by Stella Kaye

Created on: November 29, 2008

VITAL FACTS TO CONSIDER WHEN PURCHASING INVESTMENT PROPERTY

Before purchasing an investment property the two vital questions you should ask yourself are: how much am I prepared to spend? And: how long am I prepared to wait to see a return on my investment? Nowadays it is becoming increasingly difficult to find a suitable project and even more difficult to manage a fast turnaround on renovations. It is often the case that you will need to hold on to a property and rent it out for several years until you can make any significant financial gain.

First of all you need to budget and stick to that budget rigidly unless some unforeseen expense occurs such as necessary repairs to protect the fabric of the building. The whole process is similar to managing your own household budget but on a grander scale. Flexibility needs to be maintained if an idea is clearly not going to work or proves too expensive and if it cannot be adapted to fit your initial specifications and requirements.

It's no use installing a brand new kitchen if there is damp to the ground floor walls. This may seem blatantly obvious but it's surprising how many amateurs think if you can't see it, then it doesn't matter. Having a survey is advisable but it's wise to bear in mind that surveyors are not obliged to move furniture, lift carpets or crawl into loft spaces... but this is where some of the most serious defects in a property can be found. Roof and floor joists may be rotten and carpets and floor coverings can hide a multitude of sins from wood worm infestation to dry rot and worse. It is wise to assume that the older the building, the more severe the problem will be. Most of the terraced housing stock in the UK is at least a century old and the wooden parts of the structure may have been exposed to damp conditions for long enough for the supporting beams to be well rotted. Home owners are sometimes blissfully unaware of the horrors that lie beneath floorboards and in loft voids until these beams actually collapse.

Another problem to consider which can literally bring the house down is removal of chimney breasts. Previous owners in their greed for extra living space may have removed them without a thought for the now unsupported chimney. I call this "Floating Chimney Syndrome." When viewing a property, go out into the road, look at the roof and see where the chimneys are located. Then go back inside and see if the appropriate chimney breasts are still in situ underneath. It's amazing how many unsupported

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