June 11th 2018

Buying to renovate: a good investment?

The good location/price ratio of some old buildings, right in the centre of a town, with better services and better public transport, has led many buyers to consider buying cheaper old housing with renovation possibilities.

Good negotiating conditions and tax advantages

Older properties offer the buyer a good scenario for negotiation. They are usually properties with few financial costs, which allows the seller more independence, and they usually need some renovation, a factor that is to the buyer’s advantage in obtaining a reduction in price. In addition, the buyer will be able to take advantage of all the benefits of buying a second-hand home, as well as those foreseen for the subsequent renovation.

It is advisable for the negotiation to cover the estimated amount of the subsequent renovation, with some upward margin, given the uncertainty that always exists in this type of work. 

A unique home 

If you have the right spatial vision, the results of these types of operations can be spectacular, due to their uniqueness and adaptation to everyone's needs. However, it should not be forgotten that this is a high-risk business operation, which requires a minimum of knowledge by the buyer and where the condition of the building is decisive.

It is essential to have the approval of the Technical Building Inspection (ITE), and it is also necessary to check that the facilities have been adapted to the mandatory rules and that there are no outstanding debts with the association of property owners, supply companies, municipal and regional tax authorities or any disciplinary proceedings in the area of town planning. 

It is not advisable to undertake the purchase of an old house if you do not have the advice of a renovation professional who is able to identify defects and evaluate costs, factors that can be decisive when negotiating the purchase price. If this process is carried out rigorously and seriously, the buyer will end up with a unique home, adapted to their needs and tastes, well located and at a better price than a new home.