Landlords – Thinking of buying an older property? Be warned there could be problems

December 29, 2011

CIA Let Property Blog

 Landlords warned to look out for building or structural faults in older buildings.

 

Buy – to – let property is going to see an increased activity in 2012 – The RICS (Royal Institution Of Chartered Surveyors) have warned private landlords to watch out if they are buying older properties.

A rise in buy – to – let properties have been seen because of how interest rated, high inflation stable house prices and rising rents.

Landlords warned to look out for building or structural faults in older buildings.

In the third quarter of this year buy – to – let loans had increased by 16% which accounted fo 12% of all house purchase loans according to the council of mortgage lenders.

Landlords now seem to be going for the older properties that need quite a bit of work done due to a decreased of sellers in the market and an increase in competition for the best properties.

Landlords must find out what they are letting themselves in for before buying older properties. Common building or structural faults in old properties are dry rot, blocked drains, rising damp, fractured support beams and subsidence.

The cost of rectifying these problems can be extremely high. Tens of thousands of pounds may need to be paid out by private landlords to sort out the problems.

‘Landlords could be without a tenant for several months while repairs are being carried out and it could be even longer if subsidence is discovered,’ said David Dalby, RICS director of residential.

‘Estate Agents act for the seller and will not be able to advise purchasers on possible defects, and most of the time will be unaware of any issues with the property anyway. We are warning private landlords to know what they are buying and are advising agents to recommend surveys to all their clients,’ he explained.*

There are things out there available to landlords to help them to check for any potential problems.

  • Condition Report – Basic overview of the condition of the property
  • Homebuyer survey and valuation – Concise report showing any problems that may potentially make a difference to the value of the property
  • Building survey (From a RICS accredited surveyor) – This provides a report on the property’s condition and construction
 Condition Reports start from around £200, Homebuyer survey and valuation cost around £400 and a building survey costs from £700.

‘The cost of a survey is a small price to pay for peace of mind and will prevent landlords from being hit with unforeseen costs. Surveys can even be used to negotiate the sale price if any significant faults are discovered. Landlords who show surveys to insurers are also likely to benefit from lower buildings insurance premiums,’ explained Dalby.

‘RICS surveyors are closely regulated and are required to have professional indemnity insurance which helps to protect landlords if the surveyor fails to detect a fault which later becomes apparent,’ he added.*

 

*Quotes from propertycommunity.com

 

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