4 bed HMO , Collin Road, Preston
Project:
Background & Deal Structure:
A 3 bedroom semi-detached property requiring modernisation, ideally suited for conversion into a 4 bedroom house of multiple occupancy (HMO) and leased to a Registered Provider on a long-term commercial lease.
We have an established relationship with a Registered Provider (RP) who expressed interest in this property, after passing all their criteria checks.
The RP offered a 10 year lease on this unit, following renovation and having onboarded the property.
Area / Location
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 Liverpool, Chester and beyond, Birkenhead 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.
Scope of Work
- Structural – knock-through lounge to make up space kitchen/diner and bedroom
- Rewire + smokes
- Boiler and 3 radiators
- Fire doors x 5
- Plaster
- Decor
- Flooring
- Kitchen – strip light + oven switch
- Bathroom first floor – path panel + fan
- Bathroom Ground – replace shower tray
- Rip gas fire/make good
- Clean up DG frames and replace handles
- Board loft hatch
- Replace yard panels x 5
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Video Walkthrough:
UK Financials:
Acquisition Costs
| Purchase Price Sale agreed | £197,600 |
| Renovation Refurbishment & Conversion Costs | £0 |
| Project Management @10% of cost of works | £0 |
| Architect/Planning Technical drawings for approval by HMO officer | £0 |
| Building Control UK | £0 |
| Furniture Furnishing to provider’s requirements | £0 |
| SDLT:Resi Stamp Duty Land Tax | £5,928 |
| Survey RICS Level 2 Report | £0 |
| Legals Conveyancing & transaction fees & disbursements | £2,500 |
| Insurance | £400 |
| Sourcing Sourcing Fee | 0 |
| Equity Invested Total acquisition costs excluding finance | £206,428 |
Rental Income (Term: 10-Year Lease)
| Rooms | 4 |
| Average Rate/Wk | £80.75 |
| Gross Rent p.a. Negotiated rate for area | £16,796 |
| Operational Expenses p.a. @0.00% | £0 |
| Management p.a. 0.00% | £0 |
| Net Cash Flow p.a. Pre-tax income | £16,796 |
| Rent/m (rm rate reverse calc) | £1213.333 |
| Term (years) | 10 |
Returns
| Equity Invested | £206,428 |
| Net Cash Flow PA Private finance investor partner net income | £16,796 |
| Contract Lifetime Net Cash Flow Private finance investor partner net income over the life of lease term (10 years) | £167,960 |
Rental Income (Term: 10-Year Lease)
Yield
Cash-on-Cash UK
International Financials:
Acquisition Costs
| Purchase Price Sale agreed | £197.600 |
| Renovation Refurbishment & Conversion Costs | £0 |
| Project Management @10% of cost of works | £0 |
| Architect/Planning Technical drawings for approval by HMO officer | £0 |
| Building Control | £0 |
| Furniture Furnishing to provider’s requirements | £0 |
| SDLT:Resi Stamp Duty Land Tax | £9,880 |
| Survey RICS Level 2 report | £2,500 |
| Legals Conveyancing & transaction fees & disbursements | £400 |
| Insurance | £0 |
| Sourcing Sourcing Fee | £0 |
| Lease Setup | £0 |
| Lending & Brokerage Fees | £0 |
| Equity Invested Total acquisition costs excluding finance | £210,380 |
Rental Income (Term: 10-Year Lease)
| Rooms | 4 |
| Average Rate/Wk | £80.75 |
| Gross Rent p.a. Negotiated rate for area | £16,796 |
| Operational Expenses p.a. @0.00% | £0 |
| Management p.a. 0.00% | £0 |
| Net Cash Flow p.a. Pre-tax income | £16,796 |
Returns
| Equity Invested | £210,380 |
| Net Cash Flow PA Private finance investor partner net income | £16.796 |
| Contract Lifetime Net Cash Flow Private finance investor partner net income over the life of lease term (10 years) | £167,960 |
Rental Income (Term: 10-Year Lease)
Yield
Cash-on-Cash International
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