Refurbishing an unlettable property

For all you property buffs out there, you’ll know it’s a real shame when you can see the potential of a property, but its current state means it is simply unlettable.

 

This was the case for our clients, Dean and Ben who have both been in the property market since 2004, and came together to create DAB Hand Property Developments Limited in 2020.

 

Dean and Ben located a terraced house in Stourbridge that was in need of some serious TLC, with a new kitchen, bathroom and plastering throughout all necessary. Due to the condition of the property, it couldn’t be put up for let until it had a complete refurbishment.

 

Although it was a challenge, they both have a background as tradesmen, so it was one that they were willing to take on, with a game plan in place of purchasing the property and completing a full re-vamp, meaning they could then release the equity through the increased valuation.

 

However to put the plan in motion, Dean and Ben needed to find the right funding solution for the project, and that’s where our team come in!

 

Our approach

 

When they got in touch with team signature and explained his needs, it became clear to Paul, our Senior Mortgage and Protection Adviser, that bridging finance was the best short term solution for this project, and as always, Paul made it his mission to find the most competitive rate for them.

 

A bridging loan is a popular option when it comes to meeting tight deadline on renovations as it allows you to act quickly and ‘bridge’ the financial gap. Securing this loan meant that Ben and his team could get to work on the renovations as soon as possible, meaning the quicker they could put the house up for let and see the return on investment.

 

Once this was completed, Dean and Ben were then after a specialist buy-to-let lender that would accept a pre-6 month’s refinance application but also allow him to use the new increased valuation. So, that’s exactly what Paul found for him!

 

The result?

 

With an initial purchase of £93,000, DAB spent £22,000 the refurbishment work, which included:

 

  • Roof works
  • New windows and doors
  • First and second fix electrics
  • New kitchen
  • New Bathroom
  • Plastering and painting
  • And more!

Once the above work was completed, the increased valuation came out at £165,000, with DAB Hand Property securing a mortgage loan of £123,750.

 

Including the total fees of £11,610 over both applications, the clients only left £960 in the property, and with the rental income of £800, it has worked out to be less than 2 months’ rent!

 

If you’re a part of the 1,464 of those following DAB Hand on Instagram, you may have already seen what they had to say about working with us, but if not, here was Ben’s final thoughts after his completion…

 

“We’ve just remortgaged on our most recent buy to let property in our portfolio, with the amazing help and guidance from Paul.

 

Paul arranged the bridging finance for the purchase allowing us to carry out work that needed to be done, and then once all the works were complete, he moved us onto a mortgage.

 

I would highly recommend signature. Paul’s great to work with always goes above and beyond and made the whole process stress free with his expert knowledge in the area, allowing our business model to excel at great speed. Thanks guys!”

 

Here at Signature, we’re on the journey with you. Our trusted mortgage advisors are here for you at every stage, whatever your requirements may be. If you are looking for some advice but unsure where to start, you can speak to one of our experts by getting in touch here.