When considering buying a property, people will often be told to look for the worst house on the best street. This is a truism of sorts from the idea that we should all think like Tim Manning property developers, thinking ahead of the potential of the house rather than it’s current state. The worst house on the best street is likely to be the cheapest, with room for the most growth, right?
On the other hand this phrase goes against the grain of what we’re trained to look for when house hunting. Who wants to live in a house that’s less than beautiful? Especially if it’s your first home purchase and you’re looking to start a family. When somebody thinks of their dream home they’re not thinking about living in the ugliest house on a street.
There is some hard truth behind this phrase, it stems from the real estate industry’s perspective of looking to improve your situation and buying for potential. If you’re DIY savvy or have the funding to hire professionals a purchase of a run-down home can allow exponential growth and the priceless opportunity to put your own mark on a home.
Through this process you can bring your home up to standards with the rest of the street, matching their price for hopefully a lower cost than it would have been to purchase. This approach allows you to improve the value of your home by a considerable amount, improving your chance of making a large amount of money upon resale. The idea here is that the buyers will not only be purchasing the house but also the neighborhood they are attempting to move into.
From the get-go there are many benefits to buying the worst property. It’s popular belief that many home seekers will ignore the property and attend auctions or compete for purchase. This gives you a better chance of being able to attain the home, and hopefully bargain for a lower price. A less than pretty property is also a fantastic opportunity to affordably move into a good neighborhood. Sometimes the only thing stopping us from living where we desire is the price tag that comes with this.
Of course there’s always a risk when buying into real estate. The industry is always changing and there’s never any certainty that an area will remain valuable for any length of time – let alone the time it takes for you to renovate and sell. This theory works on the assumption that you’re prepared to fix up a property and develop it. If you don’t fit these criteria then it wouldn’t be a good idea to move into the worst house.
Some properties can simply never be bettered. If for example there are factors such as railways or permanent fixtures nearby or on the property then you will never be able to outweigh the negative impact of these. The worst house is only as good as it’s potential to become the best house.
So before jumping into the phrase with two feet you need to be sure that certain issues can be overcome, that you understand how extensive the process will be and you are equipped to handle the challenges. However, just because a home doesn’t look as good as it could, doesn’t mean it’s not worthwhile. Homes are more than their appearance. Functionality and location are the biggest sellers in real estate and your decision should reflect this. It’s easy to make a property appealing when all other factors are working in your favor.