Wanted to share a recent event this week in which we had an issue with a Gable wall in an HMO we just finished. No matter how much experience you might think you have, there will always be issues. Always budget in for unexpected surprises when refurbishing.
Myself and my colleagues have been building and refurbishing for years. We always look for cracks or subsidence in terraced houses & HMOs we look to buy. In Manchester you have a great deal of old mining areas and there has been movement under some of the terraced housing. What is very interesting in a recent property we finished refurbishing, it was not in a mining area as per our solicitor yet we had an issue. Our builders did not note the issue even though they have been in the business 40 years plus ….as well as us. More so the HMO was inspected and passed by our commercial let with guaranteed 5 year let in which they pay all bills and manage. They did not discover the issue either in the HMO.
In order to lower leverage, we sell some properties & HMOS and we keep some HMO properties. This property we sold at a 9% Net yield to an investor. They completed a drive by and suggested to have the gable wall checked. We agreed that we would pay for a structural survey. To our shock, the report from the structural survey suggested we rebuild the gable wall. As this investor has purchased numerous properties from us we agreed to do the works on the gable wall.
Lesson learned…now all properties we buy will have a structural survey. No matter how much experience you might have or even your builders, it is worth it. If a property has an issue you can always go back to the vendor with the issue and re discuss price.
Recent Comments