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Your capital is at risk and investments are not covered by the Financial Services Compensation Scheme (FSCS).

Buy-to-let

South Norwood London SE25

3 Year Buy to Let

£1,000 Raised
£217,600 Total
3 Investors
14.9% Projected Growth
0% Below Market Value
 
Overview

Property Features:
  • Private terrace
  • On street/residents parking
  • Central heating
  • Double glazing
  • 2 Bedroom Lower Ground Floor Flat
  • Lounge
  • Fitted Kitchen
  • Bathroom
Spacious two bedroom lower ground floor flat, located on South Norwood High Street, just 2 minutes away from Norwood Junction train station with excellent links to central London. The flat consists of a spacious lounge, two good sized bedrooms, fitted kitchen, bathroom and a private patio garden.

Measurements (Approx):

Lounge: 21'5" x 12'7" (6.53m x 3.84m)

Kitchen: 12'7" x 7'6" (3.84m x 2.29m)

Bedroom One: 12'7" x 9'5" (3.84m x 2.87m)

Bedroom Two: 16'0" x 10'11" (4.88m x 3.33m)

Bathroom: 8'10" x 6'10" (2.69m x 2.08m)


The property will be purchased with the current tenants, let on an AST since 6/12/2017 for £1100 pcm. Therefore investors shall start receiving rental income immediately after legal formalities are completed.

The current lease is approx. 67 years remaining, and we will apply for an additional 90-year extension, under the 1993 Leasehold Reform Act. 
This will potentially add value* and increase the saleability of the property on exit.

There is also a possibility of easily creating an additional bedroom (to make it into a 3 bedroom flat) as well as upgrading the property before sale in the future. The projected sale price is not based on this. 

The property was previously sold for £170,000 at auction on 14/7/2017.

*https://www.moneysavingexpert.com/mortgages/extend-your-lease/  


Why South Norwood?

Explaining why the area has become something of a property hot spot over the past few years, a spokesman for Townends estate agents said: "South Norwood is a popular location for families, first-time buyers and commuters, which means there is a fantastic mix of individuals who make up the vibrant local community.

"It's still one of the best value-for-money locations in the South East of England, and it's attractive to buyers as there are many excellent transport options in the area."  (source: Croydon Advertiser)


Also, the property is only a 10-minute drive to the proposed £1.4 bn Westfield Centre in Croydon, which will massively transform Croydon town centre. We are also expecting local property prices to rise significantly.
Purchase Costs  
Purchase price  £176000
Acquisition costs (*)  £29802
Contingency fund  £1500
PTC listing fee (5%)  £10298

Total fundraise
  £
217600

(*) Acquisition Costs
 
Stamp duty £6300
Legal Fees £ 1300
Survey/Valuation Fees £ 300
Accountancy Fees £ 700
Photography/floor plans £ 200
Lease extension £ 18352
Professional fees (lease extension) £ 2500
SPV set-up £ 150 

Total acquisition costs
£
29802 



Projected Sale Proceeds
 

Sale price £235,000
Rental income 3 years £39,600
Total £274600

Costs
Cost of purchase  £217600
Agent’s Management fee  £4,320
Agent’s commission (sale)  £4,230
Accountancy fee (years 2 & 3)  £1,400
Total Costs  £227550
Company tax  £8940
Projected net gain on sale £38111
PTC exit fee £5717
Net profit to shareholders £32394
Projected net ROI (3 years) 14.9

Projected NET return on investment (ROI) –  14.9%



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