Auctions offer a huge variety of properties for sale – but some of them can come with problems.
Problematic properties offer an opportunity for you to fix the problems and potentially make a profit – but you always have to balance the risk to reward.
If you’re looking for a challenge and want to try and make a few bucks, here are some properties which may have profit potential.
But remember: Do thorough research before you bid.
Guide: £280k (By order of the mortgagees in possession)
This substantial Grade II listed six bedroom detached property backs on to the River Frome and is located within easy reach of the A419 with the nearest station at Stonehouse. The catalogue entry states “There are signs of structural movement which may require further investigation and there is a history of flooding”. This may explain why the property has languished on the private treaty market with an asking price of £375k with no takers. That’s quite a price cut given £500k was paid for this property on 25 Aug 2006. But now – with almost another £100k off – it’s being sold at auction with a guide of £280k.
Internally, the property seems to be in reasonable condition – although the structure will need checking out by a specialist. The history of flooding will definitely need to be investigated further to ensure you can get insurance as this may affect your chances of raising finance on the property.
Guide: £25k (By order of the mortgagees in possession)
Personally, I’d be feeling sick as a dog if a new-build property I bought in Sept 2009 for £106,780 was now being guided at just £25k at auction. So what do you get? Well, it’s a two bedroom, fourth floor flat in a modern, purpose built block. It’s centrally located and rental looks to be around £600pcm with comparables selling around the £65k mark. Rather tellingly, there’s something amiss here as the auction details state: ” We understand there are issues with the building, interested parties are advised to refer to the legal documents” which means you really do need to get a solicitor to check before you buy.
Guide: £60k (By order of the mortgagees in possession)
Carving up a property into smaller units can do wonders for your rental returns, but when it comes to re-sale it’s not always the easiest property to sell. This semi-detached property which has been converted into two properties, looks to be an ideal candidate for re-instatement as one. On paper it looks like the property could make a decent size 3-4 bedroom house and comparables in the area put it in the region of £120k+. That means, depending on your finish, you may be able to turn a few quid here. Personally, I can’t help thinking the front door needs to go back in the centre of the house!
Guide: £10k (By order of the mortgagees in possession)
You can’t buy much property for £10k – so I was surprised to see this one bed flat is a spacious 47 sqm – plus it even comes with a garage! As expected, the property requires refurbishment – and the description “provision for kitchen” indicates there probably isn’t one! The lease is low with around 59 years remaining, which means you’re going to need to budget for an extension. I haven’t been to Tividale, but even I’m surprised at the whopping price drop – this property was bought in 2003 for £39,950 – although the decreasing lease will play havoc with values. Re-sale values seem to be around the £30-35k mark, but with an anticipated rental of £325 pcm this could make for a sizzling yield.
Happy hunting – but remember to always do your homework and ask any questions before you bid!
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