Relocating an older home to a sought after suburb and renovating or perhaps selling, will deliver near immediate returns over a modest investment. This simple yet effective investment strategy is behind an increasing number of owner builders projects.
Purchasing transportable structures from a house demolisher or house broker, is a fantastic investment and owner occupier opportunity. These relocatable structures are relatively cheap to purchase and easily transported. Professional house movers, in most cases reset a relocated house onto new footings, slab or poles, and connect most basic services in preparation for an owner builder to make ready for occupancy. The transition from relocate, renovate and move in, or rent-out can be just a few months.
Overarching considerations lie in three key activities: firstly procuring an appropriate and fit for purpose house site, and secondly the means and processes to complete or ‘subbie’ out non-structural works, to transform the relocated structures into a compliant and desirable home. For example, replacing fixtures and fittings, adding new appliances, completing landscaping and fencing if required, and finally securing Certificate of Occupancy. Thirdly, an owner builder’s competency and effectiveness to project manage activities to bring such a project to a financially successful conclusion, in other words, managing trades and subcontractors.
But like all property investments, protecting yourself and your assets is a must. Insurance should be a central risk mitigation strategy, and not just any old insurance, but one that cover investors for real risks, principally the prime and not so obvious risks areas such as sub-contractor negligence or injury liability. A good quality insurance product will also cover against early phase risks. These risks are not blindingly obvious, but are real, and can destroy the perfect project in one slip up. Vandalism, malicious damage and squatter activates are a real risks. Criminal or unintentional activities such as fire, theft, and destruction of property make-up the top 5 risk areas. Unauthorised entry and injury, illegal use such as ‘drug lab’ and other illegal activities are disturbingly common risks.
Over the past few years, more than several insurance claims were lodged for theft of actual relocated structures, and all within 24 hours of those structures being delivered to a new site. One of these cases included theft of the low-loader (trailer) and its load of the relocatable structure.
Common claims are weather related events, such as storm damage, water and rain and accidental fire, including bushfire damage.
A good quality insurance will protect the investor and their assets comprehensively. Including Public Liability, Legal Liability, 3rd Party property damage, and insurance against sub-contractor actions, injury claims, worker to worker claims, including sole trader actions and injury. Hire equipment and tools.
Relocating a structure and renovating into a sought after residence as an active rental investment or owner occupier, is an excellent opportunity to asset appreciation at super-accelerated levels. A perfect investment strategy.
Tags: kit home, owner builder, queensland owner builder., relocatable home, renovator insurance
Categorised in: ACT Owner Building, Contents Insurance, Granny Flat. Garage. Shed., Landlord Insurance, NSW Owner Building, Owner Builder Insurance Cover, Owner Builder Tools, Queensland Owner Building, SA Owner Building, Tasmania Owner Building, Victorian Owner Building, Voluntary Workers. Personal & Accident Insurance, WA Owner Building
This post was written by Technical Underwriting Centre