In a development, time spent on preparation is always time well spent. An experienced developer will always work closely with a team of professional advisers - including planning experts, architects, surveyors and structural engineers. The point is to remove as much uncertainty as possible from the project before building work starts.
Preparation is the only real way to gauge the likely costs of improving a property: a detailed survey will give a good indication of the necessary work, and the likely costs.
When it comes to planning, the experts agree that it is always cheaper to make changes to a design on paper than once building work has started. In fact, starting work without the proper planning consents is against the law, and developers can be forced to demolish work that fails to comply, at their own expense.
Despite this, a few as one in five homebuyers undertake a survey of any kind. But the cost is a relatively small investment, when set against the cost of buying a property.
Fees for a full structural survey vary around the UK, but the cost is generally between £300 and £750. A survey can easily save more than that, by pointing out problems in a property that a developer might not spot themselves.
'A surveyor has seen hundreds of properties and will give a much better overview of what you can do with a property than a developer or buyer who has only bought a few,' says William Tew, head of property policy at the Royal Institution of Chartered Surveyors.
A survey for a small residential development, such as a refurbishment, will not differ much from a survey carried out for an owner-occupier. The report will cover the condition of the property, point out defects and explain which defects need urgent repairs. He or she will also suggest areas that need further investigation by specialists and point out planning or building control issues, so that the buyer's solicitor can check the paperwork.
If problems are serious, the surveyor might even recommend pulling out of the deal. For a developer, though, the decision is likely to be financial. Is it possible to fix the problems, and still make a profit? What are the risks involved? Some building work, such replacing a roof, is relatively easy to cost in advance. Issues such as subsidence or damp can be harder to fix, making costs harder to predict.
The surveyor can provide estimates of the cost of any work, based on their view of the condition of the property and their local market knowledge. This can go beyond just the cost of fixing problems with the building. Ask the surveyor, in advance, for guidance on the cost of an extension or adding a bathroom, and they will put an estimate in their report. The developer can use this as a basis for their business plan, as well as to negotiate with builders. 'The surveyor will give you an independent assessment of how much it will cost to get the fabric of the building into the condition you want it,' says William Tew.
The surveyor can also give a guide on how much the property will be worth when it is finished, and advice on refurbishing it for the rentals market. The surveyor will also explain whether problems with a building could scupper a deal, or mostly cosmetic. Either way, the developer can use the survey report in their negotiations with the seller.
