Flat 23, Bridgehouse Court, 109-115 Blackfriars Road, London, SE1 8HW
Refurbishment Case Study
Here at base, we are experienced at property refurbishment and interior design. Read our refurbishment case study of how we redeveloped this London apartment to produce returns for the vendor of £129,720 for an investment of just £16,000.
Set within a small, private mixed-use development was this 2 bedroom, 1 bathroom apartment spread over 2 floors. Originally built in 1990 the property had not been updated at all during this time. There was a good space to work with, including a separate living room and kitchen however the owner did not want any structural alterations to the property. The head-lease for the development at the time also did not permit the installation of wood/laminate flooring.
Having eventually decided to sell the property the Vendor put the property on the market for £300,000 with no works carried out in September 2004. The property sat on the market for 2 months receiving few offers due to the poor decorative condition. The best offer received was £275,000. As this SE1 property needed major works, either to maximise its rental or to produce a beautiful central home, no one was prepared to pay a high asking price.
Having advised the owner not to sell from the start, we finally convinced him to re-assess his property decision. On review, we discovered that the decision to sell was based on minor financial needs, and did not require the sale of the property. We compiled a detailed quote which would involve gutting the entire property, refurbishing, decorating and furnishing. We also gave guide appraisals for sales and rentals values once the works were complete. The owner then consulted various Financial Advisors and Accountants and decided, wisely, to finance the property. He was quickly able to release the equity required to meet his immediate financial needs and to pay for the refurbishment.
The project was a complete refurbishment including gutting and emptying the property, designing supplying and installing a new kitchen & bathroom, new flooring throughout, re-decoration and complete furnishing, including appliances, ready for a Tenant. The aim was to create a property that would achieve a rental of at least £325 pw- an uplift of over 10%. The works were scheduled to take 1 calendar month.
£16,000- this was the cost of the complete project including supplies, labour, design, and all furnishings as well as disposal of all rubbish and with the property presented ready to occupy.
The project was completed on time and within budget. We also exceeded our investment return targets as follows:
- Rented 2005: £360 pw- increase of £70 pw or £3640 pa
- Rented 2006: £360 pw- increase of £70 pw or £3640 pa
- Rented 2007: £385pw- increase of £95 pw or £4940 pa
Our target was £325 per week and we exceeded £360. Over 3 years we produced an additional rental income of £12,220. Had the vendor decided to keep the property for 1 more year the rental increase alone would have paid for the entire refurbishment project.
At the end of 2007 the vendor decided that he now wanted to sell the property. The property was placed on the market at £385,000 with a view to achieve offers in excess of £360,000. Within 48 hours of going to market we had 6 offers at Full Asking Price. Final offers were then taken and the vendor eventually sold the property for £392,500 (an offer for £400,000 was received but declined).
Therefore in 3 years the value of the property had gone from £275,000 to £392,500- a total value increase of £117,500 or 43%!