Many people when looking to invest in an HMO are happy to pick up a property listed as being under market value because it needs work done to it. This is a great way of making yourself a long-term profit because, of course, there are plenty of builders out there only too happy to take on a commission and your property will be worth far more once complete.
Trouble is you have to be sure you’ve hired the right builder in the first place – otherwise you could find yourself severely out of pocket. That’s because (a) he may do a botched job and you need to hire another builder to repair the mess or (b) the company may overcharge by introducing ‘added extras’ as the project proceeds. Choosing the wrong builder could also be dangerous of course – collapsing bricks and mortar can cause a lot of serious injury.
But it’s not only your pocket or limbs that hiring the wrong builder can hit. Just think of the mental stress too when you realize things aren’t working out the way you expected them too. It’s crucial therefore to spend plenty of time researching local builders. But what do you need to look for?
Sticking with the number three – ask for a similar amount of references from each builder. And do follow them up ie go round and look at the work they did and speak to the home owners (if possible – most people should be willing to chat, especially if they feel the builder did a good job for them).
What to do once you’ve chosen a builder
Once you’ve accepted a quote, it’s important to draw up a written agreement (ie contract) which outlines the work you want done in as much detail as possible, timescales for completing it and the exact cost (unforeseen extra costs may arise so it’s an idea to write in a paragraph about approval from yourself and whether you’ll pay for these at the time or at the end of the job).
It’s customary to include a penalty clause if the work runs over and on bigger projects customers often keep a retainer fee. The latter is paid a few months later once any necessary repair jobs are completed.
If you want your builder to tidy up after himself then include this in the contract too. Finally, make sure you meet with your builder on a regular basis while he’s working on your property to check progress and iron out any matters arising.
You can download a contract from the likes of the Federation of Master Builders or buy one from the Royal Institute of Chartered Surveyors. Good luck!
I'm Jacquie the Property Go-To Girl. I am passionate about property. I love to help people make the most out of their property investments!