Finance Risk v Playing safe

If you are planning to buy a rental home, or you're thinking about what to do with one you have just acquired, this is the place for any questions about starting out in the rentals business.

One bed Yes - Two bed No

Poll ended at Fri Apr 27, 2012 9:37 pm

yes
7
58%
No
5
42%
 
Total votes: 12

Wendy@NorthIdaho
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Post by Wendy@NorthIdaho »

I don't know how it is in England/Scotland, but here in the US, sometimes we are made to get flood insurance even when something has never flooded and probably never will!! So aside from the actual buying of insurance I would ask around in the city records or locals, has it ever flooded the house or garden? if not that may affect the rates, availability of ins, etc..

The cottage we bought almost 3 years ago was mandated to have flood insurance, we bought it and then the mortgage company said never mind (after they told us to buy it), of course we didn't get a refund on the policy.... but haven't had to buy it since and we are right on the water.

I would hate to give up a selling point like that without really researching it first.

All the best,
Wendy
New Vacation Rental called DayStar Lodge! (Sold Narrows Cottage now have a rental management company called A-List Rental Management)
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Giddy Goat
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Post by Giddy Goat »

Redfox wrote:but who in there right mind would knowingly buy a property in a flood risk zone.
We almost bought a delightful cottage in the Charente Maritime in France, with its garden at the front and facing the river.
It was in a flood zone but we loved it so much we went ahead and our offer was accepted. So yes, we weren't in our right mind.

A "bent" notaire brought the transaction to the point of impasse however, and in the end, the (Brit) vendor and we agreed there was nothing to be done but to abort, which is just as well!!

To the best if my knowledge they decided to keep the property.

You have done the sensible thing Redfox and good luck with your continued search; sooner or later you'll find the perfect property. Just take your time ....
Nostalgia isn't what it used to be
tavi
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Post by tavi »

Well, to be fair, people do knowingly buy properties in a flood risk area, and enjoy their properties for many many years. The environmental agencies identify vulnerable areas, in order that they can take action, now or in the future, rather than for the purpose of making those places no-go areas!

To get some perspective on it: a 1 in a 100 flood risk means, apparently, that the place will probably flood 10 times in the next 1000 years!

I tend to agree with Wendy, do all the research before you make a decision. That flat has a lot going for it.

But I do understand - your heart's got to be in it!
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Nemo
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Post by Nemo »

Do ask the vendor who their insurance is with. That should be your starting point and like the others I wouldn't abort until I was 100% sure the property was not for me.

We are not directly in a flood zone but our properties are likely to fall in the sea within 100 years. In this case life is really too short for such worries. :lol:
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Giddy Goat
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Post by Giddy Goat »

Yes, that's true when you put it like that Nemo!
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Nemo
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Post by Nemo »

These things are relative. :lol: I don't wish to underestimate the possible issue of flooding which is devastating for those who suffer it, but there are a lot of people who live near a water source of one type or another (the UK is an island, surrounded by the sea, with quite high rainfall and lots of rivers after all, :wink: ); or who are at risk of flooding, often without knowing it.

I lived at the top of a hill and never dreamt of being in an area at risk. There were fields within a few yards, and when torrential rain came, it ran off the fields, channelled down the road and ended up flooding a neighbours garage, as the garage was lower then the road. I opened my back door to find the rain 6" deep, but just short of the doorsill. Thankfully the rain eased before it came over the threshold.
tavi
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Post by tavi »

I suppose my apartment is at risk from sea flooding being built literally at sea level but protected by the tidal estuary. Not something we thought of when we bought.

Strangely, the earthquake risk seems more threatening and we've insured against that. Having been shaken awake by tremors in the middle of the night several times over the years it feels like a more immediate risk...gawd forbid.
Redfox
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Post by Redfox »

Thanks to everyones advice and comments much appreciated.

I have decided to keep this property as a would buy if at the right price catagory, It does seem to have more pros than cons.

As mentioned the owners are reluctant to drop there asking price but thats now maybe in a month or two they might just cnange there minds. In the meantime as it is Scotland I have written to the estate agent to formaly note my interest. This means if there are any offers etc they are obliged to tell me apparently, not put an offer in myself but will continue my hunt and keep this one as a possability.

I have wrote below what I said to the estate agent think it gets to the point and tells them my position.

Dear xxxxxxx

I would like to formally note my interest in 5 Biggiesknowe, Peebles; however I have some concerns particularly the valuation, decoration and upgrading costs.

I noted that there will be some electrical work to do, Fireplace rebuild and re-commissioning of the chimney, a bathroom will also need to be fitted and tiled etc.

I also noted that they are in a flood zone marked out by SEPA & flood insurance would be required at much higher premiums (if indeed I can get it).

I am a cash buyer and not in a chain. I have funds in place and there are not many
buyers around. I am not a businessman I am simply hoping to buy a property at a realistic price that I can afford taking in to account costs.

If the vendor wishes to come back to me with a lower price than the asking I may be in a position to submit an offer subject to Insurance & survey.

Tells them straight I think :shock:
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