Buying a commercial premesis as a rental

Investor2000

Hello,

Is this a good investment if i can get it for a bit cheaper say 10 to 20k?

The income is £6100 per anum but subject ti review ina. Couple years. Has a long lease which is appealing.

However will i be reaponsible for the barber equipment or just the basic things like electricity, plumming any maintenance etc??

.zoopla.co.uk/for-sale/property/london/lullington-road/?results_sort=lowest_price

Also resale value should be good becuase 250 year lease

davidmcn

Investor2000 wrote: »

However will i be reaponsible for the barber equipment or just the basic things like electricity, plumming any maintenance etc??

It's likely the tenant will be responsible for all of that. But you'd need to read the lease to check. If you're not already aware of basics like this, I'm not sure it's for you.

LilElvis

It's been listed since July 2017 - so why no takers in over 18 months if it's such a great opportunity?

Investor2000

LilElvis wrote: »

It's been listed since July 2017 - so why no takers in over 18 months if it's such a great opportunity?

Off the top of my head it honk the low yeild (not too bad for the price acrually but not worth the hassle i spose for most people)

High ground rebt and service chatge relative to the rent.

It’s limited to a barbers for three more years then i assume it goes back to a general commercial premises...

What does anyone else think?

I don’t have alot to invest as i saod only 70k but rather than having it sit in a savings account gaining little interest i’d much prefer to have a property where it generates a much higher income and also will get me my moneh back plus profit whenever i decide to sell it. Those are the most inportant things.

da_rule

Investor2000 wrote: »

It’s limited to a barbers for three more years then i assume it goes back to a general commercial premises...

There is no such thing as 'general commercial premises'. It can be used for what ever permission/class usage it has. Changing this may not be possible. The use/the ability to change the use may also be restricted by the lease.

I would politely suggest that you don't know enough about commercial property and it isn't something that one should dabble in.

The information with regards to the lease (to the barbers) is also very scant. You don't know if the rent review is upwards only, or could it go down. You don't know if the lease has security of tenure, in which case they can demand a new lease at the end of the current one on the same terms and you will potentially struggle to resist this. This also limits the rent increase you can impose on the grant of a new lease.

David_Evans

Investor2000 wrote: »

Off

I don’t have alot to invest as i saod only 70k but rather than having it sit in a savings account gaining little interest i’d much prefer to have a property where it generates a much higher income and also will get me my moneh back plus profit whenever i decide to sell it. Those are the most inportant things.

What makes you think the property will go up in value?
Are you experienced in commercial property investment?

Assuming you are bullish on commercial property in general, why would you prefer to invest all your money in this one property - as opposed to a diversified portfolio of property funds / REITs?

davidmcn

Just across the road from the barbers, there's also this flat behind a pizza shop for sale. Might be worth a look.

Investor2000

davidmcn wrote: »

Just across the road from the barbers, :cool:zoopla.co.uk/for-sale/details/50295260"]there's also this flat behind a pizza shop for sale[/URL]. Might be worth a look.

Yeh i know. The lease is only 71 years so would need to have it increased which will cost 10k according to an old ad they listed a few years ago...

It says its ground floor though and the garden is a ground floor garden so i think its at the back of the house but im almost certain the front door is at the front which is good.

Something like that i would prefer for aure just as lonng as it had a long lease i dont see why it wouldn’t make a profit if i went to sell it in a few years time...

David_Evans

Investor2000 wrote: »

Yeh i know. The lease is only 71 years so would need to have it increased which will cost 10k according to an old ad they listed a few years ago...

It says its ground floor though and the garden is a ground floor garden so i think its at the back of the house but im almost certain the front door is at the front which is good.

Something like that i would prefer for aure just as lonng as it had a long lease i dont see why it wouldn’t make a profit if i went to sell it in a few years time...

Why are you so keen on BTL?

Investor2000

David_Evans wrote: »

Why are you so keen on BTL?

Becuase i want the rental income... osn’t that obvious?

David_Evans

Investor2000 wrote: »

Becuase i want the rental income... osn’t that obvious?

But why do you assume BTL will give you a better return than equities or REITs etc?

Not saying you're wrong.
Just curious, as it's such a bad time for BTL generally...