(Bloomberg Opinion) -- Lockdown has made us all rethink what we want in a home. For city dwellers, the grass is looking abundantly greener out in the country. Londoners are packing up and heading not just for the suburbs but farther afield — pushing U.K. house sales to their highest level in more than a decade, according to property website Rightmove. Prices have reached record levels in rural idylls like Devon and Cornwall.
If those alluring Country Life magazine homes are calling out to you but your budget doesn't quite cover Georgian mansions, never fear: There is a lot of potential in buying a cheaper, older property and doing it up yourself.
Renovating old houses can be a new way of life, but you have to be smart — and brave. We moved into an old home in the country even before having children and are now on our third major renovation. So here are some thoughts on how to approach a fixer-upper without buying a money pit.
Make sure you’re ready. You are not just buying a house but a lifestyle, so consider renting first to get a handle on the area and that longer commute. Having spent 25 years watching London property prices soar as country homes stagnated, I can confirm that the rural lifestyle requires steely commitment. Houses take a lot longer to sell in the country, so you have to view the investment as a long-term pension plan. But improving what a house offers is what future homebuyers will buy into.
Get a full structural survey of the house. It’s worth paying up for the very best survey you can get, as it will become your guidebook. In addition, getting a structural engineer’s report with follow-up inspections — even if it costs 2,000 pounds or more ($2,600) — will ultimately help you sleep better and cut down on future architect bills. Walk away from the property if roofs, windows, plumbing or subsidence issues look too daunting. Those tend to eat up the most cash. Having detailed room plans, with every light socket, switch and plug configured, can also save you a lot of money down the road.
Do your research. Dealing with local council planners, particularly for listed heritage properties, has generally become a lot easier than it used to be. But it still requires researching what renovations, plans and extensions will likely get approved and using local planning agents will help get those permissions. Make sure to check not just what gets signed off, but what gets rejected and why. We currently live in a conservation area, which means something like a loft extension that alters the exterior roofline is highly unlikely to be allowed, whereas adding some simple windows would be.
Budget wisely. Cash flow is king, as buying an old home requires relentless maintenance and big one-off expenses. So factor these into your overall budget for the project. Not only should you pay attention to price of the home, you should also weigh the cost of hiring a project manager versus hiring a builder and all the subcontractors yourself. We saved a lot by managing everything ourselves.
Soft furnishings are often where the expensive surprises come, so make sure to budget for the carpets, curtains and furniture you’ll need. Outside spaces are just as important as interiors, so you’ll want to budget for improving gardens and boundaries too. For example, one painful expense can be upkeep on entrance lanes. If possible, get the road surface sorted properly as it can really detract from the value and saleability of your property. One thing we learned that’s really worth spending money on? Exceptional lighting — both inside and out.
Save where you can. If you want to ruthlessly control your expenses, living onsite — even if that entails the glamour of a mobile home — while renovating is a must. Cutting out as many middlemen as possible can also save you a fortune, as can buying big-ticket items like scaffolding yourself and then reselling them later (avoid those rental fees). You can cut down on surprise bills by keeping building changes to a minimum. If you’re looking at a big project, you can also set up your own company to manage it, which can help you offset sales tax and expenses.
Approach things in the right order. Gaping holes in roofs and floors need not be deal breakers, since they can be surprisingly simple fixes. We navigated both at minimal expense by getting professional advice upfront. We even managed to fix a flooded cellar that rose and fell with the nearby pond — the answer was not to seal the 500-year old foundations of the house, but to invest in a simple electric pump.
Many old houses also have blackened beams that can make for dark, gloomy interiors. Sand-blasting these professionally at the outset will transform the overall feel of your renovation project. Insulating walls and attics can make a huge difference as well — it cut our fuel bills in half. Get all the messy stuff, like rewiring and plumbing, done first before any redecoration.
When all is said and done, you will have sympathetically restored a home with a history. Sure you’ll still enjoy the odd night in the city to see old friends and haunts. But that drive back into the countryside will confirm that all your hard work has paid off.
This column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.
Marcus Ashworth is a Bloomberg Opinion columnist covering European markets. He spent three decades in the banking industry, most recently as chief markets strategist at Haitong Securities in London.
