This buy to let opportunity has a few options for development but will the location on a busy crossroads on Southbury Road put people off?
Four bedroom house for the bargain price of £250,000 (Oh and just a little bit of work!!!)
On Saturday I went to look at a property that goes under the hammer today - Monday 15 September. Located on Southbury Road EN3 with four bedrooms, three reception rooms a bathroom, shower room and rear garden, it was described in the auction catalogue as being ‘in need of modernisation’ (a very vague expression!!)
However, being just 10 minutes drive from my own home, I was intrigued by the possibility of buying a four bedroom house for just £250,000.
There was definitely good and bad about this house.
The good – It’s huge! The downstairs has been extended and seems to go on and on and on, from sitting room to dining room to morning room to kitchen and finally to shower room. Upstairs there are three double bedrooms, one single and a family bathroom. To the rear there is a good size 60ft hard paved garden, and the roof looks to be in good condition.
The size of this property is definitely the main attraction however also of interest are some of the remaining original features, including
fireplace tiles (not sure if the fireplaces are open), ceiling roses and coving.
However, there’s always a downside…..
The bad – Previously split (not very well) into two flats with a front reception that doesn’t seem to belong to either flat, this property needs a lot of work. There’s a general facelift required throughout to drag it into the 21st Century and there’s some evidence of damp downstairs, however the main area of concern is the rear ground floor, specifically the kitchen and shower room which would need completely ripping out and starting again.
Upstairs is mainly cosmetic although some re-plastering is likely as the woodchip wallpaper looks like it has been there for many years. The kitchen upstairs has already been removed so there’s some tidying up required to hide the evidence of units and appliances, remove wall tiles and turn it back into a bedroom. While there is GCH in the house there don't seem to be many radiators and the double glazing also need some attention.
A lot of work but nothing impossible. Unfortunately the real downside of this property is the location. Yes it’s great for Tesco’s and Southbury train station but for me, it’s just too close to the busy Southbury Road and Hertford Road interchange.
Looking at it from a purely investment point of view though this house may have some potential. Once renovated, I can imagine this as a beautiful family home with an abundance of living space.
Recently, four bedroom houses within a quarter of a mile of here, have been on the market for rental at £1,700pcm and more. However, the location will work against this property so I think a more realistic target would be £1,600 - £1,650pcm, which incidentally, is less than the LHA rate for 4 bedroom houses in Enfield. Depending on who your target market is, that could be a key decision factor for you.
Does it stack up financially? Well at a very top level yes it does. Assuming a price of £250,000, a renovation cost of £20,000 and monthly rent of £1,600, you could achieve a gross yield of 7.7%.
And that’s just one option, if you were to look at renting to sharers or converting the property into flats and renting them out separately then you could potentially see an even better return on your investment.
It will be interesting to see what happens later on at the auction and indeed what the next owner decides to do with the property!
** UPDATE POST AUCTION **
This property was sold at auction for £316,000. That's £66,000 over the guide price. I can't wait to see what happens next!!