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Homes Under the Hammer, 03/03/08
PasturesNew
Posts: 70,698 Forumite
Bought to Flip. Crashed and Burned.
I had Homes Under the Hammer on the TV in the background this morning.
Unfortunately I was working, so couldn't listen in or watch properly.
One house they saw appeared to have nothing wrong with it. Nice and clean, tidy. It sold at auction for £101k.
The presenter then interviewed the new owners. BTL landlord/flipper. The presenter asked him what he was going to do: "Spend £3k and sell it at a profit" was his answer.
The presenter pointed out that other houses in the road were not selling. From the buyer's face you can see that this hadn't been checked at all. The reason this house had gone to auction was purely because the seller hadn't found a buyer and wanted it shifting quickly.
On this programme, they go back a few months later to see what the buyer's have achieved. On revisiting, two estate agents are brought round for valuations. This buyer had spent £101k + £3k doing it up. So £104k.
EA valued it at £108k. Or £450-500 for rental. One said some houses on that road were still for sale after 2 years.
Presenter asked the man what he thought of that. He was miffed and said £108k was way too low. Other houses in the road were on at £120k and £113k. Priceless.
All this guy saw obviously was "A house there is £120k. If I buy one at auction and paint it magnolia, I can stick it on at £125k. Making £20k profit"
So he will be renting it out most likely. Presenter said that the rent would not even cover the mortgage.
As I said, I wasn't watching/taking note/etc all the way through, but it was in some road called Kenilworth Close/Road, Scun thorpe.
I had Homes Under the Hammer on the TV in the background this morning.
Unfortunately I was working, so couldn't listen in or watch properly.
One house they saw appeared to have nothing wrong with it. Nice and clean, tidy. It sold at auction for £101k.
The presenter then interviewed the new owners. BTL landlord/flipper. The presenter asked him what he was going to do: "Spend £3k and sell it at a profit" was his answer.
The presenter pointed out that other houses in the road were not selling. From the buyer's face you can see that this hadn't been checked at all. The reason this house had gone to auction was purely because the seller hadn't found a buyer and wanted it shifting quickly.
On this programme, they go back a few months later to see what the buyer's have achieved. On revisiting, two estate agents are brought round for valuations. This buyer had spent £101k + £3k doing it up. So £104k.
EA valued it at £108k. Or £450-500 for rental. One said some houses on that road were still for sale after 2 years.
Presenter asked the man what he thought of that. He was miffed and said £108k was way too low. Other houses in the road were on at £120k and £113k. Priceless.
All this guy saw obviously was "A house there is £120k. If I buy one at auction and paint it magnolia, I can stick it on at £125k. Making £20k profit"
So he will be renting it out most likely. Presenter said that the rent would not even cover the mortgage.
As I said, I wasn't watching/taking note/etc all the way through, but it was in some road called Kenilworth Close/Road, Scun thorpe.
0
Comments
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It was in S!!!!horpe North Lincs..I was also kind of watching.
No I didnt swear unfortunately its edited the spelling but I'm sure you all know where I mean.
PinkPunkBird 0 -
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The house was in Scun thorpe.
The guy only looked through the windows of the house, he hadnt been in so was surprised at how little needed to be done. He was going to spend £3k but when the presenters went back he had spend £300 on pulling up the paving slabs at the front and putting some concrete down and chipping the lawn area also puttin up a small fence.
He then thought he should make a huge proffit, in a street that has many other houses for sale. Basically he didnt do his research.Waddle you do eh?0 -
It is on Rightmove: http://www.rightmove.co.uk/viewdetails-18045539.rsp?pa_n=1&tr_t=buy
£115k
The auction date was July 2007, so he's had it 8 months now.
8 months' IO mortgage £580 = £4640
HIP = £400
He's already spent £5k since auction.
So let's tot that up for him:
£101,000 - to buy at auction
£3,000 - fees
£4,640 - mortgage to date
£400 - HIP
===
£109k
Still to come:
Estate agent fees
Solicitor fees0 -
He did look like nothing was going on between his ears.0
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PasturesNew wrote: »It is on Rightmove: http://www.rightmove.co.uk/viewdetails-18045539.rsp?pa_n=1&tr_t=buy
£115k
The auction date was July 2007, so he's had it 8 months now.
8 months' IO mortgage £580 = £4640
HIP = £400
He's already spent £5k since auction.
So let's tot that up for him:
£101,000 - to buy at auction
£3,000 - fees
£4,640 - mortgage to date
£400 - HIP
===
£109k
Still to come:
Estate agent fees
Solicitor fees
Priceless. Once he realises that ongoing mortgage payments v's sale price will actually equate to a loss soon, he will probably up the asking price in the desperate hope to recoup the loss, only to make things even worse for himself.
Sorry, but people that think you can add 20k to a house's value in the current climate with a tin of Magnolia trade paint deserve a wake up call. The motivation was obviously based on greed, rather than a well thought out business plan.0 -
While it may make interesting TV, its frustrating dealing with these 'property developers' in real life. I've met a few & I do wonder at what point there common sense deserted them.0
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Let's face it guys, property !!!!!! like HuH hardly help the situation.
"Yes you can become rich with just a tin of magnolia paint and laminate flooring."
Come the revolution, these and other similar program presenters (particularly Krusty) will be first against the wall
;) In case you hadn't already worked it out - the entire global financial system is predicated on the assumption that you're an idiot:cool:0 -
PasturesNew wrote: »
Well with quality details like that, its bound to walk out the door. Nice bit in the blurb about it being an 'ideal investment', they may want to re-write that bit after todays programme.0 -
He must have put it back on the market immediately as the photo dosnt even show the work he did to the front garden which made it look slightly better.
He must be getting a cheap deal with the estate agent as the details are terrible, he would be better rent it out for a few years and try to sell it again in a few yearsWaddle you do eh?0
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