If you have purchased a rather run down commercial property and are looking to turn it into a potential residential letting concern, you may accept that you have substantial work to do – but you’ll typically want to keep your costs down.
In passing, remember that if you have purchased that type of property and are renovating it to be residential, in the interim you may need commercial unoccupied property insurance from someone specializing in such cover like Cover4LetProperty.
Here are a few tips that might help you get your property looking good whilst at the same time keeping one eye on your purse strings:
Remove all signs about the property being a commercial one.
As part of your initial pre-purchase due diligence checking, you should already have confirmed that change of use permission is not likely to be a problem. However, make sure that your renovations remove all signs that the property was previously a commercial one – unless you’re planning to make it a feature (e.g. Victorian warehouse conversions). People typically don’t like living in something that was obviously once a shop or office;
Opt for neutral colors in overall décor.
Often basic colors are cheaper than more extravagant and vibrant ones and you are less likely to put people off by demonstrating your own choice of individual color schemes etc;
Think carefully about a garden.
Some surveys have indicated that a high percentage of tenants consider that to be an important factor when choosing a property, particularly so if they’re female or include females*. Be prepared to invest a little money in making this happen if the property currently has only concrete to the front and rear;
Make sure the outside looks attractive.
Many potential tenants will simply walk on by if they see dirty or discoloured window frames, drainpipes and untidy front garden areas. Overall the costs of doing so are unlikely to be high and may consist largely of a little bit of sanding plus the liberal use of some fresh paint;
Purchase any furniture and decorative items you plan to use from public auctions.
Go to general rather than specialist fine art sales, as the prices at the former are typically much cheaper than you will pay for even flat pack new items. You may also find that they are more robust and better appreciated by tenants on viewings;
Buy consumable and renovation items individually from multiple stores.
Buy most of your consumable and renovation items (e.g. insulation) from one-stop DIY outlets under the banner of bulk purchase cards. You might typically save yourself a substantial amount of cash over buying things individually from multiple stores;
Register for trade discounts, if possible.
Along the same lines, you might consider registering yourself for a trade discount in situations where you have a number of properties that you are renovating at one time;
Make use of the government’s energy savings allowance where possible.
Using the government’s energy savings allowance as much as possible might save you up to £1,500 per letting unit, through a tax allowance on your purchase of things such as insulation materials and related energy-saving items;
Shop around for major capital items.
That might typically include things such as new windows, new boilers or entire central heating solutions. You may be surprised to know that even when discounts are taken into account, it is sometimes more cost-effective to purchase these things on the internet from direct suppliers rather than from major DIY warehouses;
Do as much of the restoration work yourself as possible – within reason!
Labour costs are inevitably high and if things overrun you may find yourself in some difficult squabbles with your contractors. It may be cheaper or more efficient to do as much of the work you can yourself though make sure you don’t exceed your own knowledge and capabilities. Be sure also that you are fully aware of things such as building, planning and safety regulations;
Select properties that are close to where you live.
While you are renovating a property, you will be spending a lot of time travelling there potentially every day. That is going to be expensive in terms of travel costs and your time if the property happens to be a long way away;
Familiarize yourself with the basics of project management.
Renovation projects frequently go badly wrong and consume huge amounts of unnecessary money, simply because things were purchased or work undertaken in the wrong sequence. Should those things happen, they’ll mean at best spending money before it is necessary, as the items can’t be used or at worst, serious delays, re-work and wasted spend.
Landlords are typically in the business of letting property and managing the associated issues, rather than building and decorating. Often times, they may outsource some or all of these tasks to a property management company similar to Continental Realty that specializes in the role. Property managers usually collect a fee each month from the landlord for providing the service of management and upkeep.
It Seems Easy…
Even so, try not to get frustrated and believe that you can speed things up simply by throwing money at the renovation. It typically doesn’t work and is no substitute for realistic planning and an economy-minded approach.
*Source:
*Independent study carried out March 2013 on behalf of Cover4LetProperty.
