Big Garden & Good Orientation V Needing work

kennyb3

What are people's thoughts on this? Say you find a nicely located house, big back garden with room for extension.

However the house needs work - new kitchen, new carpets, new windows, paint of all rooms, maybe even a new bathroom. Cost? (maybe 20k)

The couse is priced roughly at 20k less than a house that is in mint condition.

Obviously the bricks and mortar (location) are the most important aspect that much is obvious - but the issue is trying to get/raise the 20k to do the work. Then you either can't move in and have both rent and a mortgage to pay (or move in with family). Or you move into a new home that's pretty messy. (and you'd prefer not to show off)

How much would this put people off buying?

Do you look for a ready to go (or very near) house?

If not thoughts on how to get the 20k together - borrow from credit union?

I just think this is an interesting topic to see what level of work irish people are prepared to take on.

Scortho

I'd go for the house that offers me the best value for money. Also I'd like to put my own stamp on a house so when it comes to buying ill most likely look for one that I can renovate. That said I'm not afraid to roll up my sleeves and get the oul hands dirty.
If there were 2 identical houses, one requiring work to the tune of 20k and the other is in walk in condition, and there is 20k in the difference, I'd go for the one that's 20k more expensive as I'd want at least 10k extra for the hassle of renovating.
There'd be very few houses though where I wouldn't be repainting and changing floors. bathrooms, kitchen and painting within 3 years.
If the house was habitable I wouldn't mind what colour the carpet is or how filthy it is...there's rug doctor for that, or if the bath is straight from the 1970s they can be changed gradually as money becomes available.

I'd definitely chose brick and mortar and garden in a location i like over a house in a location that I don't like with a tiny garden and a house that doesn't work even if the house with the garden needs a bit of tlc. However the price should reflect this.

StillWaters

There is nothing in that list of work that needs to be done immediately. Move in and save the €20k or get yourself in a comfortable position to borrow some of it.

xper

Your enquiry is very broad.

Some houses are presented in turn-key, high-spec condition. Some will be little rough around the edges but completely livable. Some will be a throw-back to yesteryear and some will be money pits more suited to demolition.

Some prospective purchasers would run a mile from the thoughts of getting work more complicated than a paint job done. Some would love to take on significant work but for practical reasons can't (where's the family going to live in the meantime, as you say). Quite a few will specifically be looking for a doer-upper that they can put their own stamp on.

Purchase price may or may not reflect the post-purchase investment. If its an executor sale of a run down bungalow that someone's parents have lived in for fifty years and hasn't seen more than a lick of paint in the last twenty years, the sale price will probably heavily reflect this knowing that any purchaser is going to have to throw further time and money at it. If its a decent 3-bed semi in a nice area with a large garden, one potential purchaser might be happy with it as is while someone else might be considering putting a extra bedroom/bathroom extension in. The latter is not going to see any sort of discount for their needs and in fact, will be have more potential competitors.

As an example figure, 20k's worth of after-purchase work is not particularly high. You could probably find cases of new brand new houses having that spent on them. Six figure sums spent after purchase would be fairly frequent. Of course, you could also just furnish a pristine house for well under 20k.

Swings, roundabouts, ups, downs, what ever you're having yourself.


How do you finance this? Well, you finance it the same way you same way you finance the rest of your home acquisition (of which the actual purchase price is just the biggest component, not the be all and end all of it). So your total budget is made up of your savings plus your whatever mortgage you can realistically get and handle.
Its a lot easier if you savings will cover the minimum deposit for purchase plus the after-sale investment. If you need to convince the mortgage lender that the value of the post-work finished article will be more than the amount you wish to borrow, then you have your work cut out and you'll have a long, drawn out purchase. If its relatively small amount like 20k then maybe you could get it from another source like a credit union (I've no idea how fleathulach they are these days) or family or whatever but I would take a long hard look at how deep into debt I was trying to dig myself.
I would suggest that if you have a minimum deposit saved and mortgage approval for say 250k, and a house pops up at 240k but needs 20k's worth of work then it is in fact, just outside your budget. However, if the house is habitable and the work can wait two or three years while you save the extra cash ...

