Archive | April, 2013

Why You MUST Check The Leasehold Details Of Auction Properties

14 Apr

At first glance, this top floor one bedroom leasehold flat in Catford, London with a guide price of just £65k looks a steal.

catford flat for sale

Comparable properties in the area are on the market in the region of £125k and the rental is around £750 pcm – which, if bought anywhere close to the guide price, could produce a whopping rental yield – plus the chance of some decent capital return.

However, this is an auction leasehold purchase.

And that means you need to do your homework very carefully.

So I had circled this flat as a “go-and-see” once I had checked the legals.  I know on Homes Under the Hammer you see an incredible array of people buying properties at auction without even seeing the property they’ve shelled out for, let alone taking the time to read the associated boring bits of legal paperwork which go with the property – but for me, it is the FIRST thing I do.

Without the legal paperwork I have no interest in viewing a property.

So the legals have been uploaded and they make for interesting reading – well, interesting in so far as, I am pleased I didn’t spend any time in going and viewing this property.

Firstly – the long leasehold property which I thought this was and as is detailed in the catalogue entry:

“Held on a lease for a term of 999 years from 1/1/2004 at a ground rent to be advised”

Actually refers to the leasehold of the entire building and NOT the lease for the actual flat which is being sold.  As a matter of fact, the flat which is being sold, has a very short lease – just 58 years remaining.  Which, if you’re thinking to raise finance on this property, will be an issue with many lenders.

Fortunately, it would appear the vendors have managed to obtain a voluntary agreement for the lease extension costs – which is a premium of £15k and a ground rent of £200 per annum (doubling every 20 years).  Although, you still need to add all the other associated costs of this lease extension to that premium – which will include paying for the vendor’s legal fees (pre-agreed at £995), and of course, paying for your own.

If you disagree with the premium proposed and would prefer to go down the statutory procedure route and serve Notice then you may as well stick your finger in the air for how high the fees could escalate – for by the time you add in valuers fees, LVT costs and additional solicitors fees – for both the landlord and you, I am unsure if it is even worth arguing the toss about.  And the fact is – the flat only has 58 years left – and the shorter the lease gets, the more it’s going to cost you anyway.  And the statutory procedure for serving Notice is not a quick route – especially when you take into account that you will have to own the flat for 2 years before you can apply anyway.

So I was pretty taken aback by the short lease situation – because one of my reasons for selecting the flat had been the long leasehold details as mentioned in the catalogue.  However, with any auction purchase it is down to the buyer to do their own due diligence beforehand.  The auctioneer cannot be held responsible for any inaccurate particulars when a prudent buyer is expected to read the paperwork to a property.

And in all honesty, I feel that’s the least a prudent buyer should do before they part with several thousands of pounds.

Anyway, I pondered that maybe the flat was still worth a punt and so I calculated the additional £15k for the premium and allowed another £3k for solicitors.

And then I got to the service charge information sheet.

Well, that was a shocker.

The estimated service charge this year is £6159. 

Eek!!

This one bed flat is getting mighty pricey when you check the associated bits of paper.

So I looked into why the service charge was so high and I discovered the roof is about to be replaced and thus a major chunk of the service charge cost is to be held in the “reserve fund” to pay for these costs.

And then I pondered on the whole issue of “reserve funds” when it comes to service charges – I realised that with a period building of this size and nature the “reserve fund” contribution could easily end up being a recurring annual event.  And I decided that unlike Christmas and Birthdays I didn’t fancy an annual celebration of owning this flat – it could end up costing far more than both my Christmases and Birthdays combined!

Oh Mother, Well WTF Happened To My Roof And My Windows???

10 Apr

I swear to God this is what the buyer said when they saw the flat they bought at auction.

Just look at it:

motherwell

 

Now I have never been to Motherwell – which is a suburb on the outskirts of Glasgow – but let me tell you even WITHOUT a roof and windows a 3 bedroom flat with a guide price of just £2,500 has got to be F**KING AWFUL – which is the complete opposite to my favourite word of the month: AWESOME.

