Today I was travelling in the Surrey area when suddenly a burnt out bungalow caught my eye. It was a generous sized plot in a good part of town. And…low and behold…it was For Sale!
I could not resist – I pulled over and jumped out of the car ready to explore. The bungalow had seen better days (many, many years ago) and had been ravaged by fire…
Now the sign may put many people off….
BUT NOT ME!!!
So here is the bungalow from the outside – as you can see it needs some work!
The property had been severely fire damaged:
And as you can see the property had been left for a long time – look at the undergrowth growing through the structure of the building:
The building was also supported by some make shift stilts!
Now at this point you may be wondering what on earth this fire damaged bungalow has got going for it!
So let me show you the view at the bottom of the garden and which the property directly fronts onto:
Yes – what a beautiful plot indeed!
So obviously my mind went into overdrive – I could imagine beautiful glass backed properties overlooking the River Thames, wrap around balconies, direct river moorings…ooh you could have fun.
And then I sat down to do the sums.
Now with such a building project the foundations are going to be very deep indeed – and that comes with a huge cost. I had worked out that we needed to get two detached 4 bed properties on the plot to make it worthwhile.
The plot had an asking price in excess of £500k, not such a bad price…but then I started to add up all the costs…and before you know it I realised I needed to raise a cool £1 million pounds of hard cash. I know – it’s a lot of money – but to be truthful there is still money in this project – perhaps a profit of £200,000 when the project is complete. That would still give a return of 20% which is pretty respectable in development terms – especially given the project would take less than 1 year.
But, while I liked the plot and I had ideas of what could be done. I just didn’t get “that” feeling. I don’t know how to explain it – it ticks all the boxes – great location, desirable USP, good profit and return…but I still felt a “but”. And all I can tell you was that it wasn’t for me – this project just didn’t do it for me.
And that’s what property development is all about – it’s not always just about the numbers and the profit – you have to enjoy what you do and you have to have complete belief in it. And this, for me, just isn’t “it”.