October Below Market Value Property Deals

London Investment Property Deals : Below Market Value High Yield Properties

London Investment Property Deals

Dear PropVestor

With Autumn coming along there has been a slight revival of the property market, albeit not a substantial one.

Nevertheless being in touch with the right sources there is always a DEAL available for you. Here is a selection of investment deals for you, just a few we have on our books right now.

DEAL ONE: 2 x two Bed Maisonette in Enfield

Read more

PropVestment in Telegraph Property

Ex-council homes: how to buy a bargain – Telegraph

PropVestment mentioned in the Telegraph Property section: Why Council homes are a bargain

By  7:00AM BST 03 Sep 2012

A new proposal to sell off council housing in some of Britain’s best postcode areas could be a once-in-a-lifetime investment opportunity. It is no time for snobbery, says Graham Norwood.

Ex-council house in Essex

This 17th-century former hunting lodge in South Ockendon, Essex, used to be three council homes, and is today a six-bedroom house. It’s on the market through Fine (fine.co.uk) for £449,995.

It is one of the biggest property stories of the year, and an opportunity for bargain hunters like no other. When the Telegraph published an article about selling off council houses, by Neil O’Brien, the director of Policy Exchange, it had no idea what a storm it would create.

Last week’s report argued that if councils sold all the homes which become free in an average year, they could raise £4.5bn in revenue. This money would then be ploughed back into 170,000 new-build properties in cheaper parts of the country. The story provoked plenty of debate. Grant Shapps, the Minister for Housing, called the idea “blindingly obvious”. David Cameron said the proposal was “certainly something [councils] should look at”. Not everyone was happy: some Labour MPs warned that it risked creating ghettoes and ruining local diversity.

But aside from the political to-ing and fro-ing, what does it all really mean for homeowners? If cheap houses become available in some of Britain’s best areas, it could provide golden opportunities for canny investors. Certainly, it is time to end the snobbery and acknowledge the truth. Many local authority homes are fashionable, built to last and brilliantly located. For every hideous tower of cheaply built flats requiring demolition, there are spacious low-rise mansion blocks. These date from the public sector heyday of the Thirties, now considered retro-chic.

Then there are thousands of Victorian and Georgian houses, originally built for private sale. Councils bought them as part of grandiose regeneration schemes, many of which came to nothing. But a sprinkling of 21st-century TLC would return them to their former glory, or even better.

There are substantial profits to be made, as has been seen in areas where council properties have been sold in the past. Camberwell is a good example. A two-bedroom council flat bought here for £44,000 in 1994 recently sold for £214,000. During the intervening years, the area has come up in the world. Where once it was slightly grubby, it is now a fashionable village, home to the musician Florence Welch, as well as actresses Lorraine Chase and Jenny Agutter. If a new sell-off becomes policy, there may be thousands of homes coming on the market in the most desirable parts of the country. Often at bargain-basement prices.

In the London borough of Kensington and Chelsea, for instance, the average flat costs at least £967,000 and a typical semi-detached house costs more than £12.5m, according to Land Registry figures. Even in this salubrious enclave, however, a quarter of homes are categorised as social housing: owned directly by the council or through housing associations. In Brighton and Hove, there are similar opportunities. A typical detached house costs almost £461,000, and a flat will set you back £197,000. Yet one in every seven properties is in the social sector. Here and elsewhere, a sell-off would mean ex-local authority properties being marketed at prices lower than those for comparable private homes. There would be rich pickings, for those in the know.

“Even in prime condition, ex-council properties sell for 20 per cent less than a similar home next door because of the stigma,” says Geoff Tanner, a private property consultant based in Cambridgeshire. “If it is in poor condition, it could be 30 per cent less. The proposed sell-off would represent a great deal for buyers who get in quick.” Some councils are already encouraging tenants to free-up larger properties. In Devon, more than £700,000 worth of cash incentives have been paid to tenants. This has released 330 homes in areas such as Exeter, Plymouth, rural Devon and the coastal South Hams.


