Now I have to say I've not seen a project of this size for around 6 months, with many hurdles to overcome between now and a profit, but for certain this has money in it. Read on and find out why.....
Firstly let me start by saying any interested party ABSOLUTELY MUST get a full structural survey done on this as part of their pre-purchase checks, even though you cannot buy this with a mortgage (due to it currently being uninhabitable), it could be the best money you ever spend. I'm no structural engineer, but you really must get the roof checked, all the structural roof & floor beams looked at for compliance and signs of infestation, window lintels, brickwork, damp proofing (if there is any) and an overall assessment of the state of the structure. Don't worry about there being no bathroom, no kitchen, or the decorative state of the inside, because all of these are aesthetic and can be remedied by you, this is where you can build in value and see a significant return on investment. In fact, you want it to look as bad as possible to prevent others from snatching it from under your nose.
So let's assume that it is structurally sound, just how do you turn this around, what will it cost and how long will it take?
Don't doubt for a moment the amount of work needed here, but when you break it down to a list, it is mostly the work you would consider doing within 10 years of owning any property except for installing a full gas central heating system from scratch which will be a once in a lifetime install (boiler, radiators, pipework, all controls, maybe even having a gas supply brought into the building for the first time). For this alone I would allow £8k.
The rest of the work covers re-rendering the walls, updating the electrics, full repaint throughout, new flooring throughout, a new kitchen with appliances, new modern upstairs bathroom, possibly some UPVC replacement windows where applicable, and looking at exterior brickwork, drains, gutters and structures.
I am no more a clairvoyant than I am a structural engineer, but I would allow a total of £35k for all of the above work (including gas installation), however you will not be spending one penny of that if the structural survey says it is not viable, will you? Do you see why the survey is so very important on this property?
If the project does go ahead, I would think around 8 weeks of graft from a few teams of contractors that I have on my books would have this sorted for the new owner, and it could be project managed and co-ordinated by me while the new owner just goes about their everyday business (albeit writing a lot of cheques), it's all part of the complete service we offer. Once prepared and ready to let, we can sort out the final legal compliance checks (gas safety, smoke alarms, legionella inspections and a new EPC) before having this rented out at £1150 PCM, which would represent a 5.9% yield if you could keep to a total of £235k expenditure overall. How do I know it will rent for this? Well we have just rented the same house a few doors down, and this was also taken from being a run-down wreck to a beautiful family home just under 2 years ago, and we achieved a rental value of £1125 there last month. And if you really wanted to sell this and realise your profit quickly, this could be offered for sale at around £265-275k, depending on the sales market at the time of year it gets listed.
So there you have it - I've done this before, I've bought, worn and thrown away the T-shirt long before most other agents would have ever thought of doing this.
Do you want an agent who just sells you a project and leaves you to get on with it, or do you want a partner to work hand in hand with you to see the project through every step of the way? If the answer to the second question is yes, just call me to start the conversation today, because all any of this will cost you is literally just one phone call.
I will regularly post what I consider to be great buy to let deals across Milton Keynes and surrounding areas on this blog 3 or 4 times a week, irrespective of which agent they are being marketed with. Maybe you should subscribe and be kept up to date?
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