Adding Value and Discerning Buyers

[MattSu]

I am in the pre-application stage of designing and building a couple of houses, and I'm curious as to people's views on the value they place on certain architectural design and building specifications. I realise that there will be many self builders on this forum which will no doubt skew the opinions some what, however I am building with a view to sell on, and while my bottom line is important, given their rural location, I anticipate that the market for these properties will only appeal to a certain type of buyer anyway.

 

I am looking at sustainable technologies such as PVs, Air Source Heat Pumps, Green Roofs, as well as details such as underfloor heating, polished concrete floors and standing seam cladding to name but a few. All of these items seem to come at a premium and I'm wondering whether there are discerning buyers out there who would value these features enough, to pay a premium for them, or whether these features are the preserve of self builders who can cherry pick the spec ones they really want. I understand that these features may make the properties more saleable, but to be honest in most cases they are so expensive that saleability alone won't justify their cost.

 

Anticipating the final value of these properties is proving to be very difficult, because of their rural location (rural outskirts of Preston) and also because of the design. There seems to be very few comparable properties on the market. The only new builds are housing estates by national house builders, but they are around 4-5 miles away and I believe these to be an entirely different proposition. What I am very mindful of though, is over spec'ing these properties.

 

So far local estate agents have not been very forthcoming with valuations and even so they seem to have no grasp on what constitutes a sustainable home for instance. They seem more concerned about number of bedrooms, but is this only what the public cares about?

 

A4 Type 2 4 Bed House.pdf

Edited June 3, 2021 by MattSu

[ProDave]

Unless it is an area with lots of bespoke one off designs with unique architectural features, for purely build for sale, I would stick to brick walls and tiled roofs.  You will not alienate any buyers with that.

 

Then by all means concentrate on quality, good windows, good insulation and air tightness, under floor heating, ASHP, MVHR but expect probably 50% or more of buyers to take no notice of that and be more interested in the kitchen and bathroom units.

 

Most people on this forum are self builders wanting the best for them, not too bothered about cost, resale value or resale difficulties because for a lot of us, resale is something our children will have to worry about after we have moved out in a box.

[Big Jimbo]

I very much doubt that many people will be interested in all the great credentials. People like stuff like being able to turn the lights on and off using thier phones. Being able to turn the heating on when on the train. Turning the cooker on from the dest at work. People spending a lot of money on a house generally don't care about the EPC rating etc. One of the problems is that we have got it the wrong way around. Our smaller, cheaper, starter houses are what should be built to much higher standards. Loads of insulation, airtight, etc, are generally the one's that are badly built to minimum standards. If you want to sell for a bit of a premium, then look to add sexy, before practical.

[jack]

2 hours ago, ProDave said:

Unless it is an area with lots of bespoke one off designs with unique architectural features, for purely build for sale, I would stick to brick walls and tiled roofs.  You will not alienate any buyers with that.

 

Maybe, maybe not.

 

A friend of mine is a co-owner of themordernhouse.com, an estate agency specialising in architecturally designed houses operating across the UK and western Europe. We spoke to him when considering how modern to make the exterior of our house (we live in a very conservative suburb, adjacent a conservation area full of large 1930s houses). His take was that a modern-looking house will alienate a proportion of the potential purchasers, for sure, but there's a small minority who will pay a premium. The more modern and "architectural", the smaller the pool of potential buyers, but the more that minority will be willing to pay.

 

Obviously this assumes you haven't built something whacky or completely idiosynchratic.

 

 

[Mr Punter]

22 minutes ago, jack said:

A friend of mine is a co-owner of themordernhouse.com, an estate agency specialising in architecturally designed houses operating across the UK and western Europe

 

I have looked at their listings in the past and it struck me that the prices were no higher than more standard types and that the houses seemed to stick for longer.

 

Lots of things are personal preference and the OP could do well to concentrate on items that have universal appeal, like good location, easy to park, attractive front elevation and entrance hall, gas boiler, equal balance of living and bedroom space.

[davidk]

42 minutes ago, jack said:

A friend of mine is a co-owner of themordernhouse.com, an estate agency specialising in architecturally designed houses operating across the UK and western Europe.

 +1 on themodernhouse.com love having a nosey at the listings, some beautifully put together houses and interiors 

[jack]

4 minutes ago, Mr Punter said:

I have looked at their listings in the past and it struck me that the prices were no higher than more standard types and that the houses seemed to stick for longer.

 

I don't know about how long things hang around for, but I assume he wouldn't have much of a business if sellers would do as well going through a regular estate agent and selling for the same price as a similar sized Barrett box down the road. Business appears to be going well. 

 

Just now, Mr Punter said:

Lots of things are personal preference and the OP could do well to concentrate on items that have universal appeal, like good location, easy to park, attractive front elevation and entrance hall, gas boiler, equal balance of living and bedroom space.

 

I agree those aspects should be the primary focus (although in this case, many of them are already fixed, given the OP appears to be at the outline planning stage). I was focused solely on the "modern" appearance aspect.

 

The OP also needs to take into account the fact that although some will pay a premium for things like polished concrete and zinc roofing, those finishes are a lot more expensive than standard floor coverings and roof tiles. Whether the premium is enough to cover those extra costs needs serious consideration. I suspect it might work out in places with higher property prices, as the extra costs are a smaller proportion of the final property value, but less so in rural. There are no doubt areas in which you can get a more modern look without spending a lot more.

 

I doubt whether "sustainable" things will have any positive impact on price, because most people have no idea how to value them. A classic issue would be spending more on insulation to reduce heating bills by, say, £1000 a year, and having potential buyers value that extra cost at zero.

[Mr Punter]

6 minutes ago, jack said:

I don't know about how long things hang around for, but I assume he wouldn't have much of a business if sellers would do as well going through a regular estate agent and selling for the same price as a similar sized Barrett box down the road. Business appears to be going well. 

