22nd July 2017
We managed to exchange on a deal we were in a race on. I expected we would do so for a couple of reasons, one was we could take a commercial decision on some of the unknown variables and the other we had a very good lawyer on our team who was all over this deal.
A deal moves as fast as the slowest component, in this case it was the sellers lawyer, who was acting in a very sloppy manner even for a normal conveyancing, let alone a contract race. After a stiff word with the partner, the lawyer assigned to the case was switched, and we then started getting a reasonable level of service. In order to close the deal quickly we transferred the exchange amount to the sellers lawyers account, which was held to order, meaning they cannot do anything with it without the permission of our lawyer.
The deal was a large lateral flat which consisted of 2,200 sq. ft. Originally arranged as three units, it was being sold as one physical flat but as three leases.
The price was £1.6m, which equates to £730 per sq. ft. To give this number some perspective, normal flats in this block have sold for £1,250 per sq. ft. We have sourced many over the years and know the block well. A new build in Wembley, not even in the best area, would be priced at £650 a sq. ft. In short, this was a very good deal.
The aim will be to reconvert it back into three two bed, two bath flats; and hold as a long term rental. This flows with the market, as we are looking at an uncertain two if not three years.
The block, in honesty, is not desirable according to me. However, the Arabs love it; and prices have always been rising here. It’s in very close vicinity to Marble Arch, and part of the block is on Edgware Road. This flat was located in the nicer part of the block, with access through a large communal garden and off the side road.
I asked the agent if he could approach the losing party, and ask them if they still want the deal at £200k above the deal price. I got a response back saying that was a cheeky thing to even ask, but that they would ask the party they were going to flip the deal to, to see if they would increase the price they would pay! There was enough money on this deal for it to be sold again, and the final buyer still would end up with a great deal on his hands.
A property in W2, which our client has recently exchanged on for less than £700k, has been placed in tomorrow’s auction, for a guide price of £775k. We have added some value by pointing out a mansard could be added to the property, at which point you would have an increase in the square footage from 700 to 1130; changing the flat from a two bedroom to a four bedroom.
We are hoping for a higher resale price, but the market is a shaky one, and you need to ride the market sentiment. We will see what tomorrow brings!