How can you know you can afford the work before offering on a fixer upper?

[Zooforhouse]

Have found a house, would like to offer. It has active planning permission (although not sure we’d follow those plans).

How can you know you can afford the work before buying it? We’d have a (feels like) significant budget but concerned that it won’t stretch.

is there a way? Or is this always a massive gamble?

Get a full building survey, get the work costed and add 15% as a contingency.

Even with a survey, you never know what might be revealed once you start work, surveyors can only go on what they can see.
No one can predict the cost of materials (or labour) beyond the next few weeks/months, as we have seen recently anything can happen.
So it's a risk, but maybe if you break the work down into separate projects you can live around it?

it needs windows, full decor and a kitchen extension.

one day into loft

I think could do it but daunting (also have SE tax to consider 🤔)

Will people cost work when you don’t own a house yet?

We bought a major fixer-upper. Our surveyor went over it very carefully and put together a schedule of works, and got a couple of detailed quotes for it all (a new window, a French drain, new secondary glazing, repairs to cracks in chimney, woodworm treatment, new boiler... The list went on).

We waved these quotes at the estate agent and got some more knocked off the price. So that's one route to try.

We brought the cost down a bit by redocrating ourselves, and held off on some of the work for a couple of years - you don't have to do it all at once. There are still a few things I'd like to do.

In the end the house is worth far more than purchase cost + renovation cost. I'd do it again.

I should add, find a surveyor with a good working relationship with a couple of builders. We knew ours already from our previous fixer-upper so there was a lot of mutual trust, which really helps.

Where do you all get the capital from?!

Educated guesswork. Plus, accepting that a doer-upper can take years to do up.

The survey will tell you if it's structurally sound (or not) and any obvious damp,. rot, infestations .
You can see for yourself if it needs new windows, rewiring, replumbing ,a new heating system, (jobs we've never undertaken DIY) . Either, get a rough indication of costs from a competent contractor ( pay for his time to visit and take a look. Or , ask friends/neighbours who had comparable work done.

From experience, we've always been prepared to live with functional but dated kitchen/ very basic bathroom/ hideous decor etc for as long as it takes until we can afford the time or money to change them.

By living in a place , however basic it is, you get a far better idea of what it needs to improve the place to suit yourselves. By taking your time, you can learn new skills and achive / afford a quality finish at a slow pace and budget to suit your circumstances.

@Tippexy
Its possible to sell a house for more and buy a cheaper doer upper elsewhere. In a cheaper location. Life assurance matures. Granny dies. Some people get bonus payments and save. Others borrow.

15% contingency is not enough at the moment. 30% is more sensible. Any roof issue, drainage issue and foundations problem will eat into 15% and gulp it down.

Our funds would be equity on current house and savings. We would put down a lower deposit and mortgage higher. This is would mean there would be little capacity to go over budget.

it needs new windows, new wiring, plumbing, a single story extension, minor reconfiguration and a couple of bathrooms and then kitchen/utility fittings. We would get a survey and be prepared to walk away if structural issues. We are pretty hands on but would be limited on what we could do ourselves due to young kids and jobs! We would plan to move out for a bit. We would have 200k if offer successful (think house will be popular-may not be anyway) I don’t really like talking finances, but I guess no one on here knows me and maybe gives a better picture. It’s a detached, 30’s build with solid brick walls. It needs some love…

i am aware that no one on an Internet forum can tell me what to do 😂

Id be happy living in it as is for a while (windows excluding-but have budget for that). Would like to feel like was making progress though….

We asked a builder we'd used previously to come round and give us a quick look and a finger in the air estimate that we said we wouldn't hold him to. We also costed out the work with the help of an architectural technician and ringing round people to get a rough idea.

We made a very detailed spreadsheet - so flooring, curtains, decoration, applicances, garden work etc as well as the building work.

It hasn't been far off that - and the contingency. (10%).

Thanks. Sounds like you are good at maths 😂

Yes we took a builder with us on a viewing when we were clear what we wanted to do.....wasn't a quote as such but a guide...

with Benefit of my own hindsight I’d be staying well clear in current climate

basically budget is only half of it- trying to find a builder who will actually do the work is stressful, massively time consuming, full of disappointment and frustration. By the time you actually have someone organised and planning approval any initial quotes you got will have gone up massively.