Which this flat clearly is not.  And neither, do I believe, is the place.

Motherwell, although I have never visited it, I believe is a hole.  And if it’s not a hole, it should be in a hole.  And then it should be covered up very rapidly by some incredibly industrious badgers who like covering holes.  That’s the sort of hole I think it is.  Although – a covered hole would be the preferred option.  By the aforementioned badgers.

I tried to go on google maps and streetview Motherwell.  But it hurt Google’s eyes.  And my laptop refused to talk to me.

And then I used my iPhone.  Which turned itself off.  Which isn’t surprising – it is an iPhone.

And now I have pondered some more on my spurious assertions about this roofless, windowless 3 bed flat with a guide price of £2.5k in a place which I have never visited, but nevertheless believe should be covered in a hole, very deftly and very quickly.  By badgers.

And then I wondered if I was being unkind, because I found a former photograph from some sort of hidden archive (the secret love society of Motherwell) which shows the flat with windows and a roof.  Although, it has to be said: it is still in Motherwell.

 

motherwell1

 

But I guess that was them *halcyon* days where everything was just plain peachy.  And everyone was high.  That was before the trees refused to grow.  And even the badgers didn’t want to dig: they were probably too high.

And it occurs to me that in all my revelry of Motherwell I still know nothing more.

And so I bribe Mr Google to work for me.  I stroke his googley legs and arms very seductively.  Lustfully, even.  And he spits out the following with a disgusted electro-burp and I feel vindicated.  Even if it is virtual.

Because here is the living proof – word-for-word from someone who had the misfortune to live in Motherwell.  But they made it out alive.

Before the badgers moved in.

“Motherwell, what a sh*thole

I had the misfortune to live in motherwell during my formative teen years, and also met my now ex-wife there (so i suppose i am slightly biased).

motherwell is between hamilton and bellshill, and seems to attract most of the pond life from there and other sattelite towns so they can congregate in “strathy park”. now dont let the “park” bit of the description mislead you, most of the green space is used up by dead tramps, used needles and empty buckfast (or fu*k fast) bottles, and as such i would not recommend taking the kids down for a picnic.

if you manage to treck through thie no-mans land inhabited by gold wearing saliva dripping monkeys without getting mugged/stabbed/infected/leg humped, you will come across an “amusement park” (i use the term very loosely) which is a mecca to the pram pushing chavettes, all looking for the father of their offspring (as most of them were concieved in the adjacent car park). they remind me of salmon, returning to the place of their birth to spawn more little snotty nosed primark clothed under nourished (fruit pastells are not part of your five a day)little darlings.

to be fair, its not the kids fault…..when your main role model is “anna marie, fae the moerwell young crew” who loves nothing more than letting drugged up chavs sh*ag them, then knock them about, and whos main highlight is nothing more than to skip to the local asian corner shop on giro day, and buy as many richmond fags and buckfast as her “brew” will allow.

so all in all, avoid motherwell, in fact, avoid lanarkshire, in fact (and as a scotsman i say this with a heavy heart) avoid the south of scotland all together”

Quoted in entirety from: Chavtowns

 

How I Sold My Property Myself With Hatched The Online Estate Agents

5 Apr

At long last the property I saw and bought in less than 3 hours and refurbished in just 18 days has sold!

This afternoon the solicitors have done their various bits of important paper-shuffling and DX mailbox malarky and contracts have exchanged!

So, this epic saga is now drawing to a close.

And I know this “adventure” seems to have dragged on for far longer than what anybody ever thought it would do, or should do.  But, in all honesty, I guess this whole story kind of encapsulates what it is REALLY like when you buy, refurbish and sell a property.

I know there have been many of you who doubted whether this sale would actually happen – and I too have also wondered at times, whether a sale would happen or if it would end up with me renting the property instead.

However – it has happened!  So there is hope – take heart in my story (no matter how long this seems to have spun on for!)

And also rejoice in the fact that I have proven estate agents do NOT have magical powers when it comes to selling property!

