Issues Of Devaluing Property

Your property is not just your home; it’s your investment, possibly even your pension. Understandably therefore, when selling your property, you want to make sure that you get the best price possible. Many home-owners make improvements in the hope that it increases the value of the property but, depending on what is done (and how), it could have the opposite effect.

Here are a few common aspects that have a depreciative effect on the value of your property.

 

Nuisance Neighbours

According to a survey conducted as part of Halifax Home Insurance's Peace of Mind campaign, one in five (17%) homeowners encountered serious problems with their neighbours during 2009 - the highest number experienced since 1997. The most common complaints were excessive noise (49%), rude or intimidating behaviour (23%), and the 'hijacking' of legal boundaries (20%).

Halifax reckon that anti-social neighbours can knock up to £31,000 off the price of an average property. When selling your property you are legally required to disclose anti-social neighbours within the Home Information Pack (HIP). Of course this view is based on subjective perceptions, which differ from person to person and is thus difficult for a buyer to pursue legal proceedings.

As a buyer (or tenant) you should gather as much information as possible about the neighbours before you sign on the dotted line. If you do find yourself living next door to neighbours from hell and polite requests to refrain get you nowhere, you should complain formally to your local authority. The website “Neighbours from Hell in Britain” offer advice and assistance in dealing with ASB (Anti-Social Behaviour).

Conversely, an added selling point for your property is if your neighbours are especially vigilant or if there is an active neighbourhood watch.

Home Improvements

Before undertaking any improvements in your home you should check on the Planning Portal to establish what the building regulations are or whether you need planning permission. The website offers unique, interactive models which detail a multitude of improvement choices and their requirements.

Failure to comply will result in costly renovations to either rectify or remove the unlawful handiwork. This is either carried out by the seller or factored into the sale price for the buyer to sort out.

The cost of home improvements should be in proportion to the value of the property so that you can avoid over-capitalising (increasing the value of your property to more than area dictates).  To give you an idea on where your should spend on improvements;

• An extension can increase the value between 10 and 50%
• Upgrading the exterior improves it by up to 15%
• A glass conservatory by around 5%
• An en-suite bathroom hardly adds value at all.

Exterior

If your house does not compare favourably with the other houses in the street, it obviously won’t fetch a good price. Furthermore, signs of neglect on the outside will cause potential buyers to be suspicious of the interior.

The garden must be neat with all dead leaves removed. Trim the hedges, mow the lawn and remove all weeds and moss. Repaint the gate, fence and front door in neutral shades. Clean the windows and window frames.

This is one of the least expensive ways of maintaining (if not improving) the value of your property!

Flood Risk

Flooding from rivers, estuaries and the sea pose a serious threat to millions of people during this period of extreme climate variability. There are many websites available that can provide you with flooding history and potential flood threats, all from the input of a postal code.  The Environment Agency is a comprehensive portal hosted by the governement.

 It stands to reason therefore that if your property is at a high risk, the price will be reduced dramatically to compensate for the potential flood damage averaged at between £20,000 and £40,000. Not to mention any additional insurance needed.

Doggone it

There are 27 million pets in the UK with 43% of households owning at least one furry/scaly/ feathery friend.

Most of us adore pets but there is no doubt that, to a none pet-lover’s nose, the animal’s smell is very detectable (not delectable). Potential buyers become wary and fear that there will be underlying damage caused by the pet or that the smell will never be completely eradicated. Knock off at least 5% from the value of the property.

  

 Schools

Since government schools only take on children from their local catchment area it is a high priority to families with children to actively seek property in areas where the schools have good Ofsted reports. Buyers will pay an average of around 8% more for properties located near a “good” school.

 Similarly, lower Ofsted schools results could devalue your property by a similar percentage.

Crime Statistics

Neighbourhood crime costs home-owners more than the loss of material goods – it significantly decreases the property prices and increases insurance rates. Statistically, the incidence of criminal damage is higher near public houses and other places of alcohol consumption so you should anticipate buyers’ concerns by making the property more secure.

“Up My Street” provides a mixture of information about the local area and it includes a comparative study of the crime rate in your area versus the rest of the country. Be sure that any prospective buyer will do their homework and will expect a high crime rate to be factored into the price.

 

History

It isn’t a legal requirement to disclose superstitions or deaths in the property but if the knowledge is part of the local history, it is better to be upfront about it and allow them to decide if they wish to live with the stigma. On the other hand, some eccentric buyers will pay a lot for a property with a sinister history but these are few and far between…

Outdated, Tacky or Sloppy Trimmings

Tackiness or bad workmanship can subtract 5 to 10% off the value of your property, even when the rest of the property is perfect. Be careful of alterations or décor that date the property, (unless it is a listed building) for example timber panelling, Artex ceilings and antiquated lampshades. 

New Developments

You may have been surprised by recent changes in your immediate area which has negatively impacted the value of your property e.g. road access, new shopping centre or the removal of something which has previously improved its selling price. While there may not be anything you can do about it now, it does teach us to dig a little deeper in our research of the local area.