Investing in an ‘Ugly Duckling’

Investing in an ‘Ugly Duckling’

Make Money By Investing In an Ugly duckling

I  have just purchased a four-bed end of terrace house for £148k and it is a real ugly duckling.  It is not really even below market value especially considering the problems this property has.  As ducklings go, this little baby has more problems than most.  Not only does it look awful but also it has the following problems

  • Timber rot
  • Asbestos in the Cellar
  • The whole house needs underpinning to make the cellar useable
  • The bricks have been repointed with the wrong cement requiring it all to be taken out and done properly
  • It is full of rubbish
  • It has cracks in the brickwork
  • The Garage is falling down
  • The gutters need replacing
  • Half the windows need replacing
  • Very limited street parking
  • It has damp
  • It has structural issues and needs some steel work
  • The lead water main need replacing
  • The skylight needs repairing
  • Needs a complete rewire
  • The Boiler needs replacing
  • New Central heating system

On top of that, the whole place needs completely modernising, plastering, and we are going to need to take it back to brick.  In fact, it would be cheaper if we could knock it down and rebuild it.

It would be easier to knock this ugly duckling down and start again!

Showing it to ‘non-property’ people I have had some strong reactions, and not of a positive nature!

I have applied for planning permission and if this is approved this should provide the ability to provide 8 en-suite rooms a kitchen and a lounge.  This will produce an annual revenue of £47,000 and taking into account voids, maintenance, utilities, and finance cost it will produce a profit of over £20,000 a year.  Suddenly this ugly duckling is looking like a swan and maybe I’m not going senile after all.  Of

Of course, I have a backup if this is not approved.  A 6 bed HMO which I could do under permitted development rights without planning would need significantly less refurbishment budget but an 8-bed scheme allows me to recycle the cash quicker

The best thing is that, from an investor point of view, I can get all the cash I put into this back out within 18 months so the 8 bed is the preferred option.

I will be sharing the progress of this over the next 6 months so keep an eye out on my blog for updates!

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