The worst house in the best street

“Remember to look for the worst house in the best street, not the best house in the worst street” is an age-old real estate-ism that you will no doubt hear bandied about almost anytime anyone mentions buying a property. 

I thought it would be interesting to take a closer look at this old cliché, to see what truth can be found in it. From my own real estate experiences, buying the ‘worst house on the block’ is not a simple concept – and is not always going to be a straight out good decision. There are several factors which come in to play here…

 The worst house/best street phrase often refers to the overwhelming importance that most people place on location. Where a property is located generally is much more important that what a property looks like, as it’s something (unless your ‘house’ is the kind on wheels) that you just can’t change. Properties that are closer to public transport and infrastructure such as schools, shops and sports facilities tend to achieve a higher value than similar properties off the beaten track, due to factors of convenience and lifestyle. So in saying this, compromising cosmetic features for a better location is in most cases a wise decision.  For instance, a friend of mine who is a valuer has recently bought the ‘worst property’ in the ‘best street’. She studied values of properties in street adjacent to the Brisbane River, and although the property doesn’t have direct waterfront access, the property she bought benefits from being located in a street with a high medium price. 

It also depends whether or not you are buying a property to live in, or as an investment. If you’re going to be living in the property, then you need to consider whether you can live there whilst renovating. As an investment property, remember – every week that you don’t have a tenant installed is costing you money. Add this to renovation costs, and it can add up to a bad decision. However a clever cosmetic update (particularly bathrooms and kitchens, functional outdoor space) can greatly increase the value of a rental property.  

It’s important to be very realistic about the proverbial ‘worst’ house in the street, and know exactly what you’re getting yourself into in terms of repairs and renovations. How bad precisely is ‘worst’?  Are we talking about a highly offensive colour-scheme and a backyard that makes trekking the Kokoda trail seem like a walk in the park? Or are we talking other deeper, darker (and potentially very expensive) issues, such as structural damage, termites or drainage problems? Some problems are easy to fix – a new vanity here, a coat of paint there – you get the picture. Some are not, and can be a lot more trouble than they’re worth if you don’t have any practical skills in home renovation (as well as miles and miles of patience!) 

Timing is also a crucial element in deciding on the type of house you could manage to live in with regards to renovations, to what extent of work needs to be done. There may be some periods in life where a major renovation would be a fun adventure (ha!), and other times (i.e. if you’ve just given birth to octuplets) when extensive renovations may be somewhat ill-advised. So consider how much the renovation will affect the lives of everyone living in the house, and the costs of temporary accommodation if necessary. 

 It’s a good idea to hire a qualified building inspector and report on any property that you are seriously considering buying, as this could save you thousands if there are major problems uncovered. You should also be mindful of heritage/preservation restrictions in your area, before purchasing a house that requires major renovations, as this could place considerable restrictions on what you can actually change.  

There are bargains to be had by buying the ‘worst’ house in the ‘best’ street – especially if you are willing to put in the time and effort. But to reap the rewards, you’re going to need patience and a plan, because the phrase ‘renovators dream’ can often be an oxymoron!

Posted by Reality Bytes - Real Estate Training Blog on 09/11/2009 at 9:35 AM | Categories:

3 Comments

tasmania house

tasmania house wrote on 19/01/2010 7:58 AM

Sensational info. I look forward to seeing more.
Home Loans

Home Loans wrote on 23/02/2010 1:29 AM

So true. A worst house in the best street would give you a better hold of your time, money, and effort, unlike the other way around.
tasmania computing

tasmania computing wrote on 23/11/2010 7:55 AM

Great article, it's nice to have these principals reinforced.

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