Improve the property, improve the valuation

THE QUESTION

There’s a house I have seen, it’s a three-bed house on a street that consists of just three-bed houses all around the £92k mark

Except there is one house on the street that’s had a really good loft conversion that’s added 2 bedrooms and another bathroom and it sold a few months ago for £165k

If I buy a house on this street and do a conversion to the same standard as the £165k one, am I likely to get the new valuation at £165k, with it being the only comparable property on the street?

THE ANSWER

There is a simple solution (and it one that is part of the content of my Ninja Investor Programme workshop).  It’s important to get clarity on the end value before you commit to the purchase, rather than wing it and hope you get the right value and end up disappointed when you don't, as so often happens. 

My advice is to engage your own RICS valuer, give them a projected works schedule and get them to produce a full RICS report giving you the end value.

For probably less than £300, you have greatly de-risked your project.

If you then choose to commit to the purchase and do the work, you will still need to build a robust case for the uplift in value to present to the mortgage lender’s valuer when you come to refinance it (I teach a whole module on how to do that), and your own RICS report will form part of your case.

• Contact Kevin Wright over on his Facebook page.
• Browse the Recycle Your Cash online training library by clicking here.
• Attend an upcoming 1-Day Property Finance Masterclass event - Book in here.