This one-bed, ex-council flat is in Drury Lane in Covent Garden. It is being sold for £437,000 through Chesterton Humberts.

Westminster Council, in central London, has set up CityWest Homes Residential, a service specialising in marketing council homes. Its website, cwhr.co.uk, advertises flats to rent in areas such as Bayswater and says homes for sale are “coming soon”.

With all this activity already ongoing, it’s no surprise that estate agents have greeted the prospect of a sell-off with open arms. They highlight the advantages of council-owned buildings compared with those which have been squeezed by the private market. “Council properties are often well-built with good-size rooms and communal gardens,” says Christopher Saye of Chesterton Humberts. “Red-brick period blocks don’t even look like council properties and generate plenty of interest. They are cheaper than comparable private developments, with far lower service charges.”

During the Eighties, Margaret Thatcher’s Right To Buy initiative allowed tenants to purchase their homes with a discount of up to 70 per cent, if they had lived there for two years or more. Many councils also offered 100 per cent mortgages to encourage buyers. The scheme boosted Britain’s home ownership level from 57 per cent in 1980 to 68 per cent in 2000.

But the sort of sell-off proposed by Policy Exchange would be even more dramatic. It would be an open field, with anyone entitled to buy the flats. Not just those already living in them. “It’s simply good asset management. Some local authorities do this already. We’ve sold properties in high-value areas at auction on behalf of authorities,” explains Yolande Barnes, head of research at Savills and one of Britain’s leading housing experts.

Clearly, there is no shortage of enthusiasts for the quality and good value offered in ex-local authority housing. Nirav Shah, 24, bought a three-bedroom apartment in Waterloo, central London, in 2008 when he was a student. “My father and I looked at lots of properties and none even came close to the former council flat for location, space or condition,” he explains. He now runs a property investment firm called propvestment.com. “I no longer live in the flat, but I rent it to other students. It has been let permanently since I left. Ex-council is a perfect investment,” he adds.

His apartment was one of many built to Parker Morris standards, a planning regime which until the Eighties imposed minimum sizes on public-sector architects and builders. Parker Morris stated that a one-bedroom council flat built for up to two people should have a minimum of 495 sq ft. Try finding that in a modern private flat today. The standards have even got a thumbs-up from London Mayor Boris Johnson, too. After taking office, Johnson promised to “re-establish space standards promoted by the visionary planner Sir Parker Morris”. He argued that this was the only way to “build for the long term. Buildings that people will want to keep for 100 years and not tear down in 30.” Space, location and value: the council-house dream seems almost too good to be true.

But while many are in favour of selling council homes, there are still issues to resolve. “One concern might be tenant displacement,” says Jennet Siebrits of CBRE, a consultancy advising developers and public bodies on housing. She fears new homes built with money from a sell-off would have to be in cheaper areas. “We would need careful analysis about which parts of the UK have the highest demand for social housing,” she says.

There are also concerns that moving council tenants away from their places of work could create pockets of unemployment, and ruin the mix of people which makes Britain so vibrant. Policy Exchange believes, however, that these short-term problems would be outweighed by the benefits of creating half a million new homes in three years.

So will it actually happen? With a Cabinet reshuffle imminent and a relaunch of the Coalition likely at this month’s party conferences, there is an appetite for radical initiatives. And no sector needs them more badly than housing. A boom of new construction would create homes for the needy and jobs for builders, as well as opportunities for people looking to get on the property ladder.

A social housing revolution may be just the economic shot in the arm the country wants. And for keen-eyed individuals, it could be the investment of a lifetime.

Buying an ex-council property: the pros and cons

Pros: 
Price – they usually sell at 20 per cent less than comparable private properties, says the Royal Institution of Chartered Surveyors.
Investment – ex-council houses are good for buy-to-let landlords wanting more for their money.
Location – ex-council property is often very central, perfect for transport and nightlife.

