BTL · Property AnalysisA 2-bedroom mid-terraced property located in DN35. With an asking price of £125,000, this property is in good condition but requires minor cosmetic uplift to maximize rental yield. Targeted at first-time buyers and BTL investors.
Based on current market data for 2-bed terraces in the DN35 area, a rental value of £625 pcm is achievable following minor improvements. The ROCE calculation accounts for a £30,000 deposit, £12,000 for refurbishment, and acquisition costs (including the 1.5% bank fee of £1,425), totaling £45,425 of invested capital. With £158 monthly cash flow, the annual net cashflow is £1,896.
Projected monthly cash flow is positive at £158. This assumes interest-only mortgage payments at 4% interest rate on a £95,000 loan, plus estimated maintenance, insurance, and management fees. This provides a safe buffer against minor interest rate fluctuations.
Cleethorpes remains a popular coastal residential hub. While growth is steady rather than explosive, the property's proximity to the seafront and local train stations ensures continued demand. Market Value Analysis after Refurb suggests a ceiling of £135,000 for this specific terraced street, allowing for modest forced appreciation.
The deal passes stress tests easily at current rates. Given the status of the buyer (First-time buyer), access to competitive rates is likely, though deposit requirements must be strictly maintained.
Cleethorpes experiences consistent demand for 2-bed housing. The proximity to the seafront and train links makes this attractive for young professionals and small families. Void risk is assessed as Low.
The property is in good, clean condition. The 'refurb' focus is purely to 'market-ready' standards to command the upper end of rental estimates. No add-bedroom potential exists as the footprint is constrained.
Low-medium risk. The property is Freehold, mitigating leasehold complexities. Main risks are localised to the Cleethorpes secondary market if seaside tourism or employment shifts.
Vinyl/Carpet Flooring - Cost: £1800
Paint & Supplies - Cost: £800
Light Fittings - Cost: £300
Kitchen Cabinet Hardware - Cost: £200
New Internal Door Handles - Cost: £150
Bathroom Accessories - Cost: £250
Window Blinds - Cost: £400
Skirting Boards/Architrave - Cost: £500
Garden Fencing Repair - Cost: £400
New Front Door Hardware - Cost: £150
Cleaning Supplies/Equipment - Cost: £200
Curtains/Poles - Cost: £300
Smoke/CO Detectors - Cost: £150
Shelving/Storage units - Cost: £300
Outdoor Planters - Cost: £100
Painting & Decorating - Cost: £2,000
Flooring Installation - Cost: £800
Kitchen Refresh Labour - Cost: £1,000
General Joinery/Repairs - Cost: £700
Garden Landscaping - Cost: £600
Electrical Testing - Cost: £300
Plumbing Checks - Cost: £300
Professional Cleaning - Cost: £250
Waste Removal - Cost: £300
Snagging - Cost: £200
Assemble Flatpack Furniture - Cost: £250
Install Blinds/Curtains - Cost: £150
Deep Carpet Clean - Cost: £150
Minor Plaster Patching - Cost: £400
Locksmith/Security Check - Cost: £100
Total Estimated Duration: 4 Weeks || 1 Month
Proceed. This is a low-risk, steady cash-flow investment. The key to this deal is the purchase price; with similar properties selling between £100k-£130k, an offer of £120,000 (negotiated down from £125,000) would significantly enhance the ROCE and buffer the investment. The property is a "turn-key" rental opportunity provided the cosmetic updates are executed efficiently.