The battle of the estate agents: online estate agents Vs. High Street estate agents has been fought and Hatched the online estate agent have won several times over – not least because they have now sold my property, but also because they sold it the time before that as well!

And let us not forget the sort of escapades Hatched have had to put up with: who will ever forget the Hungarian Adventure in Tesco’s Cafe!!

And let us also not forget Hatched got me FULL ASKING PRICEl

And all of this wonderfulness which Hatched tirelessly sought to achieve, kind of makes me feel a bit guilty.

Because I do have a *little* secret to share….

Because if I am completely honest with you…

There were times when I doubted the Hatched process.

Given the pittance I was paying them to sell my property, I couldn’t help but think to myself on occasion “This is too good to be true…” and we all know how that sentence ends.

And so I have always felt a little hesitant that once the process got more involved, and a bit more like proper estate agency work and less like advertising on Rightmove, that maybe, just maybe, the whole process could potentially fall apart.

And I have to admit, hand on heart – that is where Hatched really came into their own.  Surprisingly so.  And they are PROPER estate agents: they just happen to be online!

At times I have even felt positively over-whelmed by the amount of update emails and phone calls from Olivia & Joe at Hatched.  At every step of the way they knew what was happening and they made sure I knew what was happening.

And to cap it all off, not only was the service top notch – but selling my house with Hatched cost just £477.60 – a whopping saving of £3266.40 against the high street estate agent.

For that I believe Hatched deserve an AWESOME award!

hatched.co.uk

 

How To Design The Cover Of A (Hoped-To-Be) Best Selling Property Book?

4 Apr

Amazingly enough the AWESOMENESS continues:

The completed book manuscript has been pinged over to the publishers and I am now settling down to write the book cover blurb and try and answer a whole range of deftly crafted questions from the publicity team…

But one question has me stuck – and that dear reader, is where I am turning to you for assistance.

So, my publisher has told me the book cover is ESSENTIAL to making a sale.  They are going to be briefing their cover design team in two weeks and they asked if I had any ideas for how I wanted the book cover design to be.

Straight away I whooped “Yes”.

But, when I thought about it and I realised I have no idea what the book cover design should be like.  And, in actual fact, I know nothing about book cover designs.

Which is where I need your help!

The conventional cover design for a book on how to buy property at auction would probably have some sort of reference to property and auctions – probably in the form of a gavel or a house, or property of some description.  And maybe it HAS to be that simple.  But somehow it just feels a bit *meh*.  Or am I wrong?

The fact is the book cover design has less than 10 seconds to make an impact with the buyer.

Of course, if you’re not thinking about buying property at auction, then you probably won’t be looking at my book.  But, if you were looking for a book on property and you happened to then see a book about buying property at auction how could I tempt you to look more?

Apart from the words – what is it about the cover design which will tempt you to add my book to your shopping basket?

Having visited Waterstones, I’ve realised, it’s actually online bookstores like Amazon which are going to be the key sellers and distributors of my book.

Which means the cover design needs to stand out from the SCREEN rather than the shelf.

So I decided to do some research on Amazon and look for the number one selling book in property, which is this:

successful property letting

Admittedly, it’s a book on “Successful Property Letting: How to make money in Buy-to-Let”, which could arguably have a wider audience – however many great buy-to-let bargains can be bought at auction (plus lots of great property development deals) so I feel this book is a good comparison.

But, still when I look at this book cover design I do not feel inspired: I do not feel like “Yes, I MUST buy this book”.

And, that is where I am struggling – maybe I am too close to this, maybe I should just write and let the designers design.

But then I thought to myself – I wonder what my readers think?  I wonder what they would like to see for the book cover design, I wonder what ideas they may come up with?

And as a picture is a worth a 1000 words I have started a Pinterest board on the very subject of this book cover design and I would love for you to add your pins/ images/ ideas/ comments.

Feel free to share and add ideas –  I would love to hear how you think the book cover design should look!

The property auction book cover design board is here