Profit from your rundown property

Paragraph Image

Being creative in property sales

Taking a property to market in a run down or damaged condition is risky business. Aside from the fact that the properties audience is narrowed to only investors and the few DIY-buyers, you'll almost certainly be squeezed on price in a negotiation frenzy. With Axelrod Property, you'll not only be able to sell your property at todays true market value, but you'll also benefit form a percentage share of the uplifted value once e have undergone the required scheme of works.

Low EPC affecting rental pottential

With the governments intended changes to EPC ratings, by 2025, landlords will no longer be able to rent properties with an EPC rating lower than a C grade. If your property isn't attractive on the open market because of a poor EPC, you can sell to Axelrod and share a percentage of the value uplift once we've renovated and made the required improvements.

Structural issues

Structural damage is not uncommon in properties you nay have inherited or acquired through probate. Whether there is a hole in the roof, or a significant damp course issue, we will rectify the issues and get the house back to a homey and habitable state. After the project we will either sell or get it values, and then share the uplift in value with you as a profit share.

Rising Damp

Moisture from rising damp destroys wallpaper, plaster and eventually brick and masonry. Dampness encourages black mould growth. Rising damp can spread to adjoining timber, causing wet and dry rot. Homes will be difficult to sell or remortgage with an active rising damp problem, not to mention that anyone living in a house with damp could develop health or respiratory problems.

Image 001

Lets take a look at some example numbers 

Lets imagine you have just inherited a run down property from a close families estate. You might have a desire to get into the property landlord game, but dealing with the issues in this property seems a little out of your league at the moment, and you therefore want to cash up and move on to easier project quickly. 

The property in its current position is worth £80,000, but if it was renovated the price ceiling in that area is more like £120,000. 
If you marketed the property today you would potentially face a lengthly wait and some tough negotiations, or you could place the property in an auction house and hope that you meet the reserve, and that the property completed within an expedited timeframe. 

Alternatively, since you are not desperate for this money today (after all, you didn't have it before the probate), you could work with Axelrod Property on what is known as a Purchase Option, or Purchase Lease Option. The numbers are outlines below to illustrate how these options may work to your advantage. 

 

Purchase Lease Option

We agree to purchase the property from you, at price it is worth today, in its current position. This gives Axelrod full control over the property, and it is no longer your headache. Once we have undergone a scheme of renovations (all at our cost of course), we will then have the property valued. The increase in value will then be split with you at a rate of between 10-25%, and you'll be paid this, along with the originally agree purchase price. 

Agreed Purchase Price  £80,000
Term

24 months
Monthly guaranteed payment  £250 (£6,000 over the term)
Cost of renovations (at our expense)  £10,000
Property value after renovations  £120,000
Your share of the increased property value (we pay up to 25% of the net increase)

£7,500
(The increase value was £40,000, minus the £10,000 we have spent on renovations, means you get 25% of £30,000)
Your total earnings 

£93,000

£80,000 for the property PLUS 
£6,000 in guaranteed rent over the term PLUS £7,500 which is your share of the value increase. 
Total % earned compared to its value today  116% of the property value today. And you wont have lifted a single finger! 

The main difference between this option and a Purchase Option, is that we will rent the property within the initial term, and we will pay you a monthly guaranteed payment too. With a Purchase Option, we don't rent the property after the refurbishment, the term is typically shorter, and as we aren't 'using' the property as rental you also don't get a monthly rent. 

Purchase Option  

Lets imagine you have just inherited a run down property from a close families estate. You might have a desire to get into the property landlord game, but dealing with the issues in this property seems a little out of your league at the moment, and you therefore want to cash up and move on to easier project quickly. 

Lets look at the same scenario with the same numbers, but as a Purchase Option. 

Agreed Purchase Price  £80,000
Term

12 months
Monthly guaranteed payment  £0
Cost of renovations (at our expense)  £10,000
Property value after renovations  £120,000
Your share of the increased property value (we pay up to 12.5% of the net increase)

£7,500
(The increase value was £40,000, minus the £10,000 we have spent on renovations, means you get 25% of £30,000)
Your total earnings 

£83,750

£80,000 for the property PLUS 
PLUS £3,750 which is your share of the value increase. 
Total % earned compared to its value today  104.5% of the property value today. And you wont have lifted a single finger! 

The benefits are endless! 

✅ Earn more than 100% of your property's value

✅ Hand over your property headache in 3-4 weeks rather than months 

✅ Get a granted income without lifting a finger on your property 

❌ Don't get annoyed by investors haggling the price down on the open market 

❌ Don't wait 6-9 months conveyancing with he risk of it falling through before exchange   

❌ Save on fees and cashflow by allowing Axelrod to cover any fees you may incur up to now (estate agency fees, solicitor, etc). 

 

Project examples

2225054__1656663056-29588-CAM00618P1-PR0116-STILL12

3 bed terrace

Hull, Yorkshire

This 3 bed was brought to us in a run down state from a recently settled estate. The vendor lived abroad on a 12 month work visa and so needed to be hands off. The property couldn't be rented, so we paid the market price on a PLO, completed the renovation which costs £27,000, and uplifted the value by £40,000. We then shared the uplift with the vendor, paying them 20% for a property they had no involvement in.

2225054__1656663056-29588-CAM00618P1-PR0116-STILL12

3 bed terrace

Burton on Trent, East Midlands

This 3 bed was brought to us in a run down state from a recently settled estate. The vendor lived abroad on a 12 month work visa and so needed to be hands off. The property couldn't be rented, so we paid the market price on a PLO, completed the renovation which costs £27,000, and uplifted the value by £40,000. We then shared the uplift with the vendor, paying them 20% for a property they had no involvement in.

2225054__1656663056-29588-CAM00618P1-PR0116-STILL12

3 bed terrace

South Shields, North East

This 3 bed was brought to us in a run down state from a recently settled estate. The vendor lived abroad on a 12 month work visa and so needed to be hands off. The property couldn't be rented, so we paid the market price on a PLO, completed the renovation which costs £27,000, and uplifted the value by £40,000. We then shared the uplift with the vendor, paying them 20% for a property they had no involvement in.

Why? Second tab Third tab
img-801

First tab content title

She packed her seven versalia, put her initial into the belt and made herself on the way her home. Far far away, behind the word mountains, far from the countries Vokalia and Consonantia, there live the blind texts.

Find out how

Second tab content title

She packed her seven versalia, put her initial into the belt and made herself on the way her home. Far far away, behind the word mountains, far from the countries Vokalia and Consonantia, there live the blind texts.

Learn more

Third tab content title

She packed her seven versalia, put her initial into the belt and made herself on the way her home. Far far away, behind the word mountains, far from the countries Vokalia and Consonantia, there live the blind texts.

Discover now

Sell your home at it's market value in just 4 weeks

Free, no-obligation, 30-minute property portfolio consultation to see how we can help you.

Book now

Download our PLO Information Pack

We've got a handy little guide with examples of how this strategy can deliver a win-win situation.
Download Guide