Sydney House Inspection
If you are going to buy a do-er upper like the one above you need to know your numbers upfront and entirely what you’re in for before you part with your coin.
(Before we get to that i need to remind you to book a Sydney House Inspection before you purchase. The condition might be much worse than it looks.)
Here’s a basic analysis of what you’ll need to know, or at least an estimate:
- The purchase cost up front.
- How much it will cost to get it to the level you want it, either to live in or to on sell.
- How much it will be worth when its finished.
Lets look at each one in a little more detail.
1.You need to do your research first and come up with a figure that you’re willing to pay, a top dollar as it were. This is a bit tricky with a do-er upper as there aren’t many comparable sales to compare with. And don’t listen the the real estate agent, you need to come up with what YOU think its worth.
- You could go by land value only.
- You could find recent comparable sales. If you can.
- Or you could find similar properties in good condition and deduct your building costs.
- These are just a few ways to come up with a purchase price range. Do your research up front ok.
- Don’t forget to include any costs that are in the Sydney House Inspection report. Could be structural issues or termties etc.
2. If you’re in the building industry you’ll have a rough idea already, otherwise get quotes on material and labor to come up with a finished figure. A pretty good estimate is ok.
3. You again need to do your research and with a bit of smoke and mirrors here.
- Why smoke and mirrors? Say the building takes 2 years, you really don’t know where the property market will be in 2 years time. It could grow or more unlikely it could tank.
- I think the best strategy would be to come to a figure of what it would be worth today – finished – and then apply an upper and lower variable to that to project to your estimated finish time. EG: $700k +/- 15%. Something like that.
So there you have it. Buying a do-er upper is fine if you know what you’re in for up front. Do your research. And don’t forget to book a Sydney House Inspection up front. You need to know about structural issues as well as if there are termites. Good Luck!
Oh…and by the way, i lived next door to that house in Newtown 2042 years ago. It was in much better condition then.