2 Bed Home

BUY-TO-LET WITH GREAT LONG TERM  RETURNS NEAR LOCAL AMENITIES & POTENTIAL TO TURN INTO A 4 BED HMO DUE TO IT'S FLOOR PLAN ACROSS 3 FLOORS.

  • £90,000 List PrIce
  • Secured at £70,000
  • 22% Below Market Value (in current condition)
  • 33% Below Market Value (in refurbished condition)
  • 9.18% Gross Yield as private let
  • 67% R.O.C.E Available
  • £663/Month Rental Income (LHA Rates)
  • Great Location
  • 161% R.O.C.E as H.M.O. available after refurb and remortgage: 75% BTL  mortgage at £105k full market value leaves £7,950 investment left in after the refurb.  Divided by 4 rooms renting at £350/month each minus mortgage interest @ 5% , lettings management (12%) and costs= 161.79% R.O.C.E).

Overview

This 2 Bed mid terraced property is 3 storeys with the ground floor currently comprising a living area that can be turned into 2 bedrooms.  It's located on a main bus route and close to a train station which the bus route serves.  The town centre is within 1 mile and contains national high street names.   This property also benefits from being close to schools, local shops and takeaways. 

Gallery


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Location


The property is located in a thriving central area of Swansea (population 241,300) that has a strong rental market and a shortage of suitable properties.  It is within walking distance of shops and the Liberty Stadium as well as many other local amenities.

*Population figures from 2011 census

Local Area & Amenities


The property is located in Swansea, South Wales. It is within an area of mostly terraced properties giving traditional family households.  It's a short walk from the train station, employment/commerce areas and a high street containing restaurants, takeaways, shops and bars as well as the Liberty Stadium sports and concert venue.

Financial Information


The property was marketed at £90,000 and has been secured at £70,000  

A house of the exact same design on the same street that was listed for £110,000 and in quite a good condition has just sold STC (actual sale value not yet available).  This property doubled in value from 1995 - 1998 (£16,500 - £37,000) and in the 20 years since to 2018 has nearly tripled in value since then.

Rental Income for this property would be in the region of £663 pcm (lower end estimates based on LHA rates) which would equate to gross yield of 9.18%.  After factoring in a 75% BTL remortgage at 5% the R.O.C.E would be 50.56%.  The best returns would come from turning it into a HMO where as a 4 bed it would generate over £1,400/month.  Swansea has regulatory hoops to get through to allow HMO status for a property which we can help you obtain, this isn't guaranteed and depends on outside factors, it will still work as a rental unit.

Guaranteed rental may be available on this property.

As a part of our 21 point process we have a full calculations spreadsheet that we will give, show and walk through before you commit to purchase.

Downside

The housing market could be due a downturn and we expect price volatility with Brexit.  The rent yield is solid but in the event of market turmoil you would need to hold onto the investment for a while before house prices rise.  During periods of market turmoil, properties almost always  hold their value better than most stocks and currencies/cash.

We expect the value of this property to double over the next 20 years, property consistently does this across the board.

Refurbishment



We have established an £8,000 refurbishment cost (included in all calculations) to make this property beautiful inside and of high value as a rental unit.

We have our own so called "Power Team" of contractors and experts in the area who provide high us with high quality work and finishes at great rates.


Exit Strategies


Once refurbished your total spend will be around £86,700 and the house will have a market value of £105,000.  You could exit at that point but the returns would be low after agents fees so we recommend taking the 9% rent yield for 3 - 5 years until the Brexit volatility has died down before making the next decision on whether to stick with the rent yield or sell.

After refurb you can take out a Buy To Let Mortgage and withdraw 75% of the value of the property - £78,750 which would leave you having £7,950 left in which you would recover in full from the net rental income in 24 months at a R.O.C.E of 50.56%. These figures include lettings agent management fees and an interest only mortgage interest rate of 5%, everything after that would be pure profit.

Comparables


Single room lets in the same area.

https://www.spareroom.co.uk/flatshare/?search_id=742488385&

High end HMO's are getting £110 / week in the area (we calculated at £85/month)

https://www.spareroom.co.uk/flatshare/flatshare_detail.pl?featured=1&flatshare_id=11138986&search_id=&search_results=%2Fflatshare%2Fswansea

The £110k house of the exact same design and floorplan in the exact same area:

https://www.rightmove.co.uk/property-for-sale/property-57306828.html

Due to the high demand and shortage of rental properties in the area we've had to look further afield than usual to get rental market data so have undervalued our estimates quite significantly.  These are the closest properties (within 1 mile) that are available, as you can see, there could be a potential for a much higher rental yield here:

Terms


The information contained in this presentation is an overview of the property and investment available. Please note at this stage it is within non-disclosure status.  In order to secure the investment opportunity a £2000 non-refundable deposit is required, along with ID and proof of funds.  Please note that if you as the investor decide to pull out of the deal at any time the non-refundable deposit will remain with Nest Wise Properties Ltd, unless there is a change of circumstance with the vendor and out of our control. (Should this situation occur, Life Size Properties Ltd shall refund the deposit minus £500 covering our administration and time)

Fees


The fees:

  1. Finder’s Fee - £3,500

  2. Project Management Fee - £1,000

  3. Tenancy Fees – TBC via Local Letting Agent

**ALL FEES INCLUDED IN RETURN CALCULATIONS**

What Next


To secure this great opportunity today call or email Martin or Jeani - Phone - Email or click the button to get started.