This is a two for the price of one deal I did last year (2014).
It came through a professional sourcer who was having trouble shifting it, he’d heard I’d buy anything at the right price but was quite apologetic as he just couldn’t see a market for this, it was such a weird property. He thought it was partly a flat and partly a leasehold house tacked on the side with only one very large bedroom upstairs. They’d tried to sell with a traditional agent and failed. It simply wasn’t what any normal person would want. Then they dropped the price again from £150k to £130k and it looked like a lot of square footage for the money so I went to see it.
It kind-of looked like 2 properties that had been joined together, a flat and a house. Talking to the owners confirmed this.
She had moved into the flat. Then they’d got together as a couple and he bought the house next door. They’d made a hole in the wall between to join them together. The title deeds were confusingly drawn up including a crossover lease with the flat above, unusual for Bristol and that probably confused people. I got my solicitor to check and he confirmed they were indeed two separate properties! Wow!
They wanted to sell FAST, they’d already bought another house in WSM and had a lot of stress over it.
Back then there was still a SDLT threshold at £125k so I said I could guarantee a very quick cash sale at £125k to avoid the SDLT and they agreed. I felt very comfortable with that because the same size flat upstairs had been advertised at £145k and sold for £137k, so we were getting the house for free! Here’s the link on RM http://www.rightmove.co.uk/property-for-sale/property-41961562.html
We were supposed to get VP on completion, the last day for the auctioneer’s catalogue. But the sellers were still there! Apparently the sourcer had said they could stay an extra week after comp but had not told me to avoid jeopardising the sale. The woman seemed extremely anxious (as she had been all along) so I did my best to reassure her we wouldn’t be kicking them out, asking for a cup of tea as it’s a great way to get everyone sitting down which naturally makes people more relaxed. Also getting someone to give you something small is a way of making them value you as a person. And, I like tea! It was such a great deal I wasn’t going to make a fuss over getting VP a week late, but we missed the auction deadline so we owned the property for a month longer than was ideal.
When they left all I did was spend a couple of days separating the two dwellings with a partition, and re-opening the front door to the house. That was about it, apart from getting black spray paint to mark a better layouts upstairs for 2 bedrooms, another window and a staircase with winders which take up less room. No need to actually do the work just make it easy for people to see the potential then let them do it themselves. The house wasn’t connected to any of the services either except sewerage, it’s a world of pain dealing with Transco so far better let someone else do that and throw it straight into auction.
I got the agent who sold the flat above to market the flat. I motivated him by offering 50% extra commission if he could sell for £125k by a certain date, he thought I was his new best mate! He managed but sadly the buyer couldn’t get a mortgage so into the auction it went. I wasn’t happy about that as flats don’t sell well at auction but I needed the money for another deal. It made £105k in the room so someone got a cheap flat and I dropped £20k unnecessarily because the other deal never came about anyway. There is a learning there. Here’s the listing on RM http://www.rightmove.co.uk/house-prices/detailMatching.html?prop=45299864&sale=51182684&country=england That’s the plasterboard partition at the back of the 2nd picture dividing off the house, and that’s my silver van in the last picture.
The house sold for £90,500 the flat for £105k so a total of £195,500 and gross profit of £70,500 from the £125k we paid – not bad for 2 days work. Obviously we had transaction and holding costs too. But my JV partners and I walked away with about £30k net each.
I drove past it recently, there’s a new window right where I drew it on the wall. The house has been extended. The flat looks like it’s been sold but there’s nothing showing up on RM just yet.