Even if your investment attributes includes a good location, great living space and perfect surroundings, a problem property can land you in financial difficulties and eat away your investment returns.
If you are an owner-occupier rather than an investor, you risk the lifestyle and even the safety of your family.
Many expensive property problems are not visible to the untrained eye, so before committing to buy a property, make sure you have received professional advice in relation to the following property attributes.
Common Property Problems That are Expensive to Fix
Electrical faults and wiring
Wiring problems tend to be more prevalent in older houses, and may include physical defects to power outlets, not having circuit interrupters installed, incorrect or unsafe wiring. The configuration of the electrical system should be adequate to meet the needs of the property.
These white ants cause serious damage to structural components of a property. A surveyconducted by Rentokil in June showed that almost three out of four Australians would immediately disregard a property with termites, and more than half of the respondents also believe termites devalue a home by at least 25 per cent.
Additionally, termite damage is not covered by home insurance.
These may include foundation movements, tipping walls, sagging roof lines, and uneven or tilting walls. Structural problems can be brought about by a number of things, such as plant roots growing under the foundation, the type of soil the house sits on, shrinkage or expansion of wall materials, as well as water leakage from broken drainpipe.
Problems with drainage systems and leaking pipes attract termites and cause structural damage. Poor external drainage leads to mould and crystalline deposits around the base of the home.
For internal drainage problems, look out for unpleasant smells, toilet blockages, water draining slowly from sinks, extensive mould on walls and in serious cases, subsidence.
A permit may be required for timber decking constructions or structures with roofed covered areas such as a garden shed or a gazebo. Failure to obtain the relevant permits not only affects your home insurance, you may also receive a demolition order or a request to pay for its approval.
A leaking roof affects the interior of a home, causing stains on the ceiling, walls or floors as well as the smell of mould. Left unrepaired, it can also penetrate wiring and become a safety hazard.
Avoid Making a Poor Investment on a Bad Property
The repairs above do not add any value or extra appeal to potential tenants or future buyers because they involve functional aspects that are already expected from the property.