Stereomaniac

Personally, I would go for the location if it's right, and if the house is liveable, would make it a gradual process, tweaking it and decorating it to my taste. However, I don't have any children so there's that consideration out of the equation for me. But people talk about putting a price on renovations here.... Any home-owner I know is forever moving onto the next thing.

kennyb3

Thanks for the responses so far. I'll give a bit more detail for some more thought.

So here's the background (the i'm no fool re price/situation part);

We've rented for the past 4 years - 1.5 in the town we wish to buy (we know it well due to family). We've waited as we knew prices would slide, and they have done - probably by 120k for a typical house we're looking at meanwhile we've spent rent of about 55k. So it's been great for us so far and we've learned loads - in terms of what we want; location wise, a green for kids, a west facing garden etc etc.

This has really narrowed us down to two estates - others are old/unsuitable for various reasons.

We've kept our eye on the market for the full time and been to a few viewings to tyre kick but with no real intent to buy until we felt things were getting close enough to the bottom (the % fall's not covering our rent). We kind of guessed this might be the 2nd half of 2012 but we got married late in the year so werent in a position to do anything (honeymoon, stress etc).

A lot of stock was gobbled up in the final half of the year and it's very low now. I'm a little worried admittedly but not so much that im paniced or anything like that - it's just a matter of being patient.

But as i said we've narrowed ourselves down to about 60 houses between the two estates due to being very picking. The house that's come up ticks most of those requirements except for the fact it's a bit of a mess.

Now how messy? Well it is a new enough house (built circa 1997) but it looks like something from the 70's/80's due to it being an executor sale. So it's no money pit and is habital - just.

I'm no handy man (very far from it) but realise it needs a new kitchen and bathroom asap, new carpets and paint in every room for me to feel anyway comfortable living there. Windows, insullation and boiler could prob be upgraded in time but are sufficient.

So my connundrum is whether to go through the works on this place or be patient and hope another suitable house turns up over the next year?

Anywhere between 2 and 6 may come up by the end of the year at a guess - hard to tell, but i'd imagine they'll generate quite a bit of interest, as there are at least 3 other parties interested (with 2 bids) in the current one. As i said the problem is more the lack of supply.

So price. I reckon about 240k will secure it - one on the same street actually sold for that in the middle of last year. It definitely needed a bit less work but still a good bit all the same.

Also would anyone care to estimate the cost of the work listed above (i'll make further enquiries anyway)

StillWaters

Personally I think you would be crazy not to buy it as your potential pool is so small.

This ticks all boxes for you, and is in budget. 1997 kitchens and bathroom can't be that bad, and dodgy carpets and paint can be fixed over a weekend.

I think perhaps you are not as ready to buy as you think you are!

Scortho

kennyb3 wrote: »

Thanks for the responses so far. I'll give a bit more detail for some more thought.

So here's the background (the i'm no fool re price/situation part);

We've rented for the past 4 years - 1.5 in the town we wish to buy (we know it well due to family). We've waited as we knew prices would slide, and they have done - probably by 120k for a typical house we're looking at meanwhile we've spent rent of about 55k. So it's been great for us so far and we've learned loads - in terms of what we want; location wise, a green for kids, a west facing garden etc etc.

This has really narrowed us down to two estates - others are old/unsuitable for various reasons.

We've kept our eye on the market for the full time and been to a few viewings to tyre kick but with no real intent to buy until we felt things were getting close enough to the bottom (the % fall's not covering our rent). We kind of guessed this might be the 2nd half of 2012 but we got married late in the year so werent in a position to do anything (honeymoon, stress etc).

A lot of stock was gobbled up in the final half of the year and it's very low now. I'm a little worried admittedly but not so much that im paniced or anything like that - it's just a matter of being patient.

But as i said we've narrowed ourselves down to about 60 houses between the two estates due to being very picking. The house that's come up ticks most of those requirements except for the fact it's a bit of a mess.

Now how messy? Well it is a new enough house (built circa 1997) but it looks like something from the 70's/80's due to it being an executor sale. So it's no money pit and is habital - just.

