I've been mulling something over.....

Gingernutty

I currently own a three bedroomed terrace in a not very nice area. It's a dump, but I've been living here for over ten years.

Neighbour issues were a problem in previous years, but things have calmed right down.

I own it outright after my Dad died leaving an estate in London which was sold off leaving me and my brothers well looked after.

I've paid off the mortgage and have a substantial amount of cash in a variety of accounts.

I am in the position of being able to refurbish my house to a good standard and to that end, engaged an architect, who knows a reliable a builder and they set about a structural survey before giving me estimates.

:eek:

Note - I didn't get a full structural survey before I bought it, just a homebuyer's, valuation survey.

As well as the bits I knew needed doing (wiring, plumbing etc) the survey has uncovered the house is structurally unsound and the bathroom extension essentially needs to be taken down and started again.

Just for giggles, there's Japanese Knotweed in the neighbourhood, the closest of which I am addressing.

The owner of the privately owned house immediately next door to me has recently had a sale fall through due to JK within 20m of his property.

I'm closer to the JK than his house is.

In an nutshell, the house is currently worth nothing. If it were up to standard, it might raise approximately £70,000, but on getting an estate agent in to value it, he walked away laughing without my custom.

It can't be sold or let out in its current condition and as it's in the middle of a terrace, I can't just walk away to let it carry on rotting and start again in a new house.

The estimate for the work is approximately £30,000.

I can afford this. I can also afford a small new build house or apartment in the town where I actually work (over an hour to work by bus).

Plan 1. Move out and rent for a short period while the work is being done, move back in again. Wait for the JK to die then sell.

I will never get the money back that I have spent on the house but it keeps things simple.

Plan 2. Move out permanently. Either renting first then buying or buying one of the new build places I have an eye on in the town where I work.

Get the building work done and then become an absentee landlord.

Not a very stress free option, but the rent may allow me to recoup some of the money spent on the house and allows me to wait until the JK is dead before selling.

Heart (wanting an easier life) says Plan 1.

Head (a little more business minded) says Plan 2.

I have to add that good tenants around here are hard to come by and any tenancy would have to be carefully monitored.

What would you do?

moneyistooshorttomention

Personally - I'd probably look to sell it to a developer or the like. So I'd put it up for sale at auction. As you have enough money to buy "somewhere" without taking into account the money tied-up in this problem house - then I would tend to think its worth it to take the hit of a reduced price at auction to save the hassle of being the one having to deal with those multiple problems.

Yep....the one not under my control would be the one that would worry me most - ie the JK.

But, if the place is so bad that EA's laugh at the thought of having it on their books and walk away - then it must be bad big-time (considering how awful some of the properties I see on EA's books are) - having experienced at first hand a property that a particularly optimistic EA was describing as "ready to move into" that I've nearly finished gutting...

Pixie5740

Plan 2 gets my vote. No matter how much money you throw at the property you'll never be able to change its location and if nobody is tackling the JK problem then it will only get worse.

Put the property up for auction and get the hell out of Dodge.

DaftyDuck

First thing to do is get some more builders in. What do they say? No point spending too much on that property if the area isn't great, but I wouldn't give up getting my money back yet. JK is a greatly overrated threat, and can be treated easily IF you can get at it yourself, or all cooperate.

Get more estate agents in for advice. One who walks away from any sale is worth ignoring.

Nobbie1967

Auction and then move on with your life. Not worth pouring money into a dump in a bad location with JK and potentially bad tenants. You can't put lipstick on a pig!

You might be lucky and get a couple of new by BTL landlord bidding against each other :-)

AdrianC

Gingernutty wrote: »

I've paid off the mortgage and have a substantial amount of cash in a variety of accounts.

In an nutshell, the house is currently worth nothing. If it were up to standard, it might raise approximately £70,000, but on getting an estate agent in to value it, he walked away laughing without my custom.

The estimate for the work is approximately £30,000.

I will never get the money back that I have spent on the house but it keeps things simple.

The house is currently worth near-enough-zero.
You spend £30k.
The house is worth £70k.
<shrug>
Looks like good value to me.

If you don't want to do that, then shove it to auction and find out exactly how close to zero it's worth. Unless you get two potential buyers with rose-tinted glasses and an imbalance of clue and enthusiasm, you will have a buyer at a price somewhere around the finished value minus (cost to do the work plus profit plus contingency).

Gingernutty

Thank you for all your replies.

Plan C - Buy somewhere else and auction property off. Hopefully, someone might want it, although there have been some properties which haven't sold at auction.

There are a lot of rental properties around here - there are two social housing associations as well as private rentals as well.

There are some private owner occupiers but we are not in the majority and many have family or some other reason keeping them here.

The area is a landlord licensing area. Anyone who wants to be a landlord must be shown to be a fit and proper person and have a licence costing £525 for each property let.

ETA: I bought this place as it was close to all transport links (bus, train and tram), close to the city centre (shops, facilities etc) and at the time it was 'on the up'.

There were exciting plans and developments in the pipelines including Tesco, who had just bought a huge site a few streets away, I had a good steady job and it seemed ideal.

:rotfl:

Wolves has just gone downhill since then, with a financially incompetent council, shops closing down left, right and centre, right up to Tesco abandoning plans for the site local to me and a lot of the bought land and properties for the "exciting developments" just left to rot.

Property prices have been depressed as a result.

AdrianC

Gingernutty wrote: »

Plan C - Buy somewhere else and auction property off. Hopefully, someone might want it, although there have been some properties which haven't sold at auction.

But have they been unsold because the vendor's had an unrealistically high reserve price? ANYWHERE will sell - although it might sell very, VERY cheaply.

Gingernutty

AdrianC wrote: »

But have they been unsold because the vendor's had an unrealistically high reserve price?

Dunno.

moneyistooshorttomention

Well - I guess it may be possible to go into the relevant firm of local auctioneers with details/photos of your property and ask them what similar ones have sold for.

That's not to say that luck doesn't enter into it - as to exactly who is at an auction at any given day. However, it might give some idea.

Darn annoying to see an area that was supposed to go up going down. You can never quite tell with Councils - mine were busy trumpeting that my last area was going up. However, I found out a bit of what was going on "behind the scenes" and was going to have the exact reverse effect a few years down the line - and hence part of the reason I sold when I did (based largely on knowing what that Council was like for demolishing perfectly good buildings - oh...because they are "ever so old" unless they are virtually brand new).

Gingernutty

I've booked an appointment to view a new build property on Tuesday.

I'm freaking out, I'm so nervous!!

New mantra - "It's just a viewing. I'm not obliged. It's just a viewing. I'm not obliged. It's just a viewing. I'm not obliged. It's just a viewing. I'm not obliged. It's just a viewing. I'm not obliged. It's just a viewing. I'm not obliged......."