Dear Diary #2: House Shopping For A BTL Investment Begins!

House Shopping For A BTL Investment

Dear Diary,

After tumbling around on Rightmove & Zoopla for a few days, tossing properties in and out of my wish list, I managed to schedule and attend viewings for 4 different properties with a local agent.

It’s all starting to feel too real! Talk is talk, but evidently walking is a whole different kettle of monkeys.

Is it normal to feel apprehensive and nauseous at the thought of buying a property (i.e. letting go of all that cash I worked mediocrely hard to save), or am I just being a pussy?

Tips for when viewing a house

Since I was in over my head – we all knew it – and completely in over my head, I wanted to be prepared. Or at least, as prepared as I could be. The thing is, other than the aesthetic attributes of a property, what else should I be looking out for? Should I be kicking the walls and swinging on the doors to test build quality? I dunno!

Last night, the night before my scheduled viewings, I started Googling for tips to help first-time buyers not screw up. I came across a tonne of information; some was useful, others not so much (just because it was such basic information).

Here is a list of tips I found most useful, and put to practise earlier today…

Outside the property

  • Structure– take a few moments to observe your first impressions. Does the property itself look in good condition?
  • The roof– often neglected, but extremely important. Have a good look at the tiles on the roof- are they all there and do they look like they’re in good condition? If they need replacing, it can be an expensive.
  • Parking space– note any parking facilities or restrictions
  • Neighbours– take note of the neighbours – do they have overlooking views? Do they have pets, or caravans that may end up being a nuisance?
  • Windows– what conditions are the windows in? Are they double glazed? Is there any sign of rot?
  • Garden– have a good look at the front and rear garden. Take note of how much maintenance will be required and if there is ample amount of space for your lifestyle. Ask what will be staying and going e.g. shrubs, plants, and statues.
  • Trees– take note of any big trees that are growing close to the property. There can often be problems with the roots penetrating the property
  • Garage– ask to see inside and outside the garage if they have one.

Inside the property

  • Condition of fixtures and fittings– Look for cracks, uneven floors or doorways and any signs of water damage.
  • Empty rooms– try to imagine each room being empty. Will your furniture fit? Will there be enough space?
  • Smell– try to smell any for dampness or any other suspicious smell. If the property is overbearing with air-freshener, they maybe trying to hide something
  • Windows– make sure all the windows close and lock properly- replacing them can be expensive. Look at the windows for any sign of rotting; and don’t be afraid to open the curtains to get a better look.
  • What comes with the property– find out what exactly comes with the property. Built-in appliances should come with the property e.g. cooker
  • Condition of walls– look for any cracks or any uneven surfaces.
  • Plumbing & Electricity

    • Central heating– Does the property have central heating? If so, check when it was installed and last serviced. How old is the heating system? Will it need replacing?
    • Working order– make sure everything is in working order, and especially if everything is safe. Check plug sockets and all plumbing e.g. taps, showers, toilets…etc.
    • Certificates / Guarantees– Check the plumbing and wiring. Has it been re-plumbed or rewired? If so, ask to see any certifications or guarantees.

    Location

    • Transport– what is the local transport like? Are there buses running frequently? How far is the property from the train station? Transport can be a necessity for tenants.
    • Amenities– what are the local amenities?
    • Shopping– how far is the local town? How far is the grocery shop?
    • Schools– what are the local schools like? A good school catchment area may effect property value.
    • Position of property– Which way is the property positioned? East facing rooms will receive more sun in the morning; West-facing rooms will be brighter in the afternoon. Does the property get good sunlight?
    • Crime rates– what is the crime rate like in the local area?
    • Compare with other properties– what are the other properties like in the surrounding area? Do they look similar, or in better condition?
    • Flood and planning risks– find out what the risks are regarding flooding, planning and general environment issues. Homecheck is a useful website to that information from. It also shows crime rates.

    Questions to ask vendor

    • Cost of living– ask about cost of living in the property, expenses like utility bills and council tax. In most cases, the tenant will be responsible for these fees, but it’s still quite important that the rates are reasonable so they don’t scare away any prospect tenants in the future. If the property is a leasehold, enquiry about how much ground rent/service charges they have to pay.
    • Extensions / alterations– Find out if the owner has made any improvements. If so, do they have the relevant warranties?
    • Maintenance– does the property require much regular maintenance?
    • Neighbours– ask about the neighbours. How long they been there, have there been any disputes, what is their relationship like? Bad neighbours can make a dream home into a house from hell.
    • Reason for selling– find out why the vendor is selling. Knowing why the owner is selling is a significant factor in helping to decide what kind of offer you may be prepared to make. It may also give you a good indication regarding the seriousness of intent to sell.
    • Market duration– how long has the property been on the market? If it’s been on for a substantial amount of time, ask yourself why. In general, good value doesn’t stay on the market for a long time.
    • Previous/current offers– has the property had any offers? If so, find out what the outcome was.

    The results of my viewings

    I’m going to refrain from going into depth about the properties I viewed because, firstly, it would take me all bloody day, and secondly, it ain’t all that interesting.

    But basically, I viewed four 2-bedroom terraced houses, all within my budget of £165k. They all fitted the criteria I was after, but…! There was always a “but“, something just wasn’t right about each property.

    I’ve always said to myself that I’m not going to buy a property that I’m not completely happy with.

    Yes, I know, I know!

    I’m already violating one of deadly sins of property investment and Buy-to-let by not trusting and focusing on the numbers, but rather focusing on the property itself. However, in my puny little head, I’m thinking, “I wouldn’t part with my hard earned cash to stay in there, so why would anyone else?”

    Rightly or wrongly so, I’m adamant on buying a property that I would appreciate both as a home and an investment. Know what I mean? Perhaps when I have 20 properties under my name I’ll be more cutthroat.

    My Estate Agent, Stuart, said he will look through his books again and book some more properties that fit the criteria to view in a few days time.

    It’s just a waiting game now (I anticipate a lot of that)

1 Join the Conversation...

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Sarah@Willowbrook 20th August, 2013 @ 10:52

A few other points I would add;
Is there an option to extend the property later if you want to add a utility room, extra bedroom or downstairs bathroom?

2./ What is the area classed as when it comes to buying house insurance? ie is the property classed as being in an area likely or prone to flooding? Not always obvious, but my home is classed as low-risk area despite being on a hill at least 400 yrds from a small brook!

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