Cons:
Outside – tower blocks can look daunting from the street.
Communal areas – there can be disputes over charges and responsibilities if some flats in a block are publicly owned and others private.
Ceiling price – until the stigma dies, ex-council homes will sell at a discount compared to private homes.

Original article link http://www.telegraph.co.uk/property/9508685/Ex-council-homes-how-to-buy-a-bargain.html

OTHER MUST READS: PropVestment in Daily Mail

 

Where to invest in India: Rajkot, Gujarat

Where to invest in India: Rajkot, Gujarat

Why is Gujarat where to invest in India?

We have seen that compared to other states Gujarat under the leadership of Narendra Modi has experienced rapid double digit growth for the last few years. There are no signs of slowing down either with many new investments in infrastructure underway. The investment opportunities for NRI’s are huge, you just need to know where to invest in India.

Gujarat experienced 11% growth for 2011, higher than China

 Why is Rajkot where to invest in Gujarat

Where to invest in India: Rajkot, GujaratRajkot is the capital of the Saurashtra region of Gujarat and the 4th largest city of Gujarat.

Rajkot is ranked 22nd in The world’s fastest growing cities and urban areas from 2006 to 2020

Rajkot is well placed between the booming Jamnagar port and economic centre of Ahmedabad. In the future once the Dholera SIR is developed it will be within 170km distance.

Jamnagar is home of the Reliance Refinery. Rajkot is between Jamnagar and the motor hub that is developing in Sanand, home to the Tata Nano and other new facilities.

Therefore Rajkot will be a place with increasing commerce and activity, and will hold an increasing significance in region.

 OPPORTUNITY in Rajkot – ACE Riverside

Location:

  • Jamnagar – Rajkot Road
  • near the New Rajkot Cricket Stadium,
  • near the proposed New Airport.
  • Surrounded by 17 acres farm land and the Nyari River.

Property:

  • Two towers of 10 Floors,
  • Each with 4 x 2BHK condos on each floor.
  • Each condo is 1360 sq ft.
  • FREE House Keeping
  • Fully furnished option

Complex

  • Swimming pool and Jacuzzi
  • Multipurpose Hall with AC
  • Party Lawn
  • Mini Golf
  • Cafeteria

Prices: from INR 32 Lacs

Call today for more information: 07960 344 399

DOWNLOAD FULL BROCHURE

Read our other articles on Why invest in India over the UK, Special Enterprise Zones and cities such as Jamnagar and Ahmedabad

ACE Riverside was exhibited very successfully at the HDFC India Homes Fair recently

How to get a first time buyer mortgage

Taking out a mortgage for the first time buyer has become increasingly harder since the credit crunch. With the slowdown of the economy, the rules have become more stringent and lenders too have become more particular regarding whom to lend to. There are a few new schemes available too.

First time buyer: Taking out a mortgage

First time buyer mortgage

First time buyer mortgage

The things that you would require to take out first time buyer mortgage are:

  • Good affordability – In order to take out a mortgage even if it is a first time buyer mortgage, it is important for you to have high affordability. This will mean that if you have high affordability, you will also be able to manage to make the timely mortgage payments. Lenders prefer people who have at least more than average or high affordability.
  • Good credit score – It is important for you to have a high credit score so that you can get a mortgage with low interest rate. Without a high credit score, you may not be able to get low interest mortgages.
  • Clean credit report – In addition to high credit score, you should also have a clean credit report with no missed payments. When you apply for a mortgage, lenders pull your credit reports. If you have missed payments, lenders tend to believe that you are not a responsible borrower. Thus, your loan application may get rejected. Check your reports at Experian, Equifax and Call Credit
  • Low debt to earnings ratio – In order to take out a mortgage, you are also required to have a low debt to earnings ratio. This is checked by lenders to decide if you are a responsible borrower.


