment is worth. Check the neighbourhood out at different times of day and on different days of the week to decide if it fits with your portfolio/investing style.
If a large portion of the property has a flat roof there is more chance of it developing a leak and as a result it can be more costly to insure which is something to consider when budgeting.
Another potential insurance issue to consider. That large oak tree in the garden could potentially damage foundations, whilst that nice stream running past the end of the garden could lead to flooding.
Some pest problems are more troublesome than others. Some pests just require a single treatment from a pest control specialist, while others, such as those that feast on woodwork, can cause large-scale damage that could be very costly to repair. Check under any carpets to see if any floorboards are affected.
It’s not always possible to know every last thing about a property prior to purchase, especially if you are planning a full refurbishment. Always plan a contingency budget of around 10% of the planned refurbishment cost for unforeseen issues.
If you know what to avoid and budget properly, there’s a lot of profit to be made. But just remember, when you’re building your property portfolio it’s just as important to avoid the money pits as it is to find great deals. One bad property can set you back significantly, so it pays to do your homework.
Another way to avoid problem properties is to work with reliable sourcers. Property Deal Store matches sourcers to investors, and best of all, it’s free to sign up!
Sign up here now to have a look at all our latest deals. When you sign up, you’ll also get access to a wide range of resources designed to help you on your way to property success!
-Chris Faulkner, director and co-founder of Property Deal Store