Projects

The property was a repossession so we knew next to nothing about the building’s history, legal title, lease and so on. We crunched the numbers and once we’d decided there was a deal to be done we quickly put forward an initial offer for full asking price in order to secure the deal and deter any competition. We then spent nearly £1,000 on structural surveys. It turned out this was the best return on investment ever as we managed to get around £25,000 off the asking price using the power of the building surveyor!

Our ‘edge’ in this deal was that we realised that with some simple layout changes, we could create 4 x 2 bedroom flats which would significantly increase the value and the rental yield. We also discovered that many of the structural issues could be corrected without the use of expensive underpinning which could cut our renovation bill. In addition, we loved the location of the building in an up and coming area of Manchester - Stretford. We knew it was the cheapest £ per sq ft building in the area, even taking into account the work that needed doing.

The main works involved carefully propping the upper floors before removing the entire front wall of the building (see picture), repouring a much deeper foundation and then rebuilding the front wall in block and brick to properly support the rest of the building. Although this looked drastic (and was pretty terrifying), it was badly needed as our surveyor told us that the building would have probably fallen down within 5 years unless it was corrected!

Pro Tip - When you remove the front wall of a building, don’t forget that you need to instruct a security firm to come along and make the building secure until you build the new front wall.

Yep, definitely don’t forget to do that.

With the building stripped bare, we took the opportunity to significantly improve the layout. Chimney breasts and some of the internal walls were removed to create more space. We also changed the position of some of the doors and windows to create bigger, airier rooms. Sound insulation, fire protection and thermal insulation were also upgraded to exceed modern standards and future proof the development.

This allowed us to create 4 lovely 2 bedroom apartments that all ended up being rented out for £100 per month more than the surveyors valuation. As you can see from the figures we had £100,000 in equity once we’d finished the project, and because the market has been strong that has since risen to over £200,000 today.

It had planning permission for five apartments already and so after crunching our numbers we agreed a sale price on the 4th January and completed the deal on the 4th February, exactly a month later, which with a project of this size was no mean feat!

Our ‘edge’ in this deal was that Tom had found out about a grant that was available from Salford City Council at the time for £10,000 per apartment, so £50,000 total with no strings attached! Well, the only string attached was that we had to complete the project (apart from snagging) by the end of the financial year at the start of April! Although that added real time pressure in another way it helped us to focus on achieving the goal and kept things moving because we knew we had a hard deadline to hit.

It wasn’t plain sailing either, we had problems with our main contractor. They were a big company who had many projects on at the same time, and ours was the smallest, the runt of the litter. As a result we were assigned people who were’ ‘left over’ from other sites. During the fairly short project we had three different forepeople for example, and they were changed overnight and without our knowledge or consent.