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3 Bed Semi Leeds - Answers on a postcard

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  • 3 Bed Semi Leeds - Answers on a postcard

    Hello, looking for some much needed advice.

    I'm 21 and my housemate is 24. We've been looking for properties for the past 3 months or so, originally to buy a 4 bed mid-terrace and let it out to students, but since then with the market stablising and deals to be had from repos we've turned our eyes to actual development/renovation.

    We've found a 3 bed semi detached property in quite a popular area in Leeds. The house must have been originally decorated by Ronald McDonald as I can't see who else would have put down the carpets etc that are currently fitted.

    Anyway....apart from that to the naked eye the house looks like it could just do with cosmetic improvements, plus the kitchen needs finished (There is no electricals, just units, which to be fair aren't bad and in good nick) and there is also a bathroom upstairs that I'd fancy replacing.

    Good sized Garden, offstreet gated driveway. Average selling prices in the street seems to be between £110,000 - £140,000 and surrounding streets anything up to and over £200,000.

    Looking to buy it for £95K, spend between £8-£10,000 turn it round in a couple of months, effectively give it a facelift and get it back on the market for £135,000......accept £125K minimum.

    Would much appreciate any thoughts, advice........on everything from estimated renovation costs to......you get the idea.

    Thanks in advance.

  • #2
    Re: 3 Bed Semi Leeds - Answers on a postcard

    Feeling slightly let down at the fact that almost 90 people have had a look at this post and not 1 person has made any kind of comment what so ever.......not a very encouragng lot are you. lol.

    Comment


    • #3
      Re: 3 Bed Semi Leeds - Answers on a postcard

      Hi there,

      Personally I would guess that the lack of response is in part related to the lack of specific questions. You seem to already know everything that you need to know to make a decision (i.e. buy a house for £95k, spend £10k renovating, and sell for £125k).

      That sounds like a good investment, what you might call a "no brainer", so why are you asking for advice rather than putting in an offer?

      You've asked for thoughts on renovation costs - that's partly down to the actual condition of the property, partly down to personal preference as to the quality of the fixtures, fittings and decor and it's also down to how much work you can put in yourselves or if you need to pay tradesmen. Giving a measured, well considered response without more information is a bit tricky.

      I think you neeed to ask more specific questions in order to elicit a response from the forum. Tell us how you've arrived at the estimated £8k-£10k renovation budget, or did you just guess? How are you going to finance the purchase and the renovation? Are you going to live in the property whilst renovating, or are you going to continue to pay rent and also a mortgage on the purchased property? Do you work full time or are you able to dedicate yourselves to renovating the place? Tell us what your concerns are about this specific property.

      But also ask yourself this though: if the property is that good an opportunity why hasn't a developer with cash in the bank already snapped it up?
      ____________________________________________
      Property for sale in Torquay

      www.thomasdobner.co.uk

      Comment


      • #4
        Re: 3 Bed Semi Leeds - Answers on a postcard

        Thanks for the response, my first post, so should have thought through what I was saying first I suppose.

        Project is being financed by a 100% Staff Mortgage with Yorkshire bank. 2.4% over base, no arrangement fees, no early repayment charges, it's about as good as they come. Renovation is being financed with cash, we had 15% deposit for a mortgage, but there's no point tying up the cash when we can get a 100% mortgage.

        The house needs, new carpets/flooring, painting, new bathroom & new kitchen. All the windows are double glazing so their ok. House is in good condition, however I may have found the answer to your questions as to why another developer hasn't snapped it up on saturday night.

        We went for a drive around the area to see exactly what was around the house, bear in mind this is a very popular area with young professionals/young families.

        Anyway we saw a park just down the street almost behind the house so we went to have a look what was there..............A horrible horrible council estate, with the house numbers painted on the walls.

        Then as we went to turn round in a one road in, one road out dead end, a black car came cruising down full of young black guys and not one of them took their eyes off us, I turned the car round and the next minute they followed us all the way home!

        We then got home to find out that the there is 2 streets behind the house that have been having an ongoing turf war, and at the end of last year their was a stabbing 300 metres from the house.........I'd take a wild guess and imagine this is why the house hasn't been sold yet, because even if it was really nice you probably couldnt get rid of it.

        Disappointing because it looked like the ONE.

        Comment


        • #5
          Re: 3 Bed Semi Leeds - Answers on a postcard

          Hi there,

          You mentioned previously that the average selling price in the street is £110k - £140k, whereas neighbouring streets (presumably the ones further from the "trouble spot") are selling for £200k or so.

          Having now discovered the issues with the area you have now come to the conclusion that the house is unsellable, but in reality almost any property will sell if the price is realistic. The fact that prices in this street are so much lower than those nearby is already an indication that the location is less desirable as you would expect.

          When was the last property sold in that particular street / area?

