We are about to exchange on a deal we sourced last week in Colindale. This deal has been agreed with a completion period of one full year. The real money in this deal is to agree a JV with the developer who owns the neighbouring site. Together this will give us a site where 90 – 100 flats can be built jointly.
We have been thinking and discussing what is the best way to approach the other party.
The strategy when approaching the other party is important, it is always better not to approach from a platform of desperation. In order not to show desperation, the easiest way is not to be desperate.
The idea being to prepare fully our own scheme and then approach the other party, this way we are ready for rejection already and have a backup plan which is a practical one for us to implement on a standalone basis; this way means we are coming from a position of strength and not weakness.
To further add an incentive to work with us is to say we will be approaching the housing association in order to do a joint venture with a view of renting all the flats back to them.
We haven’t done this as yet, but are pretty sure they would be more than happy to work with us, as the word is they are desperate for property. The property which is being made for social housing is declining rapidly.
Housing associations are getting more and more savvy in working with developers and investors, because they have to in order to satisfy an almost insatiable demand.
The percentage of social housing to private has been declining drastically, pre 2010 developers were building 74 social housing homes for every 100 private, this has now dropped to 44 for every 100. A drop of over 40%. If they had kept on track at pre 2010 levels there would be 18,000 extra social houses which would still not have been enough.
With this level of demand there is no doubt there will be no issue in getting some form of grant in order to get social housing.
The reason why we would go down this route is first it will mean we will possibly put less money in the deal, the main point would be to plant a seed in our neighbours mind. As no developer would want to see a site with social housing next door.
The social housing route may be something to embrace rather than shun, if it was part private and part social it may be a bigger issue as there would be difficulty in selling the private given a large portion has been given to social housing.
This would undermine any plans our neighbour has of building private properties and selling them at premium prices. It would severely restrict his ability to firstly sell the properties and secondly get the right price with a social housing block next door. This will be no idle threat from our part as it is probably better to go for the full social housing than have part and part.
This will be the deck of cards we prepare before we go for negotiation with the other party. This does not mean we will play every card just that we will have them to hand should we need to play them.
There is also another way to reduce the value of your neighbour’s house and that is to paint the front of your house with red and white strips which is exactly what a property developer did! She angered her neighbours by covering her £5 million townhouse in Kensington in red and white stripes over a planning issue.
The three storey house was painted in the manner of a circus big top in what is suspected to have been a deliberate snub to residents who objected to the owner’s plans to demolish the building and replace it with a luxury home.
The property is in a cobbled street called South End, which forms part of Kensington Square conservation area.
The developer Ms Lisle-Mainwaring’s house is the subject of a pending application to knock down and rebuild the property – adding a three-storey basement excavation with a swimming pool. The next-door neighbours understandably were worried about their foundation, given the recent issues basement dig outs have been causing.
Some years ago we had purchased a property in Ealing, a detached house which was used as a drug rehabilitation centre, but was sold with vacant possession to us. We purchased the site with a view of converting it into several flats. We went for a pre application with the council who were very positive and we discussed subjects like where the sun would shine and where the bicycle racks should go. We left the meeting feeling positive about the response.
A pre-application is followed up in writing to confirm what was discussed. This was not forthcoming from the council. After several times of chasing it finally came through; in the letter the council had done a hundred and eighty degree U turn. They felt a drug rehabilitation centre was required in the area and needed for community use.
This besides being totally different to what was discussed, was a ridiculous assertion. Firstly the property had been disposed of for a reason, it wasn’t needed. Secondly the property no longer met the requirements for a rehabilitation centre and thirdly this was a residential road, no one on this road would want a rehabilitation centre here.
At this point we were tempted to retaliate and blow up the property. It was after all our property. Therefore we could get a demolition license and destroy the whole property, so then there would be no centre there. This would then be an eyesore for everyone and pressure would mount on the council to do something with the site.
Planning can be a minefield and its important to have a planning officer on board when engaging with the council preferably one who has dealt with the council previously.
The Real Deal
Hyde Park, London, W2
Purchase Price: £650,000
- A bright one bedroom apartment in the heart of Hyde Park Estate with tremendous views of London skyline
- Long lease
- Very good condition
- Excellent buy and hold opportunity
- Properties are being sold for around £1,200 to £1,500 per sq. ft. in this location and we are getting this property for around £1,000 per sq. ft.
- We believe the value of the property will be around £775k
- Massive capital growth potential in the future
- Close to the beautiful open spaces of Hyde Park and shopping amenities
Call us now to reserve!!
Sow & Reap
A Property Investment Company
!Tips of the Week
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