To expand their property portfolio, experienced business owners and landlords identified a promising investment opportunity in a decent location close to Birmingham city centre.
The Birmingham property, an extended three-bedroom terraced house with off-street parking and significant potential for improvement, was valued at £185,000.00. The investors sought to secure bridging finance to acquire and refurbish the property, with the aim of transitioning to a long-term buy-to-let mortgage as their exit strategy.
The plan involved self-funding the refurbishment to make the property lettable. With an experienced in-house team of builders and decorators, the investors were confident in their ability to efficiently complete the necessary works. This strategic approach aimed to minimise downtime and expedite the property's readiness for rental.
Property Valuation: £185,000
Gross Loan: £120,250
Gross Loan-to-Value (LTV): 65%
The journey to secure financing involved overcoming challenges such as tight deadlines and legal complexities. Despite these obstacles, the loan completed in a 5-week timeframe.
This case highlights the position of bridging finance in real estate investment, enabling the swift acquisition and refurbishment of a property with high rental potential. It illustrates the importance of a clear exit strategy, effective project management, and the potential for value addition in properties with latent potential.