Properties with problems are your worst nightmare as an investor. You’ll keep pummelling cash into them in hopes of getting them rent-ready, only to find more and more issues keep cropping up.
Here’s what you need to know about avoiding accidentally buying a property ‘lemon’.
What You Should Look Out for in Your New Investment Property
The best way to gain peace of mind before an investment purchase is to have qualified specialists conduct building and pest inspections. There are, however, some quick tricks you can use to check for any immediate issues:
1) Building structure
If your property has shifted in its foundations, this can cause serious problems. Check the walls for any cracks in the plaster – the bigger the cracks, the worse the problem is likely to be, especially if they’re found on exterior walls.
2) Wiring and electrics
Risk of fire is a big threat if there are electrical issues within the property. This is more of a problem in older properties, but they can occur in newer ones too if the owner has done some dodgy DIY. One key sign of bad wiring is blackened areas around power outlets.
3) Pipes and plumbing
Plumbing issues can be an expensive problem to have if not identified early on. The majority of new homes are built using plastic piping, but older properties may still have galvanized or cast iron.
You can test whether the pipes are rusty pretty easily. Simply turn on the water and check the pressure.
If left unattended, pests such as termites can absolutely decimate floors and walls. Eventually, this can lead to structural issues.
Look on the floor for small bits of wood residue, as this is a key sign of a termite infestation. These are typically found around door frames and windows, but bubbled paint can also be a symptom of termites.
5) Illegal work
Poor quality renovations that have been carried out without the correct council approval can cause you big problems.
During your inspection, survey the rooms for any recent modifications and ask to see the related permits for the building work. If the vendor can’t help you with this, your local council will. Although it might seem like you’re grabbing a bargain, buying well is the key to smooth returns.
6) Water damage
Mould and damp floors are two issues you don’t want to deal with. If the property has water damage, however, these are two problems you can expect to see on your renovations and repairs list within the first year.
Check the Property Thoroughly Before Making an Offer
These tips will provide you with a thorough basis for understanding what’s going on behind the walls and foundations of your target investment property.
If you notice any of the above issues, it’s advised that you hire a professional surveyor to review the building before making an offer. Although it will present an upfront cost, you’ll save a significant sum of cash in the long-run.