Richard Tugwell

Why 'fixer-uppers' could offer value for property investor clients




I was reading an interesting piece of recent research which cited poorly maintained properties as one of the problems most likely to put homebuyers off a purchase.

You may think this is fair enough. They don’t really want to be kept awake in their new house by worries about the roof caving in. But it’s exactly these kinds of ‘fixer-uppers’ that could prove a great opportunity for brokers’ clients who are looking to make good returns on a residential, commercial or semi-commercial investment property.

It seems that distinguished but dilapidated properties, in prime London hotspots as well as other areas of the country, are seeing a resurgence in popularity. 

They may have been in the same family for generations and could have risen in value considerably since they were first bought, so those selling may be keen to strike a deal.

Unfortunately, some lenders won’t even consider providing finance for properties which may be defective or have had poor remarks on valuation reports. At Together, we will consider all types of properties, regardless of their structure, age or valuation, using manual underwriters to look at each case on its merits.

We provide development finance for larger projects and bridging finance up to £5m in short timescales, meaning the investor will be able to buy the property, do it up and use its sale to exit the loan. This is also available on commercial or semi-commercial properties, meaning investor clients will be able to buy the property with the loan, do the work needed to bring it up to scratch and use its sale as their exit strategy.

At the auctions we attend across the country, we see anything from maisonettes which have seen better days to crumbling castles. Before doing the work, clients will have to look into planning permissions and restrictive covenants, but even more modest projects – such as replacing a bathroom or a kitchen – could prove a savvy investment, and lenders like Together can help to provide the finance needed to achieve their property regeneration goals.

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