If you're a budding developer, the most common strategy is to buy cheap, renovate and sell it for profit. But renovation and internal reconfiguration is not just for property developers, many home owners today are deciding to renovate their property rather than moving. For those looking to renovate for profit, there are a number of key points to consider if you wish to avoid buying a money pit and running out of money! First of all check how long the property has been up for sale, properties that have been languishing on the estate agents lists for more than a few months suggest there may not be a great deal of profit to be made.
If considering many jobs will not become apparent until renovation begins so be prepared, a common phrase herd from many who have renovated old buildings is that "It cost over twice as much as I thought it would!" Remember that it costs very little to engage the services of a roofer, timber and damp specialist or electricians for advice and estimates. The amount of work involved obviously depends on the property, but don't bite off more than you can chew, particularly if this is your first project.
Using the services of a project manager to liaise with the builder and ensure work is carried out on time can often be money well spent. Whether you are doing some of the work yourself, managing the project yourself, or leaving everything to the experts, always ensure you get all the quotes well in advance and never expect the work to be finished to the scheduled time scales. Always seek as much professional advice as possible and be prepared to live in a building site for some time!
Decide exactly what work needs done before asking for any quotations. When collecting quotes write a clear specification that confirms the precise arrangements for the work to be done which includes the price, payment terms, time-scales, insurance and guarantees. Remember that your builder will be spending a lot of time in your home and in your company, so ensure you hire someone that you feel comfortable with, rather than just choosing the cheapest quote. Good communication and a professional relationship is very important for renovation projects to run smoothly.
Reputable builders will always supply references and will be happy for you to speak to previous customers and check out examples of their work. Never pay for projects up front, though scheduled payments in stages are perfectly reasonable. In addition beware of builders who require cash only payments and who do not provide their full address and contact details - if you pay a builder in cash and only have a mobile number, it is hard to pursue them when things go wrong!
If you plan to make any structural changes such as making an en suite or knocking down any walls, you will need permission from Building Control though in most cases planning permission is not needed from the council for the majority of internal alterations. In any case, check how easy it will be to get permissions or approval for any alterations before you do anything else! Get a surveyor in to check the structure of the house and find out exactly what work is required, especially if you need to replace any walls or parts of the roof as this is going to cost a lot of time and money. The surveyor should be able to provide a ballpark figure in terms of cost and you can then use the MyJobQuote free service to gather quotes and prices from local builders near you.
Simply enter brief details about your renovation project along with your contact information, then sit back and let recommended and reliable tradesman and building contractors get in touch with you! Typical renovation jobs and costs include rewiring (from £2,500-£3,000 and takes a pair of electricians five to seven days), installing central heating (£2,500-£5,000 and takes a plumber eight to ten days), adding an upstairs bathroom (cost around £800-£1,000 for labour plus around £350 for a basic white bathroom set), getting rid of dry rot will cost around £1,000, brand new kitchen supplied and installed from £3,500, replacing or re-fixing a few roof tiles will cost from £100 to £200, replacing a collapsed ceiling £400-£500 per room, woodworm pesticide treatment will cost from £600-£1,000 and replacing PVCu double glazed windows will cost around £350 per window including fitting.
No matter how organised or experienced you are, renovating is a time consuming and often stressful process, you need to carefully assess the property's potential and have a clear idea of your goals. Unless you plan to live in the property for the foreseeable future, you should ensure that you will be able to resell it and at least recover the renovation costs. Never buy without a survey, otherwise you may find yourself discovering unexpected damp, rot, subsidence and other major structural defects. A Chartered Building Surveyor can provide information on the type of construction and materials used, as well as details of any defects, including an indication of the likely cost to repair.
Avoid hiring cowboy builders by making sure that your builder is confident of undertaking the required work and has undertaken similar work before and can provide details of previous clients in your area. Underestimating costs is one of the most common mistakes when taking on a renovation project, renovation work always costs more than you expect as some problems are not revealed until you start work, but mostly it's because items are simply forgotten from the budget.
Professional renovators and developers always leave a contingency of at least 10 to 20% to cover unexpected costs - if you are not experienced plan on a contingency budget at least double this! Finally, do not undertake any work without first checking if you need planning permission and/or Building Regulations approval, always check with the local authority beforehand.