          If nothing there has sold recently then perhaps you are right in thinking that the location will be an issue for re-sale, but if the price you expect to acheive is well below local averages because of the location then there's no reason to conclude that it simply wouldn't sell at all.
          ____________________________________________
          Property for sale in Torquay

          www.thomasdobner.co.uk

          Comment


          • #6
            Re: 3 Bed Semi Leeds - Answers on a postcard

            There are some houses that are not easy to get a mortgage on as well due to technicalities in the deeds (like unauthorised extensions)

            Comment


            • #7
              Re: 3 Bed Semi Leeds - Answers on a postcard

              IFA appreciate the advice. We had come to the same way of thinking as your describing and houses have been selling in the street in fact there's a few on at the moment for £125 - £135k.

              Went for a meeting with the estate agent yesterday and there is a women who apparently really wants it. I had come round to the idea of going ahead with the purchase, but it's a repo and to get the house we'd be looking at paying the full asking price of £100k or more depending on how much the other buyer wanted it.

              In short it's now not quite looking the investment we hoped it would be.

              Although I should mention that I called the police to find out a bit more about the council estate behind the house and he said between you and me the council has scheduled to demolish the council estate and sell the land off to a private investor to redevelop the area.

              That's the kind of info that could make you some serious money, but unfortunately with councils the time scale could be anything from 1-5 years, and I'm not prepared to wait 5 years to see a return on my investment. I want to be really up and running by then, not waiting to sell my first and cheap house.

              Cnandu, just to add. Appreciate the input, but incredibly random. Where did I say there was this unauthorised/illegal extension?!?!?

              Or was that just an after thought? lol thanks anyways.

              FTMP

              Comment


              • #8
                Re: 3 Bed Semi Leeds - Answers on a postcard

                Not the investment you wanted?

                Buy for £100k on a low-cost, low-fee 100% mortgage, spend £10k renovating over a couple of months and then re-sell for £125K?

                How much money do you want to make from your investment over a short period and on a part-time basis in addition to your regular earned income?

                Don't forget that all you are starting out with here is £10k of capital, if a £15k (150%) return on your money over a period of a few months isn't good enough for you then you need to change your surname to Buffett and jump into some risky stock market gambling to do better than that. (Ok - there will be some fees to be deducted from the profit but you get the point)

                You'll never find the perfect property, especially with a limited budget and with cash investors banging on the estate agents' doors every day waiting for a bargain. There will always be a need for compromise and you might just have to accept that you will never be able to make a massive profit on your first property project when there are limitations imposed by the amount of finance available to invest.

                Sorry if that sounds harsh, I don't mean it to, but I think you're expecting too much for too little and you'll always find a reason not to invest.
                ____________________________________________
                Property for sale in Torquay

                www.thomasdobner.co.uk

                Comment


                • #9
                  Re: 3 Bed Semi Leeds - Answers on a postcard

                  Cheers for the reply IFA, even if it was somewhat abrupt lol. We're in a very unstable market, rumours of a double dip depression, coalition government, I think a potential 15% return on the overall purchase price, because you say that I'm only putting down £10k, but in actual fact my liability is for £110,000.

                  So If I sold at the top end of the market, I'd make £15k, minus the estate agents sellers fees, minus soclitors fees, your talking £11-12,000.

                  Then split that between 2 people. £5,500. Not worth the risk is it if we're being honest.

                  Anyway I've found a potentially better house, but could do with knocking some money off it.

                  I don't suppose you have any tips for getting a price down?

                  FTMP

                  Comment


                  • #10
                    Re: 3 Bed Semi Leeds - Answers on a postcard

                    Hi FTMP, sorry if the last post was abrupt - it was getting late! :-)

                    I'd still say that your profit is the difference between the amount of money you start with and the amount of money you finish up with. In the previous scenario you were starting with £10,000 of your own cash being invested in the renovations, and hoping to finish up with a minimum of £20,000 after all costs and expenses. That's still a 100% profit, even if it is split between two people (presumably the initial £10,000 is being contributed 50% each too, so you each invest £5,000 and earn £5,000).

                    Anyway, aside from that it's good to hear that you've maybe found a better opportunity but it sounds as if it's only potentially a better option if you can successfully negotiate a cheeky offer?

                    With regards to getting a good price on a property, start lower than you are willing to pay, always give yourself room to increase your offer to your "Best and final" amount. Maybe have a survey done to identify any issues with the house that can be used to good effect when negotiating. Make sure the agent knows that you are serious about making the purchase and that you are in a good situation being chain free with a staff mortgage approved. Stick to your maximum and don't be tempted to go higher, make sure the agent explains to the vendor that it's a "take it or leave it" offer and that you will not increase above the amount you have set as your limit. If they decline the offer, call the agent every few days to see if the vendor has had time to re-think, make sure they know that the offer remains open for them to accept at any time. Be prepared to walk away and find another property, let your head rule your heart when you are purchasing for investment purposes.

                    I don't know if any of that helps, maybe others on here will pitch in with some suggestions?
                    ____________________________________________
                    Property for sale in Torquay

                    www.thomasdobner.co.uk

                    Comment


                    • #11
                      Re: 3 Bed Semi Leeds - Answers on a postcard

                      Search Online in Google

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