I was calling someone regarding a property we manage and in calling him I called someone else accidently, who happened to have the same name. I seem to have ten people with the same name on my mobile and often end up misdialing. However I have mastered the art of talking to a random person, until I have worked out to whom I'm actually speaking to!
So the person I accidently called this time around was an agent. Naturally I asked if there were any deals floating around at the lower levels meaning £500k to £1m.
Coincidentally he was actually at that time viewing a property in Queensway, which is priced at about 900 per sq. ft. The block is a very sought after block and hence the comparables were few and far between.
There could be two reasons why there is a lack of liquidity in a block, one is that it is so desirable to purchase once you manage to do so you never let go of the asset, unless you have to.
The other is the market for resell is so poor that no one wants to purchase, one reason for this could be that the property may be unmortgagable. There is a block like this on Edgware Rd, W2 which Prima facie look cheaps, but closer inspection reveals the property is unmortgagable, and it is poorly managed with an absentee freeholder.
The property in Queensway sounded attractive so I viewed it within the hour. I immediately took a liking to the property and after understanding the numbers I took the deal! Being south facing means it gets a consistent amount of sun which adds to the feel of the property. This property certainly has a good vibe to it, though it’s a little dated.
Having transacted business with the agent previously we are in pole position to acquire this property. The likely purchase price for the flat will be £950k, with a lease extension and light refurb the property should be worth circa £1.65m. This is an asset to hold for the next few years or long term given the softening of the market, especially at higher levels.
The area of Queensway in general has been forecasted for a massive increase in price in the years to come, there is lot of money being put in thanks to the overseas investors. This area is known as ‘the poor side of the park’, being the north end of Hyde Park it is seen as the area which is least desirable. The other areas around the park are Mayfair, Knightsbridge and Kensington. However, the smart money will be invested in this end.
Penny Wise, Pound Foolish
I met with a Landlord some time ago to run through the rent he can hope to achieve on his property, the current regulations surrounding renting and the various levels of service we offer.
This landlord opted for the management only service, this involves the landlord finding and referencing his own tenant. He even declined using our services for arranging the lettings contract, this is an important document and forms the basis on which the tenant occupies the property.
After the landlord marketed the property he received a call from a gentleman and on his word and on face value he assumed he would be a good tenant. The landlord didn’t even see the need to reference him.
On the day of move in the tenant called the landlord and explained that he was waiting for his previous landlord to return his deposit and asked if he could pay this in a couple of weeks. A couple of weeks came and went, with no sign of the deposit. The tenant then contacted the landlord and said his previous landlord kept his deposit and was being unreasonable!
The Landlord relented regarding the deposit, mostly out of not having any other choice, and agreed not to hold a deposit for the duration of the tenancy.
Rent dripped in and out and after a while the tenant stopped paying the rent altogether. This went on for an unbelievable eight months and as well as receiving no rent to pay the mortgage the landlord was going through the courts to regain possession.
It transpired that the tenant was known for moving in with the same story each time and then not paying the rent, this could have all been avoided if the landlord had opted to spend a little more and choose a service where we referenced the tenants.
Contact me on 0207 993 4719 to find out more about our fully managed service.
