How much to offer for a place needing much modernisation work?

[proteins]

Hello,

We are considering buying a 2 bedroom Victorian semi-detached place with an asking price of 220K. This place needs central heating (at least 5K), rewiring (about 3.5K). It would also require a new kitchen, new flooring (only floorboards at the moment). We estimate that it would need in total about 15K of work done. We have a tight budget, this is only just be doable. There are other works that would need doing (eg. roofing, windows) but we thought we would live with that until we built up the finances for them.

The equivalent houses in the immediate vicinity sold for about 240-250K, during the past few years. I do not know the state of these houses when they were bought, and they do not come up very often in this area.

Is 180K an unrealistic offer for this place? Neither my husband nor I have any experience in "doing up" houses. We will be arranging a second viewing with a builder, are there any questions I should be asking/not asking?

Any anecdotes of similar experiences would be gratefully received!

[proteins]

N1MTB Thanks for the 'developers' rule of thumb, I didn't know about that. I was told that there were a few developers viewing on the open day, so that's really useful to know.

It seems very indulgent to pay more for the privilege of ripping it all out doesn't it? I keep telling myself that it's just a roof over my head and it really doesn't matter if it's not a reflection of my taste and preferences. So this place which needs the renovations gives me the perfect way to get things the way I want. I imagine lots of people feel this way.

[N1MTB]

That's ok! In your favour though, lots of sellers don't like selling to developers. Not sure why - probably sentimental reasons but maybe they just don't want to see somebody else make more money out of it than them! Let us know how you get on!!

[befuzzled]

that developer rule seems about rightwhere we are

[kizzie]

I would offer £190k with aim of paying no more than £220k. Will all depend on whether someone else wants it. Godd Luck!

[proteins]

Thanks for all the good luck! I will update with builders' estimates and take it from there

[kizzie]

sorry typo - meant to say not more than £200k (not £220k)

[GnomeDePlume]

We have developed a couple of properties. Both times the previous inhabitants had moved out to care homes so the families were selling up. They were just interested in a quick sale so didnt care who we were. On the other hand people dont like buying from developers, dont like us making a profit (think we should do all the hard graft for free!).

From experience you can cut the cost by doing as much of the work yourself as possible. The big structural work is surprisingly inexpensive, it's the fiddly detail which costs.

My DH (an electrician) is keen to work with DIYers where they want to do the electrics as part of a larger project. I think that quite a few of the one man band trades are like that (at least the ones we know are).

[proteins]

GnomeDePlume I'll remember to keep my eye on the fiddly details. I am surprised by how affordable the big stuff are (eg. rewiring, complete new central heating) but then I haven't budgeted for any finishing work at all! What are examples of the fiddly details you have in mind?

We are prepared to do some DIYs ourselves (sanding, painting etc), because we cannot afford for people to do it for us. We're just very inexperienced and worry about bringing the entire structure down on our heads!

[GnomeDePlume]

Paint, paint brushes, rollers, sandpaper, all absorb money like a sponge.

A couple of top money saving tips

• pick one colour and use that everywhere - B&Q do a good range of 'everywhere' paints. Pick a single neutral colour which you can then use in all rooms and not end up with dozens of half cans. When budget is tight dont worry about using 'posh paints'. You need a satisfactory finish which you can then touch up easily if it gets damaged as furniture is moved in and about.
  

- when painting, at the end of the session wrap the brush or roller in cling film. You can then use it the following day without needing to wash it out.

Again, by using a single colour you will use fewer brushes and rollers!

Stick to standard, make a decision and then stick with it. Variation in any contract will cost extra, sometimes a lot extra.

- Measure, measure and measure again then cut.
- You can cut shorter but you cant cut longer

The above mantras are always moneysaving!

Good luck and enjoy!

[proteins]

An update!

The builder has quoted us about 50K (VAT inclusive) for the work needed to the house. A breakdown goes as follows:

Central heating (there is none at the moment): ~10K
Rewiring (it's a death trap): ~5K
Some plumbing (replacement of gas pipes, lead pipes etc): ~1.8K
Roof: 14K
Windows and doors (replace with UPVC): 9K
Knocking down a wall (non-load-bearing, to form kitchen-diner): ~700
Installation of new kitchen: ~6-7K

I am sitting here punching my calculator and seeing deficits everywhere. Especially when I add a safety margin of 20% on top .

The kitchen seems a little expensive to me, though it does include all supply and installation of units and appliances. There is no indication of what units and appliances would be supplied..

Anyone has comments on those numbers?

[Geordieminx]

Is the builder a mate or is it someone from yellow pages? Couple of those figures seem a little ££... Get a couple of quotes? I guess you can ho back to vendors with a couple of quotes and use them to support and offer of £180k.

Will you be ok with mortgage if house needs all of this work?

Have you had a valuation done?

[proteins]

Hello Geordieminx We got them from Checkatrade. They're a small group, but seem to have good reviews.

I've called around asking for phone estimates. But without having the builder there to actually see the work, I dare not take those phone-estimates too seriously. And I am not sure I can arrange for another viewing with another set of builders.

The agent called and said there has been an offer made by another FTB, who also went round with a builder. I think we will be ok with the mortgage if we defer some of those items on the list. For example, the roof is apparently not in too bad a state, and can probably wait five years. Also, I can live with old windows and doors, it doesn't need to be double glazed immediately. Although there is a crack on one of the windows, being held together with tape

[Geordieminx]

No idea how much the other offer was

[proteins]

We tried to fish for details (I hope we were discreet... probably not ). But no luck.

[Geordieminx]

I guess it just depends on how much you want the house nd how much you can afford to pay taking into consideration the amount of work needing doing. Nothing to stop you offering £170k.

I would put money on the FTB's pulling out once the structural report comes back if their offer is higher than yours....

[VivaLeBeaver]

Some of those figures seem high, though I guess prices may be more down south. We had our house roof done last year. We,re a semi and us and neighbours had both houses done and split the cost, our share was 2.5k. Massive roof when looking at both houses together.

Does all the work need doing or is some of it stuff you want doing?

The problem with these typemof houses is that they're very attractive to people who are either developers or who can do the work themselves. For instance my dh can do elecs, plumbing and building. We would only need to pay for someone to do the roofing and for installation of a new boiler for the central heating. So costs would be minimal and we could therefore afford a higher offer if we really wanted the house. As houses that need doing up are in short supply in a lot of areas then they often go above what their Market value should be if you see what I mean. I would rather spend 220k on a house that needed 50k of work doing on it if we only had to pay for 10k of work than pay 240k on a finished house. Saves me 10k.