Your clients come to you for professional advice when it comes to financing their property investment, but where do they turn to understand an accurate current and achievable value for that investment?
After all, arguably the biggest barrier to the success of any property investment is not selecting the wrong finance, but selecting the wrong property, and unrealistic expectations about the rental or capital value a property might be able to achieve can be the difference between a happy client and a disgruntled investor.
With this in mind, establishing a working relationship with a chartered surveyor can help you to help your clients make the right decisions. Here are just a couple of areas where a chartered surveyor could help:
For first-time investors in property refurbishment or even experienced property developers who want to reduce speculation to mitigate their risk, there can be many benefits in involving a surveyor early on in the process.
A surveyor will be able to not only establish an accurate value for the property in its existing condition, but also provide unbiased information on the expected capital or rental value once the renovations have been completed, and this can help your clients to consider their favoured exit, which could influence their finance options.
Establishing an accurate valuation for an HMO (Houses in multiple occupation) is trickier than a standard property as there are more things to consider and fewer comparables. A key element of the valuation is the achievable rental income and yield of the HMO and so a surveyor will consider the location and potential to sustain regular letting of individual rooms. This means thinking about whether the property is near a transport hub, university or hospital and the realistic rental price for each of the rooms.
A surveyor can also check against the local authority Article 4 direction to ensure that the HMO does not contravene any local planning regulations and that the property can be let on a room by room basis.
In addition to considering regulation, local authority requirements and the RICS Red Book guidelines, a surveyor may also be able to consult on the specific criteria of different lenders who will have their own guidance notes to take into account, regarding the valuation of an HMO property.
Establishing a working relationship with a surveyor can therefore help to increase your conversions and potentially also grow your business.
If your clients are able to make more informed investments that help them to become more successful, they will also be more likely to investigate new opportunities, which means further funding and more business for you.