Hints on Choosing a Property to Purchase

1. Personal requirements

Each person will have a list of things they are looking for in a property and some points will be more important for some than for others.   Some obvious points to consider are:

  • Price
  • Location
  • Convenience and size of accommodation
  • Parking
  • Condition of the property
  • If buying to let, are  there plenty of good tenants for that kind of property in that area?

2. Will there be difficulties related to the Sellers?

Sometimes you will have to weigh factors about the property itself with questions about possible delays and changes of mind.    If possible, try to get to talk to the sellers themselves at some point, rather than doing everything through the estate agents.   Issues to consider and ask about are:

  • Why are the sellers moving?  Is it a clear reason like a job move or a bigger house for growing family?  If so they will perhaps be more motivated to see things happen.
  • If they are buying something else, are they being realistic about what they are looking for?
  • If there is more than one person involved, are they both agreeing in what they say to you?   If not then they may never agree about what they want to buy, or may change their minds about selling at all later on down the track!
  • Following the last point, if there is a divorce or a separation involved, have all the financial arrangements REALLY been agreed and finalised?
  • If they have found a property to buy, how long is the chain above them?
  • Are they, or someone in the chain above, buying a new property that is still being built?   There could be a long wait for completion until it is finished.
  • If you need to complete by a certain date and that might mean the sellers will have to move out into rented accommodation or with family, remember that until Exchange of Contracts there is no binding commitment, so you can only go on your assessment of how personally morally committed they are. DO NOT accept what the estate agents say about this. How do you know the sellers weren't caught at an unguarded moment and when asked, said that maybe, perhaps, if it really came to it, they might be able to go and stay with family...? Make sure you talk to the sellers themselves and get them to think through what is involved in e.g. moving out to rented or family without proceeding on a purchase, so they don't say later that they didn't realise how difficult it would be....

3. Is it a Good Investment?

Some property can appear attractive because of its relatively low price, or has a higher price but is in a much better location.   There can be some downsides like:

  • Generally, lenders that are prepared to be more liberal in lending e.g. to those with credit problems or self employed without accounts, are fussier about the kind of property they will lend on.
  • Newly built property doesn't always hold its higher value as compared to similar slightly older property in the same area.
  • Mortgages may be more difficult to obtain on flats over shops or in high rise Council blocks, or for non traditionally built property.
  • Generally, unusual property is easier to sell in times of house price rises, and more difficult in times of slump.    A property with some disadvantage such as non-traditional construction, or a flat with problems about the leasehold arrangements, may be valued just below otherwise similar property in times of boom, but in times of slump may be much more difficult to sell and will be worth proportionately much less.   Something which has lots of advantages e.g. in location, may command  a much higher price in boom times but in a slump may not retain the same proportionate advantage.   For instance, flats in Marina Developments may be second homes that will not be wanted if their owners have to make economies.
  • Properties with legal conditions can be more difficult to sell or to obtain mortgage finance using them as security, e.g. relating to occupancy only by local people or those employed in agriculture, or only to use for holiday letting.

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