What you need to know before investing in a listed building

But before investing in a grade listed building, it’s wise to be sure of the cost involved, and how any risk can be reduced in the process.

A listed building is a property that is recorded on a national register due to its architectural or historical significance, with the aim of protecting and maintaining such structures for future generations.

Although protected by law, listed buildings can be modernised with consent. Bringing a listed building to market can be lucrative as they offer something unique to homebuyers.

Research by Alliance Fund has found that the estimated average asking price of a grade listed property across England is currently £750,000, 131 per cent above the national average asking price.

This is partly because grade listed buildings can be hard to come by in the open market.

The study revealed that there are an estimated 379,337 listed buildings recorded across the nation. This equates to just 1.5 per cent total in England, with Grade One listed homes accounting for just 0.04 per cent.

Iain Crawford, CEO of Alliance Fund, said: “The rarity of grade listed buildings sets them apart from any regular bricks and mortar investment as they are essentially similar to investing in rare jewellery or an antique piece of furniture.

"They hold their own, unique value and their limited supply can ensure that this value is held regardless of what might be happening across the wider property market.”

Things to consider when investing

When purchasing a listed building, there are several factors to consider. First, you will need a Listed Building or Historical Building Survey.

Then there is the requirement for specialist property insurance due to the higher rebuild costs associated with a listed home. These costs are also higher when maintaining the property as it’s likely you will need specific trade skills and materials.

There will be restrictions on how much work you can do to the building and you may not be able to make any significant modifications to the external structure or the internal layout.

However, it may be possible to add a significant amount of value by repairing and modernising the property in part.

How to reduce risk when investing

When investing in a listed building, the best way to reduce risk relies on what and who you know. Getting a full view of what you’re investing in upfront is essential, so it’s worth paying for a full structural survey to identify any issues or defects, and what needs to be done to rectify these within the rules.

Have a top solicitor on hand to advise you on legalities and restrictions, so you can plan properly.

Get experienced hands on board, including tradespeople who have worked on grade listed buildings, to review the job before you begin.

Never cut corners when it comes to obtaining correct permissions, as adjusting your plans during the initial stages is far more time and cost effective than having to do so halfway through the renovation process.

Finally, be aware of grants that are available to subsidise funding for repairs, as these can help substantially in keeping costs down.

For more information about Alliance Fund, visit www.alliancefund.co.uk