I'm no handy man (very far from it) but realise it needs a new kitchen and bathroom asap, new carpets and paint in every room for me to feel anyway comfortable living there. Windows, insullation and boiler could prob be upgraded in time but are sufficient.

So my connundrum is whether to go through the works on this place or be patient and hope another suitable house turns up over the next year?

Anywhere between 2 and 6 may come up by the end of the year at a guess - hard to tell, but i'd imagine they'll generate quite a bit of interest, as there are at least 3 other parties interested (with 2 bids) in the current one. As i said the problem is more the lack of supply.

So price. I reckon about 240k will secure it - one on the same street actually sold for that in the middle of last year. It definitely needed a bit less work but still a good bit all the same.

Also would anyone care to estimate the cost of the work listed above (i'll make further enquiries anyway)

If the house was built in 1997 there's very few houses, unless they've been upgraded in the meantime, that wouldn't need a new carpet, kitchen and bathroom. In 4 years time it will be 20 years old and most people would change their interior by this stage anyway.
That said even though nothing has been done to the house since it was bought, it doesn't mean that the kitchen or bathroom isn't functional it just isn't going to be a modern one.

On the issue of cost, you can get a basic kitchen from 3000. Bathroom from 1000. However it all depends on the spec you want. I've seen people spend 60-70k on a kitchen. Likewise some people will spend close to 1000 on taps for their bathroom.

One possible idea for the kitchen if you're stuck for cash is to paint the doors of the presses.. You'd be amazed as to how much of a change this can make to your kitchen

kennyb3

Thanks guys, this is definitely helping.

@stillwater, appreciate that but i think it's more i never considered a do-er upper really. Now it's suddenly trust upon me and taken me a back a bit.

The house is totally habitable. I'm prob being a bit snobby/stupid really thinking what will our family think we've bought even though i know we could make it gorgeous in less than a year.

The fact we currently live in a new build show home nearby (but not suitable for bringing up kids hence its out of the equation)doesn't help - the place is just too prestine.

StillWaters

kennyb3 wrote: »

Thanks guys, this is definitely helping.

@stillwater, appreciate that but i think it's more i never considered a do-er upper really. Now it's suddenly trust upon me and taken me a back a bit.

The house is totally habitable. I'm prob being a bit snobby/stupid really thinking what will our family think we've bought even though i know we could make it gorgeous in less than a year.

The fact we currently live in a new build show home nearby (but not suitable for bringing up kids hence its out of the equation)doesn't help - the place is just too prestine.

That's not a doer upper! A doer upper needs Walls knocked, dodgy extensions knocked etc. What this is is a project, there is a huge advantage to doing something up to your own taste, rather than living with someone else's paint and kitchen taste.
just be prepared for spending weekends in ikea and b&q, and getting bitten by the bug! You don't have to be handy. I'm not, I'm a woman who doesn't know how to use a drill, but I've tackled jobs much bigger than this on my own. You just need good handymen!

Who cares what your family think. They aren't paying the mortage are they?

xper

kennyb3 wrote: »

A lot of stock was gobbled up in the final half of the year and it's very low now. I'm a little worried admittedly but not so much that im paniced or anything like that - it's just a matter of being patient.

Stock is low right now. The MIR-frenzy at the end of 2012, widespread negative equity and the fact its a naturally quiet time of the year anyway means a low supply right now. It should pick up a bit later in the year. That said, if you're decided on just a couple of estates, the general state of the market is less important. WIth such a small target area of 60 houses, the rate at which potential purchases become available will be more random.

Well it is a new enough house (built circa 1997) but it looks like something from the 70's/80's due to it being an executor sale. So it's no money pit and is habital - just.

Fifteen years old is not new. The building regs, materials and practices have changed considerably since then and that's a fair bit of wear and tear. On the other hand, built before the full boom madness had peaked, its less likely that this house is a thrown-together mess.

I'm no handy man (very far from it) but realise it needs a new kitchen and bathroom asap, new carpets and paint in every room for me to feel anyway comfortable living there. Windows, insullation and boiler could prob be upgraded in time but are sufficient.

