Yorkshire Lad Posted January 8, 2009 Share Posted January 8, 2009 Just watching "Buy it, Sell it, Rent it?" on BBC1 Follows a developer in a London suburb as he tries to renovate a London terraced place into 3 flats. Bought the place 8 months ago for 500k spending 100k doing it up. Problems getting financed - used the term 'had to go around with the begging bowl to lenders' but couldn't obtain any, so had to use his own cash flow. Sounds like he is in real trouble, as he seems to be saying he's having trouble paying for the rest of his portfolio of 200 using the rents. So after 8 months still not developed, also used the excuse for not finishing yet blaming it on other projects that are going on. The programme demonstrated what problems developers are facing right now. 500k buying it 100k spent doing it up 2500k mortgage for flats in IO ea prediction 4k for rental for all flats. Is it worth the effort? Quote Link to comment Share on other sites More sharing options...
ezkay Posted January 8, 2009 Share Posted January 8, 2009 (edited) Not to mention the valuation done shortly after he purchased the property, which put it at £350k - a 30% drop before he's even started to spend money on renovations. The program then shied away from it's usual 'final valuation' format and just estimated what he'd achieve in rent only (which doesn't take into account, voids, repairs, etc). I wonder why Edit: sp Edited January 8, 2009 by ezkay Quote Link to comment Share on other sites More sharing options...
Selling up Posted January 8, 2009 Share Posted January 8, 2009 500k buying it100k spent doing it up ea prediction 4k for rental for all flats. Are you serious? 600k capital to generate 4k rent????? That's a yield of 0.7% Surely some mistake? Quote Link to comment Share on other sites More sharing options...
zilly Posted January 8, 2009 Share Posted January 8, 2009 Are you serious?600k capital to generate 4k rent????? That's a yield of 0.7% Surely some mistake? <sigh> Quote Link to comment Share on other sites More sharing options...
bobthe~ Posted January 8, 2009 Share Posted January 8, 2009 Are you serious?600k capital to generate 4k rent????? That's a yield of 0.7% Surely some mistake? per month? Quote Link to comment Share on other sites More sharing options...
tim123 Posted January 8, 2009 Share Posted January 8, 2009 per month? And he achieved this by squashing as many rooms into the house as possible. He should have turned the ground floor into a nice 2 bed, instead he made it into a three bed by dividing the main bedroom. He called them "all doubles" but they were tiny, about 7 ft by 10ft. And on the upper floor he should have extended into the loft with a big master/en-suite for a nice three bed. Instead he made the loft space into two of his tiny doubles and a toilet squashed into a corner, with the main floor having three tiny rooms (as on the ground) for a total of 5 bedrooms. He thought that this was going to get him more rent. Bon't buy it myself. tim Quote Link to comment Share on other sites More sharing options...
scuuzeme Posted January 8, 2009 Share Posted January 8, 2009 Are you serious?600k capital to generate 4k rent????? That's a yield of 0.7% Surely some mistake? I doubt he'd have to worry about too many voids at 4k a year, that's for sure! Quote Link to comment Share on other sites More sharing options...
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