Other than having these, in order to obtain a mortgage, you will be required to:

  1. Check out different offers – In order to take out a mortgage, it is important for you to check out the different offers by various lenders. You will have to compare and then decide which the best offer is for you.
  2. Use a mortgage calculator – In order to decide on the cost of a mortgage, you can use a mortgage calculator. This can help you in determining which mortgage you can afford to take out.
  3. Get pre-approved – It is good for you to get pre-approved for a mortgage as this can help you to obtain a loan easily enough. Use an a recommended advisor

So, these are the things that you will be required to do in order to take out a mortgage to buy a home for the first time. Look into new schemes like NewBuy and Helpful Start that have recently been launched

For impartial and honest advice and a FREE consultation get in touch with us info@PropVestment.com

 

HDFC India Homes Fair: Where to invest in India

Where to invest in India: Review of HDFC India Homes Fair, London

Today we visited the HDFC India Homes Fair in London’s Hilton Metropole Hotel.

It was an exciting affair and a busy exhibition.

HDFC India Homes Fair: Where to invest in India
HDFC India Homes Fair: Where to invest in India
  • 100s of potential investors
  • over 60 developers from India

All competing to close that deal and strengthen their brand

There were exhibitors from all major states with a huge presence for developments in Gujarat, Delhi and the NCR Belt. With most of the buzz around the Gujarat developers in the areas of Ahmedabad and Varodara.

Exhibitors included, Hiranandani, Ruchi Realty, Othello Group, Isha Homes, Ramprashta, Triveni Infraspace, Ozone Group, CHD Developers, Orris, Sushma Buildtech, Marvel Reators, Lakh Group and Synthesis Spacelinks.

It was nice to see PropVestment’s recommended Nirav Mehta and Dharmesh Doshi from Asset India.
Another project of great interest to us was Othello Groups, Nautilus development with is in the heart of Varodara with a great significance of sustainability and eco-friendly factors.

For any advice or inside contacts and deals for any of the projects please email us on info@PropVestment.com. We can put you in touch with the right people at any of these developers.

Read our recent series on Where to invest in India on Gujarat, Special Enterprise Zones and Satellite Urban Developments.

Overall the HDFC India homes fair is worth a view for any potential investor, but we do advise you to look around, talk to others who have invested and take professional advice.

 

 

Where to invest in India - Ahmedabad, Gujarat

Trends in the Indian Property Market: Where to invest in India- Part 3: Developing cities in Gujarat- Ahmedabad

 Where to invest in India

PropVestment took a few weeks off from its London to find out where to invest in India. We took a look at a number of factors in a property market that differs that in UK greatly. So far we has discussed, SEZs, Satellite Urban Villages and now the capital city, Ahmedabad

We are sharing some of the observations made in India and how these must be interpreted by a Property Investor and how they should affect your decisions with regard to investments in India.

Fact:

While the Indian economy is expanding at a rate of 8%, Gujarat has a growth rate of over 12%, the highest among all the Indian States. As per a July report in the Economist, the infrastructure in Gujarat can compete with that of Guangdong, the economic capital of China. The implication of this is that if you wish to invest in India, the best place at present would be Gujarat as it has an excellent growth rate and infrastructure. The major growth in Gujarat occurs in its upcoming and developing cities like Ahmedabad.

Where to Invest in India – Ahmedabad

Ahmedabad:

Ahmedabad is the commercial center of Gujarat. It is the largest city in Gujarat and has a booming textile industry. It is important in the industrial sector as it houses numerous textile and chemical industries. It is developing rapidly and boasts of notable architecture and large roads with urban planning. It has amazing tourist spots and fabulous shopping centers. The city is known for its education as it has famous institutes including NID, NIFT, IIM-A, and IHM.

  • Where to invest in India - Ahmedabad, Gujarat

    Where to invest in India – Ahmedabad, Gujarat

    Ahmedabad is one of the fastest growing Tier II cities in India

  • Strong NRI investments have led to price rises in the real estate market in recent years

  • Ahmedabad is marked for steady growth in the coming years. Residential property ranges between Rs.600 in Ahmedabad North to over Rs.1200 on Ring Road currently.

  • Taking advantage of high local population, major builders have laid out commercial projects for the city to accommodate retail malls and luxury hotels.