 

I really like the website and some of the houses they have look fantastic, but they often seem less expensive than more mainstream stuff.  Some look very expensive to produce but they are a bit niche and quirky for a spec developer.

 

https://www.themodernhouse.com/sales-list/hedge-house/

[jack]

4 minutes ago, Mr Punter said:

Some look very expensive to produce but they are a bit niche and quirky for a spec developer.

 

https://www.themodernhouse.com/sales-list/hedge-house/

 

As you say, that's quite a quirky example. They aren't all like that, nor am I suggesting that any developer should consider going that niche.

 

I don't know the area. What would £3m quid buy you in a more conventional house of the same size on the same land?

 

 

[Mr Punter]

1 hour ago, jack said:

 

As you say, that's quite a quirky example. They aren't all like that, nor am I suggesting that any developer should consider going that niche.

I don't know the area. What would £3m quid buy you in a more conventional house of the same size on the same land?

 

You will achieve a far higher price per square metre for this sort of thing and it will be cheaper to build:

 

https://www.rightmove.co.uk/properties/80178027#/

[Ferdinand]

Valuing of eco-credentials etc *does* happen, but it is only developing slowly.

 

Expect it to change if, eg, the Govt slug Stamp Duty for inefficient houses, or add a band to Council Tax for houses D or below on EPC.

 

Or put VAT properly on heating fuel.

[MattSu]

2 hours ago, Mr Punter said:

 

You will achieve a far higher price per square metre for this sort of thing and it will be cheaper to build:

 

https://www.rightmove.co.uk/properties/80178027#/

 

I think there is a misunderstanding on what I am asking. I am not looking for tips to maximise profit by completely passing over contemporary design in favour of a producing a twee country cottage, however desirable they maybe to some, I have absolutely no interest in following that design path. 

 

What I am trying to focus on, is whether the people out there who favour contemporary design, would pay a premium or value certain material/architectural details and specifications, because there is a shortage of that type of housing in this area. So far the consensus (rather surprisingly for the self build community) seems to be no?!  

 

 

[Bitpipe]

6 minutes ago, MattSu said:

 

I think there is a misunderstanding on what I am asking. I am not looking for tips to maximise profit by completely passing over contemporary design in favour of a producing a twee country cottage, however desirable they maybe to some, I have absolutely no interest in following that design path. 

 

What I am trying to focus on, is whether the people out there who favour contemporary design, would pay a premium or value certain material/architectural details and specifications, because there is a shortage of that type of housing in this area. So far the consensus (rather surprisingly for the self build community) seems to be no?!  

 

 

 

I think the consensus is that you will be marketing to a much narrower segment of the market but they may be prepared to pay a premium for such design.

 

When it comes to 'green' features, I think they're better presented as generating a comfortable, consistent and efficient living space as opposed to virtue signalling.

 

Our house is quite contemporary in appearance and is passive standard. However visitors comment that it's always a consistent comfortable temperature year round, the air is fresh, there is plenty of natural light and the energy costs are low (£2-3 per day over the year).

[Mr Punter]

With the designs you have you could bring the cost down and make the houses more comfortable by reducing the glazed areas in some of the rooms.  Full height glazing in bedroom windows that are overlooked and / or amount to more than 25% of the floor area are worth altering.  Glazing is far less energy efficient and more expensive than external walls and you can end up with unwanted solar gain / overheating.  Use it where you have great views though.

 

I notice also that the oriel window on the back could clash with the window below and downpipes and window treatments are almost impossible with a glazed gable.  The garage looks a tricky cold bridge.

[jack]

3 hours ago, MattSu said:

What I am trying to focus on, is whether the people out there who favour contemporary design, would pay a premium or value certain material/architectural details and specifications, because there is a shortage of that type of housing in this area. So far the consensus (rather surprisingly for the self build community) seems to be no?!  

 

Not surprising to me at all. I think self-builders are as reflexively conservative as the population as a whole.

 

As for valuing design, have you seen the typical attitude to architects on this forum? 

 

Personally, the whole country cottage aesthetic doesn't work for me. I'd pay a small premium for better design and a contemporary look, or go for something slightly more compact for the same price.  

[SteamyTea]

PV is worth having, can be installed at build time for about the same price as traditional roofing.  Make sure the house orientation is suitable, and no shading, so get rid of that porch roof.

Ditch the idea of a green roof, that just shrieks "leaks" to me.  Fine on the garden shed, not on a house roof.

Triple glaze, people are interested in the triple bit, not the U-Value, so they do not need to cost more.

UFH is not anything new, fitted to a lot of mass produced places now.  Just up the amount of insulation under it, more than BR specify, you have a larger delta temperature.

ASHP definitely, but make sure that there is room for a decent sized buffer tank and cylinder.  Don't skimp on the power output, oversize by at least 30%.

Don't skimp on insulation, and make sure airtightness is as good as it possibly can be, AT TIME OF BUILD.

As for looks, drive around your area and see what high priced places look like.

As for rooms inside, I like separate rooms, hate it when a room becomes a corridor (which I have and it stops me using the room, and I live on my own).

Make sure all bedrooms can take double beds.

As for 'connected houses' don't bother, with a ASHP/UFH combo, there is no need to adjust it when away for a few days, same with lights.  Who really feels the need to turn lights on and off, and if left on, they only burn a handful of watts these days.  No more 25W downlighters in a small kitchen (have seen some people fit 40 of them in in a 4m by 3m kitchen FFS).

 

Decent garage/shed that can be an office will appeal at the moment, tough i suspect that people will be flocking back to offices in the not to distant future.

 

 

Edited June 4, 2021 by SteamyTea