We have a block of flats we are trying to get through legals. It is never easy and want to make sure all of our boxes are ticked. We have been waiting on a certificate of lawfulness for several weeks. If the vendor can not provide we need to simply walk away. However we have two other projects in the pipeline also going through legals.
Once we have the certificate of lawfulness, we will do an inspection with our builders once again. This a block of 8 flats. 7 x one bedrooms generating £85 and 1 x two bedroom generating £113.92. The gross rents on this block are close to £37,000 per year. We are purchasing for £222,000. Including legals, SDLT and refurbishment we will be approx at £255,000. This comes to a cash on cash of approx 14.5%. As we are conservative property investors we will look to have a £125,000 first charge on the property if we do not sell the property after 6 months of full tenancy. We would look for a capital repayment loan and assuming if interest keep up the way they are going ( unbelievably still going down once again). Assuming approx £700 a month in payments max…..Approx £28,600 NET. As we focus on Social housing we are in talks with a charity to take the property with a guaranteed lease, no voids and no management.
Bottom line we are looking for approx +20% return while treading water to sell the property after updating and placing the Social Housing provider.
If anyone is interested to know more about our refurb/conversion projects and if anyone who wants to be our next private investor or JV partner just PM or email us…Happy holidays.
Recent Comments