  • The State Government’s vision is to develop Ahmedabad into a world class city through reforms and infrastructure development. Its mission to make the city clean, livable, productive and self sustaining has led to the setting up of IT parks in and around Ahmedabad.

  • With property available at very competitive rates, Ahmedabad is a sound place for real estate investment. The progressive policies of the state government in pushing for SEZs, an organized workforce, considerable investment from NRIs, and the enterprise of the local population will sustain the upward trend the city is experiencing.

 What does this mean? Where to invest in India?

As an investor, you must note that investments in the metropolitan cities of India are not advisable as the rates of urban migration in these cities is very high, which makes them over- priced.

As India is a growing economy, it is best to invest in those states which have growth rates. As Gujarat tops this list, it is top priority. In Gujarat, a great part of the growth occurs in developing cities such as Ahmedabad.

Ahmedabad is well connected to the rest of the country and has potential for high return on investments made. Due to its booming industry in terms of infrastructure, industry, education, transport and tourism, the city is the right choice for property investments in Gujarat.

However with most developments in India you must take caution and vet the project appropriately.

Many UK residents do have links in the region so that is advantageous too.

Like Ahmedabad there is also great opportunities in Rajkot, Vadodara, and in particular Gandhinagar where it is dubbed as the new capital of Gujarat and very close to Ahmedabad.

 READ

Part One : Where to Invest in India: Satellite Urban Villages
Part Two : Where to Invest in India: Special Enterprise Zones

Barclays Family Affordability Plan & Helpful Start for the First Time Buyer

A Helpful Start for the first time buyer

Barclays helping the first time buyer

Barclays has introduced a new mortgage scheme. Helpful Start is part of their Family Affordability plan. It  allows parents to help their children with mortgages in a way not seen before. A parent’s income is also taken into consideration when applying for the mortgage  without them being on the property deeds.

The scheme is available across all of the lender’s mortgage range, including its NewBuy product.
It enables parents to help their children get on or to move up the property ladder through a joint mortgage without giving a lump sum away.
If the mortgage is approved, all parties will be liable for the monthly payments. The parents will appear on the mortgage but they won’t be co-owners of the property.

Helpful Start is however  not available in Scotland and Northern Ireland.

Family Affordability Plan

When considering to lend to a first time buyer, lenders look at three criteria

  1. Affordability
  2. Credit Worthiness
  3. Loan to Value

The Family Affordability Plan and Helpful Start tackles the first criteria, which has significantly made it difficult for first time buyers to get on property ladder. It will not alter the amount the customer can borrow.

When the first time buyer is ready to manage the mortgage on their own, they can remove their parents from the mortgage by remortgaging soley in their name in traditional way.

There has been a reduction in the number of guarantor-type products in the market over the past few years, this scheme is a step in the right direction.

Ash Shah, Crystal Financial Services

PropVestment always recommends clients use a Independent Mortgage broker like Ash Shah or Crystal Financial Solutions. He comments as follows:

This is a excellent move taken by the High Street lender in a difficult market for first time buyers and those wanting to upscale. Independent Brokers like myself have a wealth of tools available to help clients, and the addition the Family Affordability Plan is a excellent addition to my Tool chest.

PropVestment Conclusion

Helpful Start and the Family Affordability Plan is what first time buyers have been calling for, the last few years have been hard for them to get on the property ladder. We welcome such a scheme and hope other lenders see the light and follow with their own schemes.

READ our first time buyer articles:

For a FREE consultation please contact us info@PropVestment.com , we can help all property investors and first time buyers

Trends in the Indian Property Market: Where to invest in India -Part two: SEZs, Special Economic Zones & Jamnagar, Gujarat

As mentioned in part one of this series of articles Trends in the Indian Property Martket: Where to invest in India, PropVestment spent some time recently in India and in particular in Gujarat. We wanted to analyse the Indian property market and find out where to invest in india, for the most secure and profitable investments.

Here are some facts we found out.

