CASE STUDY: 3 BED BUY-TO-LET, North East
Man, we love this property!
This property shocked our builder, he said it was the worst condition property he's ever worked with (that's what we like to hear!). It had been empty for 4 years, and when we started working with it walls and ceilings just disintegrated from being poorly cared for. Here are some juicy shots of the BEFORE...
Anyway, that's a distant memory. It shined up real nice and it's now operating as a lovely, clean, safe home for a professional couple and their kids (keep scrolling for the AFTER shots!).
We learnt some great stuff on this project, here are some of our key take-aways!
Know your exits.
We initially bought this property as a flip in personal names. However by the time we had started the refurb Charlie had unexpectedly used his capital gains allowance for the year so that affected our profit margin.
Because we had stress-tested this property as a buy-to-let, we had the agility to switch up our strategy even mid-way through the project. So that's what we did - the refurb is slightly more premium and we left slightly more money in than we normally would on a buy-to-let but the numbers still work.
Know your council.
We knew the council this house falls under didn't offer an Empty Homes Grant. We rang anyway. When we finally got in touch with the right person they told us that 'funnily enough' they were just working on re-setting up the Grant.
It took 6 months of relationship building (and for the Grant to work its way through all the bureaucracy) but we got there, and long after the property was let a neat little £6,000 dropped into our account. Technically we shouldn't have got it as the initial council inspection was supposed to happen before any work starts - but because we took the Council on the journey with us they made an exception.
It probably took about 5 hours of meetings, forms and emails - but don't know about you we are happy to work at £1,200 an hour!
Total win:win! Grants help us continue to invest and rejuvenate neglected properties and areas, and investors like us help Councils with their 'New Homes' targets.
Know your area.
This property is let in an area where rental value and demand differs street on street, village on village. We work with a number of pure Letting Agents (not dual sales/lets) and leverage their specialised area knowledge to pinpoint properties that will Let well, at the values we need to make our numbers work.
As our Agents specialise in Lets they aren't interested in over-inflating rents and done up values to get a property sale - they give us their realistic view on achievable rents which means we aren't disappointed when the property hits the market.
Here is what this one became >>>>
Purchase price: £78,000
Done Up Value: £125,000
Rent: £650 pcm
We'll put money into deals like this ALL DAY!
Got any questions on the above? Drop us a line to firstname.lastname@example.org or give us a call on 07546 820 941.