Property Report
Grisedale Close, Crawley
Objective
Convert 4 bedroom house into a high specification 6 bedroom, 6 ensuite shared property, aimed at the higher end of the professional tenant market, delivering profitability of 14% Net Yield.
Summary
Create 6 En-suite Bathrooms
Convert Garage into a new bedroom
Create one new dividing Wall between the Living and Dining Area
Open up the dividing wall between the Kitchen and newly created room
Open up the dividing wall between the Bathroom and Bedroom
Create one new dividing Wall between the Bathroom and Bedroom
New Water Services installed to facilitate the creation of the 6 En-suites
Completed Development in Pictures
HMO Rental Markets
The HMO market in Crawley is thriving given that there are 264 rooms/properties available on a very broad search in the area with Sparerooms. The fact that Article 4 has not been implemented also shows that supply is still not fully meeting demand.
Filtering further on double rooms shows 212 rooms/properties available and then 13 rooms/properties when ensuite is selected too and focusing in Central Crawley.
It is clear from general research in the HMO market that the ensuite room is becoming the preferred option for tenants and so we are ahead of the curve with our development.
When applying at filter of at least £625 a room then 7 still remain within this same area, showing a healthy demand of properties of this nature. Given my objective to create a high quality specification property with an ensuite in every bedroom, this analysis shows we are very competitive.
Room Rental Value
We have then analysed what we believe would be the normal market rent achievable based on the above data and what we have already let the rooms out to date for. Rooms A, C and E currently let out already at £685, £650 and £675 respectively.
| Room | Monthly Rental |
|---|---|
| Room A | £685 |
| Room B | £635 |
| Room C | £650 |
| Room D | £650 |
| Room E | £675 |
| Room F | £650 |
| All Rooms | £3,945 |
Our Analysis Shows: Normal Market rent to be averaging £706 x 6 rooms x 12 months – £50,800 per annum with the
December Market (Property on the rental market) rent to be averaging £658 x 6 rooms x 12 months – £47,340 per annum
Purchase and Development Costs
| Item | Cost |
|---|---|
| Deposit | £47,250 |
| Stamp Duty/Legals | £16,700 |
| Mortgage Fee | £6,700 |
| Loan Payments/Bills | £10,400 |
| Development | £46,600 |
| Total Cost | £127,650 |
Annual Profit and Loss
| Items | Total |
|---|---|
| Income | £50,800 |
| Mortgage | £13,360 |
| Agency Fees | £6,033 |
| Maintenance at 10% | £4,826 |
| Void Periods at 5% | £2,540 |
| Other Bills | £5,568 |
| Total Profit | £18,474 |
Gross and Net Yields
| Yield | % Return |
|---|---|
| Gross Yield | 38.90% |
| Net Yield | 14.47% |
Development Project – Floorplans
Existing
Proposed
Development Process in Photos
Converting the Garage
Converting the Kitchen/Diner
Creating an ensuite
