Finding diamonds among the distressed

But such properties are not always well-presented – indeed they are often somewhat shabby-looking - and it can take a really keen eye to spot their potential, says Hano Jacobs, CEO of the Realty 1 International Property Group.

“Owners who were having difficulty in making their home loan repayments will obviously not have had much, if anything, to spend on the upkeep of their properties, and it is true that in repossessed properties, grime and clutter can hide a long-term absence of essential maintenance that may cost the buyer a lot to rectify.

“However, distressed properties are different. They are usually sold before the owners have got themselves too far into financial trouble, and most are certainly worth a second look to see if the “bones” of the home are sound.”

What buyers who are interested in distressed properties should especially be looking for, he says, are the following indicators of a “good buy”:

* Good basic structure. Avoid properties with bad cracks, serious roof leaks and rising damp. And if you find a home you like, get it professionally inspected before you make an offer.

* Good infrastructure. Ask your home inspector to also check the electrical system, plumbing and any gas installations and make sure the seller can produce up-to-date safety compliance certificates for these. In some areas, you will also need a borer-beetle certificate.

* Well-proportioned rooms and a good floor plan. Forget any furniture, curtains, carpets and paint colours that are not to your taste and use your tape-measure to get the real dimensions of the rooms.

“If all these three elements are in place and the home is in a good location, the astute buyer will be quick to react, especially if the price is well below current market value for the area, as is the case with many distressed sales,” says Jacobs.

“Indeed, the savings to be made when buying such a property will usually more than compensate for the cleaning, mending and repainting that are probably all that will be needed to turn it back into a real gem.”

  Comment on this Article

  Please login to post comments

Post to my facebook wall
Characters remaining

    Latest Property News
    • 23 Feb 2018
      RE/MAX Property Associates’ Table View Office, which services property buyers and sellers along the Table Bay coastline and surrounds, has recently sold a home in Woodbridge Island for R11 million – the highest price paid for any home in the sought-after security complex.
    • 23 Feb 2018
      Choosing to invest in an overseas property can be daunting. But as more and more investors recognise the value of a diversified portfolio that includes property outside of their own country of residence, international property investment is growing in popularity.
    • 23 Feb 2018
      The positive change in South Africa’s political landscape is paving the way for an upswing in the local property market.
    • 22 Feb 2018
      An excellent credit score is one of the most priceless assets a potential home buyer can have. This tool has the power to secure favorable mortgage and refinancing rate, influencing everything from the size of the loan repayment to the interest rate on the home loan.
    • 22 Feb 2018
      What do you do if you love your home’s location and the area, but the home no longer fits your growing family’s needs? Do you stay and renovate your existing home or find a home that meets your developing criteria?
    • 22 Feb 2018
      While every owner wants to sell their property at the best possible price, overpricing a home can be the kiss of death for a sale.
    • 21 Feb 2018
      Given the hand they were dealt, government has performed a delicate balancing act which it is hoped will serve to reignite confidence in investment in South Africa, regain our global credibility and satisfy the credit ratings agencies, says Dr Andrew Golding, chief executive of the Pam Golding Property group.
    • 21 Feb 2018
      The real estate mantra, ‘location, location, location’ remains a strong market influence regardless of the prevailing economy, with suburbs like Rondebosch enjoying the buffering benefit of being ideally situated.
    Subscribe to the MyProperty Newsletter

    Last Name  
    Email Address  
    Email Frequency
    Share this Page

    For Sale Property
    Rental Property
    More Options
    Connect with us