I completed last June. Got a reasonable discount on works shown by survey . Got builder and architect recommendations. 7 builders and 10 months later the costs have now gone up form £30k to over £69k (and I’ve pulled out some of the works). . It is a stressful and frightening amount of money . I still have no confidence that builders I now have will start when they say they will or even turn up. If a more lucrative contract comes up they will walk despite me having a contract with them signed.

so, it doesn’t matter what you are being quoted. That’s just a vague estimate now. It will only matter when you have a builder ready to start work and he gives final quote. I’d say whatever that figure is, double it.

I would run for the hills if I could

You can't know unless you are a billionaire. Work takes time to organise, and prices go up and down.
If prices go up it just means you have to save for longer before the work gets done.
Concentrate on making the house weathertight so it doesn't get any worse, secure to prevent breakins, and safe.

Then set your own priorities for the rest.

Take rough estimates with a massive pinch of salt. We were told £10k to sort the roof actually £40k. £4k for the rewire is currently £6k and it's not finished. Plumbing and heating was not thought to need much doing has ended up at £6k. Everything is so expensive. Lots of jobs we're not going to bother with for several years now.

I did something similar with a similar budget and to-do list. The estate agent can help you find a builder to give a rough quote but most decent builders will be too busy to bother wasting their time on it. Prices are higher now though than when I started. I have learned that you can do quite a lot yourself if handy! If I had my time again I would project manage and use separate trades so that I maintained full control of the project.

I saw a house that needed lots of work. Got a builder friend to work who said walk away. You will spend more than it will ever be worth. So I'm still looking.

Bad time to buy a house

We bought a doer upper with basically zero budget. We paid for a full rewire and since then have done almost everything ourselves, all patching, plumbing, ripping out, decorating. We have paid for one day of plastering and carpet fitting. We've probably saved £10k+ in labour already. We will fit a new kitchen when the time comes, and save to have the bathrooms done over time. We are knackered 😂but needs must.

You have to really love the house I think. We bought a fixer upper and 7 years later we are still doing stuff. Bigger renovations went on hold (due to finances and not wanting to borrow any more) and now will probably be put off for good, given how much everything has gone up and how hard it is to secure tradesmen.
Concentrate on costing the bare minimum you could get away with doing and be happy with. Keep a decent contingency up your sleeve and accept that you may not be able to afford the ideal. If you can live with that, then the house is still worth it.

Looking at extending.

spoke to a ‘tame’ builder in the pub. His rule of thumb is £1,300 per square meter for ground floor and £1,000 per square metre for first floor. This is to finished plastered walls but not decorated or furnished.

We’ll be waiting a while.

A couple of detailed builder’s quotes in addition to the survey.

These are the sorts of figures I was seeing when looking online. In reality we had 4 quotes for a 12m squared basic ground floor extension not top spec at all to plaster finish, no planning needed. Very straight forward job. The cheapest quote was £28k and that was very much back of a fag packet so I'd expect that to actually be much higher. This was pre covid too and not London or SE. £40k was the average sort of quote we had and I'd expect that to be much higher now. Then we'd need to pay for new kitchen etc. Doesn't seem worth it for the space we'd gain

What we did was to go round with a builder and an architect, who were both much more use than a surveyor in terms of working out what the work needed might be (and cheaper!). The only surprises we had were two old beams which had been boxed in and needed replacing.

Having said that, Grand Designs is a really good guide to what will happen. You will have big ideas. You will budget for them. At least one of your Big Ideas will bite the dust. Work will start, at least one supplier/trade will be an arsehole. How ever much you look at every single cost (I project managed ours) it will go over and you will lose another Big Idea. You will finish most of it but run out of money and stop for a while. You will live with that really ugly back door for two years and not notice it. Eventually you will tidy up the bits that need doing. At this point something you installed will break...

We work out a very average cost of a job as per estimating sites and so on, and double it. That's usually about right. Then add on a good fat contingency for all the jobs you only find you need to do as you strip stuff off to do the ones you did know about.😝Dragonatethe parsnips' post is pretty close to the truth as well as a good laugh.