New carpeting and painting for a house purchase is almost a given and really trivial to do in the greater scheme of things. Installing a new kitchen and bathroom is also something that you are very likely to do at some stage so doing it at the outset is probably a bonus.
Windows, insulation and heating system work is actually far more disruptive as you start interfering with the building structure. Also more expensive asa result. So ideally you would do this before moving in but money and time may not justify this, especially if what's there is okay for a while.

Bear in mind that if you are successful in your bid and go sale agreed, you'll probably have several weeks before the sale is closed to start lining up people to carry out the work and decide what you want to do exactly, pick out your materials,etc. If its an executor sale, presumably the house is empty so the sellers might be amenable to allowing measurements to be taken. Get the workmen in there as soon as the keys are handed over and, with the place to themselves, they should be able to finish the work in very short order so the penalty of staying your rented accommodation a a little longer may not be too onerous.

So my connundrum is whether to go through the works on this place or be patient and hope another suitable house turns up over the next year?

With such a small pool of potential targets, waiting for another chance for what are standard upgrades, some of which you'll probably have to go through in the next target at some stage or another, seems silly to me.

So price. I reckon about 240k will secure it - one on the same street actually sold for that in the middle of last year. It definitely needed a bit less work but still a good bit all the same.

Well if an otherwise identical house sold for X last summer when MIR was still available and it was in better condition, I'd be bidding quite a bit less, 220k maybe? On the other hand, if you are getting into a bidding war, you may not have that luxury.

kennyb3 wrote: »

@stillwater, appreciate that but i think it's more i never considered a do-er upper really. Now it's suddenly trust upon me and taken me a back a bit.

If you are going to own your home, you need to continually spend money maintaining it. Building standards (and fashions) will change. New technologies will become available and existing fittings will wear out. You are looking at houses that are 15 years old and, if you intended raising a family there, will be 30-40 years old when you are still living in them. I don't see why you should baulk now at having work done when you inevitably will be doing this at some stage.

The house is totally habitable. I'm prob being a bit snobby/stupid really thinking what will our family think we've bought even though i know we could make it gorgeous in less than a year.

Yes, get that silly thought out of your head!

The fact we currently live in a new build show home nearby (but not suitable for bringing up kids hence its out of the equation)doesn't help - the place is just too prestine.

I've yet to see a house with kids living in it that was pristine. Just doesn't happen.

kennyb3

Great input, massive thanks all

You can make changes to the house needing work over the years to your own taste.

You can't change the size of the garden or the orientation on the other.

quietsailor

kennyb3 wrote: »

But as i said we've narrowed ourselves down to about 60 houses between the two estates due to being very picking. The house that's come up ticks most of those requirements except for the fact it's a bit of a mess.

Now how messy? Well it is a new enough house (built circa 1997) but it looks like something from the 70's/80's due to it being an executor sale. So it's no money pit and is habital - just.

I'm no handy man (very far from it) but realise it needs a new kitchen and bathroom asap, new carpets and paint in every room for me to feel anyway comfortable living there. Windows, insullation and boiler could prob be upgraded in time but are sufficient.

Be very very careful thinking this way - these are among some of the messiest jobs you can carry out in a house, replacing a boiler might mean replacing a lot of pipework. If that's the case your ripping down walls and while you can live in a house while this is happening it's hell - especially if you have small children

If you have the money I would suggest getting a tradesman to look at these jobs and ask them what amount of work is needed - ie straight swop of the boiler or a major re-pipe of the house

kennyb3

quietsailor wrote: »

Be very very careful thinking this way - these are among some of the messiest jobs you can carry out in a house, replacing a boiler might mean replacing a lot of pipework. If that's the case your ripping down walls and while you can live in a house while this is happening it's hell - especially if you have small children

If you have the money I would suggest getting a tradesman to look at these jobs and ask them what amount of work is needed - ie straight swop of the boiler or a major re-pipe of the house

Thanks, any offer would of course be subject to a surveyor and i've a good chartered engineer lined up.

I have plumbing connections also so that side of things wouldn't worry me at all.