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Investing in a renovation project is a popular way for many people to get more money back from the sale of a house than they have originally put in. Of course, there are occasions, where during the mad scramble for a bargain, many people continue to bid on a property, driving the price up. Where this happens, it is important to know when to stop bidding as you nay not end up with a bargain at all.
Knowing the ceiling price for the area you are bidding on a property in is crucial. The ceiling price of a property is the price that buyers will not pay over for a house in a particular location, no matter how much work you put into the finish of the property.
When viewing the house, give yourself some time to look at other houses in the local area, as this may give you some indication of what sort of work you could carry out on the house and the type of property buyers would expect in that area. Looking at properties in the local vicinity may also give you an idea of what works have been granted planning permission. You could even ask nearby neighbours if they have ever been declined planning permission for a project.
If you are serious about bidding on a property, it is wise to get in touch with a chartered surveyor and ask them to carry out a building report. If, after inspection, you’re chartered surveyor suspects infestation, damp, drainage problems, subsidence or heave, they will advise further inspections to be carried out.
The report compiled by the chartered surveyor will detail the type of construction methods that have been used in the house, helping you to plan your own renovation more effectively, and ensure the materials and methods you use will be suitable.
Aside from the price of purchasing the property and the fees that come along with this, there are other fees that should be taken into consideration when purchasing a renovation project.
Fees to Budget for:
Council tax
Valuation fees
The purpose of a valuation fee is to assess whether you’re property is suitable security to lend on.
Reconnection fees
Many properties up for renovation have often been vacant for a period of time. Where this is the case, you may need to connect or re-connect the water and electricity supplies.
Professional fees
You will need to have a wide variety of surveys carried out on your property, which may include,
planning permission and Building Regulations approval, structural engineer reports or even tree surveys.
Contingency fund
As with any renovation project, you are likely to find unexpected things that eat away at your budget. To help you manage your finances, it is wise to have a contingency fund so you can deal with these costs, without taking away from money marked for other things.
Legal costs
Legal fees can cost anywhere between £500 and £2,000 for a solicitor or conveyancer to act on your behalf.
As soon as the contracts are exchanged on a house, you become responsible for the site. Consequently, having appropriate insurance in place becomes vital. You may also find that your mortgage lender will not release any money until they see proof of the insurance.
For a renovation project, the insurance should cover public and employer’s liability, building materials and work, tools, temporary buildings, the existing structure, personal accident cover and legal expenses.
A warranty is not a necessity, but if you decide to get one, you should apply early on in the renovation process, as the deeper into the project you get, the more you are likely to pay.
Warranties typically last for 10 years and will cover your house against flaws in the design, materials or quality of the build and the issues that may occur because of these defects.
There is certainly no requirement to hire an architect, but when it comes to large and costly renovation projects, you may find hiring the services of an architect helpful.
At Boss Construction, we have been commissioned to carry out work within many properties undergoing renovation. Our team works to the highest standards in an efficient manner to help your vision turn into a reality. If you require the help of our team of trusted builders, please call today on 0121 353 8181. You can also send your enquiry through to our online contact form and we’ll be in touch as soon as possible.