The new property craze - knock 'em down, build 'em up

The credit crunch is currently sweeping all before it in the nation’s media – allowing for brief excursions into Home Secretary buys doner kebab and Britney goes doolally territory.

But out there in the suburbs no one’s listening, because there’s a new craze sweeping commuterland – buying houses and knocking them down.

While warnings of financial doom echo around them, the wealthy citizens of the Home Counties are busy snapping up properties, demolishing them and putting something a lot more opulent in their place.

This trend is similar to the garden grabbing movement, which specialises in buying up nice spacious detached homes with large gardens, knocking them down and putting more homes on the plot. But while garden grabbing can fulfil the property developer instincts of the suburban empire builder, it makes properties smaller and so doesn’t meet the status requirements needed when securing a place to live.

The answer therefore is to buy one of the detached homes built between the 1920s and the 1960s when developers believed in rooms large enough to open a wardrobe door in and gardens big enough to kick a ball in.

Then you knock it down and build your dream home.

If you want proof of this craze just visit the council planning website of a desirable town round London, or better still find the local paper property listings. The key phrase to look out for is ‘potential to extend and improve subject to planning permission'.

My parents live just outside Harpenden, near St Albans, classic buy a big house and knock it down territory. Flicking through the local papers, the amount of planning applications going in, or houses subtly suggested as ripe for demolishing is staggering.

But even more amazing is the price people are paying before indulging in their new-build dream. Homes are being bought to be demolished for £1m-plus, with the buyers then looking at a £300,000 - £400,000 rebuild, landscaping and fitting out costs.

Rising from the ashes are what could be described as houses from the mock Victorian Mansion school of architecture, or maybe New Doll’s House school would be better.

Essential features are a couple of gable ends, an imposing drive for the baby Bentley, some big iron gates, enough outside lights to land an aircraft and an en-suite bathroom for every bedroom.

Now this isn’t meant to sound snobbish or churlish, although surely an en-suite for every bedroom in a family home is a recipe for never-ending parental cleaning.

In many cases these properties are an improvement on what was there previously - even if they do have a tendency to be imposing and all look slightly the same.

However, the knock ‘em down, build ‘em up craze is fascinating considering the general economic outlook at the moment and shows that while people might be starting to feel the pinch there is still a hell of a lot of money out there. There has to be for people to be paying top whack for luxury homes, only to knock them down.

Our typical New Doll’s House developer is a well-paid company director, lawyer or City worker, in their 40s or 50s. They have made a nice profit on their past 15 – 20 years of home ownership, have a healthy £500,000-plus in equity and a mortgage similar in size to most first-time buyers. They are happy to spend some bonus and take on a bigger mortgage to fund their new dream home and don’t plan on moving for at least five to ten years, so believe they can ride out any property storm.

An Englishman’s home is his castle - owning a big deluxe family home is what people aspire to.

The wisdom from the sceptics may be to sell up and rent for a while, but it’ll take more than a salvo of bearish warnings to change the nation’s psyche.

- Simon Lambert, This is Money

Useful links:

Analysis: Will there be a house price crash?

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Comments

[jlh]

Although this is a sure fire example of how stinking richer the already rich have become, I have no doubt this would improve many parts of Croydon

[Danny]

Fantastic, this should be "policy" not a craze. There are thousands of acres of rubbish, crumbling, not-fit-for-purpose houses across the UK, currently commanding eye-watering prices. The more of these energy-inefficient old wrecks that are removed and replaced by new stuff built to a good standard, the better.

[DIANE]

This is all quite common here in western australia. When you buy a place the most important thing is the value of the land 'plot' as they call it. There is nothing unusual in buying a 20 year old house on a plot and demolishing it to build something more to your liking.

[Yolanda]

I'm not sure about the "stinking richer" comment but this is exactly what we did. Found a property that could have been blown over in the wind, demolished it and built a family home. We wouldn't have been able to afford our home in it's "finished" state any other way.

We loved every moment of the design and building process (except maybe living in a caravan!) and have embraced eco technologies such as ground source heat pumps and rain water recycling. It's our affordable dream home built exactly to our specification that happens to keep energy bills down whilst ticking the echo friendly boxes. The only down side is I do do more cleaning!

[Stuart]

I too am from OZ, now living in London, I feel that this too maybe a craze, but should however be the norm. My wife and I are in the property market looking to purchase a new family home in SE London, Bromley etc. With a budget of £700.000 GBP. However we are constantly dismayed if not disgusted by the overall quality of housing in this country even within our budget range, do people here know that its a new century or are they still living in the beginning of the last century. In my opinion the brits of the Victorian era were more modern and had contemporary sensibilities then modern brits. Currently it seems most people are happy to live in 100 / 200 year old total shit rubbish crap run down property and then try to flog it off to make a huge profit, I have never seen so many crap disgusting properties in my life, If it were up to me I would demolish 80% of the UK and build new houses not new houses that look like old crap houses but houses that represent our century and current and future modernistic culture. Where can one find a good plot of land here close to London and home counties, so I can build a proper modern home. Bring on Modernity, come on Britain get with the program....

[lucy]

Yes people are stingy on the modernisation bit but thats not to say we should knock down all the old and often graded buildings.As for oz ,it naturally does not have as much history as England,which I think is important to keep!!
Lucy