What is an SEZ, Special Economic Zone

SEZ Jamnagar: Reliance Refinery

Special Economic Zone is a particular area inside a state which acts as foreign territory for tariff and trade operations. Government provides tax exemption (IT, Excise, customs, sales), subsidised water and electricity.

SEZ helps in the development of infrastructure of the area around the SEZ, provides employment to people, makes the exports more viable. All this will helps the country’s products to become more competitive vis-a-vis providing all round development of region.

If 100 acres are allocated for SEZ, then only 30-35% of area is used for setting up plants. rest of the area is used to provide housing facilities, malls, multiplexes etc.
Tax exemption is for specific period say for 10 yrs or so.


FACT:
Gujarat has developed a reputation as the fastest developing state in India, especially since the reign of Narendra Modi and huge amounts of FDI that has been attracted to the state.
Here in the UK there are many NRI Gujaratis that often try investing back home in the state or wish to have an asset base back home in Gujarat. This is not to say that this is only an investment option for Gujaratis, but rather for anyone looking for strong secure returns on their investment.

 

Where to Invest in India: Jamnagar, Gujarat

WHAT DOES THIS MEAN:

Why Jamnagar is where to invest in India

  • Jamnagar is one of the most significant cities in the state of Gujarat. The city’s real estate sector  has got a massive boost, bolstered by a handsome investment of Rs 45,000 crore in development of Special Economic Zones

  • It is coined as the “Oil City of India” with Reliance and Essar Oil refineries and associated industries.

  • Jamnagar real estate is expanding with ground breaking projects, which makes the city an ideal place to invest and live in. Noticing the promise in Jamnagar, a multitude of property developers are eyeing the plots in Jamnagar for construction purpose.

  • Rental returns are equally healthy in the city which can range from Rs 8,000 to Rs 15,000 per month for 2BHK (two bedrooms, hall and kitchen) & 3BHK units.

  • The increasing employment opportunities in the city are also pushing up property values in rentals in Jamnagar.

  • Gujarat is also grabbing attention from the NRI populace settled in different overseas locations. The property developers in Jamnagar are designing exclusive schemes, and establishing overseas marketing offices to tempt the deep pocketed NRIs

  • Jamnagar is seeing breakneck industrialisation which has sent the rates for commercial and residential land in the city rise dramatically. Areas on the outskirts of the city like Khambhaliya Road and Lalpur Road are talking of land prices in the range of Rs 500 per sq metre — a 100 per cent jump in a year and still rising.

  • Residential property prices in Jamnagar have doubled in the past 18 months. The surrounding areas of the city will also boom.

  • Residential property in the city boasts of an exceptional “quality of life” for the residents. This is one of the reasons why it is selling fast. The rental market in Jamnagar is also looking promising.

CONCLUSIONS

Like many other cities in Gujarat, Jamnagar is a very promising prospect especially due to the economic progress made due to the SEZ and the major oil refineries. However with most developments in India you must take caution and vet the project appropriately.

Many UK residents do have links in the region so that is advantageous too.

When looking at a project analyse the future development prospects, proximity to transport links and employment opportunities.

Also maybe some part of Jamnagar, its a little too late, the capital appreciation has already occurred, look out instead for neighbouring areas, or other towns where huge infastructure or industrial projects are getting approved.

Like Jamnagar there is also great opportunities in Rajkot, Vadodara, and in particular Gandhinagar where it is dubbed as the new capital of Gujarat.

READ our Part One of this Series : Where to Invest in India: Satellite Urban Villages

McHugh Auction February 2012: The London property market is definitely active

McHugh Auction London

On Thursday 22nd February PropVestment attended the McHugh Auction at BAFTA in Piccadilly. Majority of the lots were residential properties in London. Therefore the results tell an interesting story about the property market activity in London, which is in contrast to other parts of the country.
The observations will be of interest to property buyers, sellers and first time buyers alike.

