104 Faraday Road
A 4 bed student HMO in Nottingham, JV investment
An opportunity arose to buy a struggling property in a good student area of Nottingham. Property was let and provided income to service the initial buy to let mortgage whilst refurbishment was planned.
We invested £109k, renovated the property within a year, and refinanced it. Renovation was done in 4 weeks during summer.
After refinancing, investors received back £75k of the initial investment plus 8% annual interest. The rest of the investment was repaid next with the same interest. The property is now stabilised, rented out well, and the investor's money was fully returned and reinvested in other projects.
Key information
Purchase Price - £225k
Refurb Budget - £50k
Total capital investment - £109k including purchase and refurbishment
75% BTL mortgage
Yield at purchase 8%
Number of beds at purchase - 4
Number of beds post refurb - 4
Post refurb valuation - £335k
Equity released - £75k (paid back to investor after 12 months with interest)
Gross Revenue post refurb, including bills - £54k
Post refurb Gross Yield - 9.4%
Gross Yield on remaining capital employed - 94%
If you would like to understand more about any of my experience please contact me.
