Even the most derelict of houses can be a great opportunity, but not all houses in need of renovation will be profitable
Repossessed houses usually only appear at auction and they tend to sell for less than the market value, which means you could make a profit before you’ve even touched the place. The price that properties reach at auction can highlight hot spots and the prospect of price rises in different areas.
Good catchment areas
A property that’s within the catchment area of a good state school can be worth more than an identical house just across the street that isn’t. There’s more potential to add value to smaller houses in these areas if they can be made suitable for young families. You can locate good schools by visiting www.des.gov.uk/performancetables.
A cluster of sold boards on display is a sure sign that an area is up and coming. Speak to the agents to find out what the asking price was and what they went for to give you an indication of the potential profit you could make. If they are reluctant to tell you, the details will be on HM Land Registry once the new owner’s details have been registered.
It’s wise to build a relationship with an estate agent because you will get the best information on the latest properties on the market. It’s also worth contacting local valuation surveyors who will be able to provide a useful insight into property prices in the area.
Keeping an eye on the property papers is the easiest way to keep track of active areas. Compare them each week to see which ones are selling quickest or increasing in value.
A street with two or more skips is a good indication that an area is on the up –people only spend money on houses if it’s justified by rising values.
They invest a lot of time and money researching where they should be building new homes, so if there is a new development it means demand is high and house prices will probably rise.
Research the local authority’s regeneration plans. Often whole areas are bought on *compulsory purchase orders to be cleared and replaced with new houses, shops and healthcare centres. The streets surrounding these areas will usually benefit from the improvement, resulting in rises in house prices.
Look out for any new business coming to the area. New jobs means more people coming to the area – increasing the demand for housing, which in turn drives up house prices.
*Compulsory purchase orders
In England, local authorities and government agencies have the power to buy land that isn’t for sale by the owner to help regenerate certain areas.
To find properties with potential visit PlotSearch.