If we look at all 34 lots, the average highest bid price was £339k, at an average of 14% over the guide price. However with the highest bids, there were still around a third, so 10 properties where the reserve was not met.

Taking out the ones that did not sell, the average selling price was £260k, which was an average of 21% over the guide.
What this shows that the lower value properties or smaller properties sold much better and achieved a much higher price than anticipated shown by the higher percentage over guide.
This also showed that investors are wary of higher value properties and more importantly for these higher value lots sellers want a much higher price and will not settle for less.
For example many of the RNM lots were multiple deed lots, that compromised of HMOs or properties with numerous individual flats.

If we isolate the lots where the reserve was not met, the highest bid on average was marginally lower than the guide with an average highest bid £391k.

McHugh Auction Bargains

  • Studio in Muswell Hill, sold for only £66k, short lease of 58 years but a rental yield at this price of 11%
  • 3 Bed house on Finchley Road, NW2 sold for £320k
  • 3 Bed House, with Annex with 1 Bed sold for £250k in Enfield. Potential to separate deeds and refinance

McHugh Auction Bank Busters

  • Freehold lot with a commercial and 3 flats in Harringay, sold at £750k, 36% over guide
  • 8 Bed HMO in Mornington Cresent, sold  25% over guide at £1.03m
  • 2 Bed Maisonette in Oakwood as seen in our post a couple weeks ago. Short lease with renewal option, Sold 87% over guide at £187k. Lease extension will cost almost £40k.

Conclusions

London market activity is always an exception to rules, there was a greater activity but also positives and negatives seen. Some lots sold, some did not. All about right property, right location. Trend is for smaller properties to be more fluid and easier to buy and sell.
There may be some first time buyers looking for last minute deals on lower value lots before the stamp duty is re instated.

See our other recent article on Auctions:

Allsop Results 

Barnard Marcus

McHugh Auction February 2012: The London property market is definitely active

McHugh Auction London

On Thursday 22nd February PropVestment attended the McHugh Auction at BAFTA in Piccadilly. Majority of the lots were residential properties in London. Therefore the results tell an interesting story about the property market activity in London, which is in contrast to other parts of the country.
The observations will be of interest to property buyers, sellers and first time buyers alike.

If we look at all 34 lots, the average highest bid price was £339k, at an average of 14% over the guide price. However with the highest bids, there were still around a third, so 10 properties where the reserve was not met.

Taking out the ones that did not sell, the average selling price was £260k, which was an average of 21% over the guide.
What this shows that the lower value properties or smaller properties sold much better and achieved a much higher price than anticipated shown by the higher percentage over guide.
This also showed that investors are wary of higher value properties and more importantly for these higher value lots sellers want a much higher price and will not settle for less.
For example many of the RNM lots were multiple deed lots, that compromised of HMOs or properties with numerous individual flats.

If we isolate the lots where the reserve was not met, the highest bid on average was marginally lower than the guide with an average highest bid £391k.

McHugh Auction Bargains

  • Studio in Muswell Hill, sold for only £66k, short lease of 58 years but a rental yield at this price of 11%
  • 3 Bed house on Finchley Road, NW2 sold for £320k
  • 3 Bed House, with Annex with 1 Bed sold for £250k in Enfield. Potential to separate deeds and refinance

McHugh Auction Bank Busters

  • Freehold lot with a commercial and 3 flats in Harringay, sold at £750k, 36% over guide
  • 8 Bed HMO in Mornington Cresent, sold  25% over guide at £1.03m
  • 2 Bed Maisonette in Oakwood as seen in our post a couple weeks ago. Short lease with renewal option, Sold 87% over guide at £187k. Lease extension will cost almost £40k.

Conclusions

London market activity is always an exception to rules, there was a greater activity but also positives and negatives seen. Some lots sold, some did not. All about right property, right location. Trend is for smaller properties to be more fluid and easier to buy and sell.
There may be some first time buyers looking for last minute deals on lower value lots before the stamp duty is re instated.

See our other recent article on Auctions:

Allsop Results 

Barnard Marcus