Buying a business (cattery/kennels) - how?

Aquamania

thenewbee wrote: »

Hi all

I'm a first time poster in this forum. I currently run my own business, a dog walking and pet sitting service. A friend mentioned something to me the other day and it's got the old cogs turning...

There's a cattery and kennels business for sale in a nearby village. It's for sale along with the residential house, for £695,000 with annual turnover of £120,000.

Were I ever to buy a business like this one, how would it work? Would I get a regular mortgage from a bank as it's a residential house? Or would it be a commercial mortgage? Would the turnover of the business be taking into account when assessing me for a mortgage or would it just be my income as with a regular resi mortgage?

Any insight and info much appreciated. Currently pie in the sky but I'm curious for more information and can't find anything online.

Unless you can clearly separate the commercial part of the land from the house, then you would probably have to have the whole lot under a commercial mortgage.
(from the links provided by others, it doesn't look like the commercial side can be clearly separated from the house)

As a self employed person, your earnings (PROFIT, not turnover) would be taken into account. I understand you are already self employed. If you plan to continue your current business, then that can be added to the anticipated profit your business plan will show for this new investment, which would naturally start from what that business earned (not turned over) recently.

Of course, any mortgage would need to be secured against the land and property, and it seems that would only be valued about £400k at best.
And expect the lender to then ask you to put down at least 25%

So you would be looking at needing about £400k as a deposit, even if you get a mortgage.

lincroft1710

martindow wrote: »

Is this the house or next door? £399,950. If so they are still valuing the business at £300k.

http://www.rightmove.co.uk/property-for-sale/property-31678881.html

It's next door. Would you pay £400K to live in a 3 storey semi next door to boarding kennels??

motorguy

Aquamania wrote: »

Unless you can clearly separate the commercial part of the land from the house, then you would probably have to have the whole lot under a commercial mortgage.
(from the links provided by others, it doesn't look like the commercial side can be clearly separated from the house)

As a self employed person, your earnings (PROFIT, not turnover) would be taken into account. I understand you are already self employed. If you plan to continue your current business, then that can be added to the anticipated profit your business plan will show for this new investment, which would naturally start from what that business earned (not turned over) recently.

Of course, any mortgage would need to be secured against the land and property, and it seems that would only be valued about £400k at best.
And expect the lender to then ask you to put down at least 25%

So you would be looking at needing about £400k as a deposit, even if you get a mortgage.

+1

The bank will see it as a commercial venture and value it as such.

Cant see them being willing to put up anywhere near that.

Aquamania

martindow wrote: »

...
Is this the house or next door? £399,950. If so they are still valuing the business at £300k.

http://www.rightmove.co.uk/property-for-sale/property-31678881.html

That appears to be next door, the other half of the semi.

Note that that house also benefits from a loft conversion which adds 2 bedrooms, but I think they may have sacrifiiced one bedroom for a large bathroom on the 1st floor, so has 4 bedrooms in total.

I think the one the OP is asking only has the 3 original bedrooms but obviously has some outbuildings associated with the business too.

lincroft1710

Google maps gives a nice aerial view of the property and all the kennel and ancillary buildings.

Just type Thorner LS14 3DJ into the Google Maps website.

sequence

I'm pretty sure you could set up your own cattery/kennels almost anywhere for a lot less than £695,000!

Mistral001

thenewbee wrote: »

I would guess the home on its own would be worth around £250,000 minus the business .....

But is it worth that to someone who wants to buy the property just for the house and grounds alone? They would have to factor in the demolition of the kennel buildings, landscaping etc. into their the price they offered, which could mean they would only be willing to pay considerable less than the £250,000.

Ianport

Sorry to dig up and old post but I've been searching around and the post came up.

I am looking at purchasing an existing buisness with living space.

My situation is; my wife and I both work in the public sector, working long unsociable shifts and it's taking a strain on our life and relationship. And we would like to run a kennel business together and want a complete change in lifestyle. My wife would also like to foster which would be an additional income to the business.

We currently own a house which we purchased for £262500 but is now worth upward of £300000 if current trends continue. Most of our money is currently tied up in the house and do not have any other substantial savings or assests at present.

Having never bought a business before I have no idea where to start and would like to know how realistic it would be to turn this dream into a reality. Any advice?

Thanks

paddyrg

Lanport, I'd suggest starting a new thread so your responses don't get caught up with people late to the party on the previous comments!