Mersey Street, Longridge, Preston PR3 3WE

6 bed HMO , Longridge, Preston PR3 3WE

Project:

A 3 bedroom terraced property ideally suited for conversion into a 6 bedroom house of multiple occupancy (HMO) and leased to a Registered Provider on a long-term commercial lease.

A Registered Provider (RP) has expressed interest in this property, and it has passed their postcode checks.
The RP have offered a 5 year lease on this unit, following renovation and having onboarded the property.

Deal requires cash or bridge for the front-end purchase due to the scope of works.
Vendor requires an upfront 3% reservation fee, deductible from the purchase price and an Exchange of Contracts in 6 weeks.

Located close to the centre of town, with an abundance of local amenities and facilities, a short distance to the train station and motorway networks providing access to Blackpool, Manchester and beyond, Preston is well located.

The property is perfectly positioned for access into the town, is in close proximity to many local, national and global employers, and benefits from a variety of local recreation spots including local golf courses, parks and forests.

Moderate scope of works with internal reconfiguration, including.

  • Full rip out (including kitchen)
  • Remove 2.5m brick wall
  • Install 14m of new stud walling to create new rooms
  • Create 1 doorway openings in brick
  • Add new boiler
  • Add new circuits where required and replace consumer unit
  • First fix for 2 new radiators in new rooms
  • First fix for new shower room
  • Plasterboard and skim new studwork
  • Install new kitchen
  • Install new two shower rooms
  • Install 9 new fire doors and required mouldings
  • Install 2 new rads
  • Paint throughout
  • 2nd Fix all new electrical
  • Fit carpets and flooring throughout

Acquisition Costs

Purchase Price
Sale agreed
£160,000
Renovation
Refurbishment & Conversion Costs
£55,000
Architect
Budget for plans drafting plans and submission to local authority
£700
Building Control
Estimated cost for sign-off from C3 to C4
£700
Furniture
Furnishing to provider’s requirements
£5,000
SDLT
Stamp Duty Land Tax
£8,500
Survey
RICS Level 2 report
£600
Legals
Conveyancing & transaction fees & disbursements
£2,500
Insurance
Buildings Insurance
£550
Sourcing
Sourcing Fee
£9,250
Capital In
Total acquisition costs
£242,800

Rental Income (Term: 10-Year Lease)

Rooms6
Average Rate/Wk£0
Gross Rent p.a.
Negotiated rate for area
£25,194
Operational Expenses p.a.
@0.00%
£0
Mortgage p.a.
@6.00% lending
@.75%LTV
£8,910
Net Cash Flow p.a.
Pre-tax income
£16,284
Rent/m
(rm rate reverse calc)
£0
Term
(years)
10

Returns

Equity Invested£104,300
Net Cash Flow PA
Private finance investor partner net income
£16,284
Contract Lifetime Net Cash Flow
Private finance investor partner net income over the life of lease term (10 years)
£162,840

Rental Income (Term: 10-Year Lease)

Yield

11.51%

Cash-on-Cash UK

15.61%

Acquisition Costs

Purchase Price
Sale agreed
£160,000
Renovation
Refurbishment & Conversion Costs
£55,000
Architect
Budget for plans drafting plans and submission to local authority
£700
Building Control
Estimated cost for sign-off from C3 to C4
£700
Furniture
Furnishing to provider’s requirements
£5,000
SDLT
Stamp Duty Land Tax
£11,900
Survey
RICS Level 2 report
£600
Legals
Conveyancing & transaction fees & disbursements
£2,500
Insurance
Buildings Insurance
£550
Sourcing
Sourcing Fee
£9,250
Capital In
Total acquisition costs
£242,800

Rental Income (Term: 10-Year Lease)

Rooms6
Average Rate/Wk£0
Gross Rent p.a.
Negotiated rate for area
£25,194
Operational Expenses p.a.
@0.00%
£0
Mortgage p.a.
@6.00% lending
@.75%LTV
£8,910
Net Cash Flow p.a.
Pre-tax income
£16,284
Rent/m
(rm rate reverse calc)
£0
Term
(years)
10

Returns

Equity Invested£104,300
Net Cash Flow PA
Private finance investor partner net income
£16,284
Contract Lifetime Net Cash Flow
Private finance investor partner net income over the life of lease term (10 years)
£162,840

Rental Income (Term: 10-Year Lease)

Yield

11.51%

Cash-on-Cash UK

15.61%

This deal is available under our standard terms with a 25% downpayment of the Sourcing Fee paid to secure the opportunity, deductible from the final balance due at Exchange of contracts.

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