PM SPV 72
2 Bedroom Mid-Terrace Property
About this property
Your capital is at risk if you invest.
- A modern 2 bedroom, mid-terrace property in Middlesbrough
- The property is in great condition, though will undergo a minor interior redecoration to modernize it and hopefully ensure a tenancy as soon as possible
- The property is secured at a purchase price of £44,000 which reflects a 35.69% discount to the open market valuation when including the £1,000 renovation fee
The property has a generous sized lounge area that leads to a modern kitchen, which has double glazed UPVC French doors that overlook the well-kept and low maintenance yard. Upstairs there are two double bedrooms and a family sized bathroom including a bath and a shower. The property was built in the 1990s, is reasonably modern and in great condition. However, to try to ensure tenancy as soon as possible, we have provisioned a £1,000 fund for an interior redecoration. Once this has been completed, we anticipate a monthly rental income of £450 will be achieved.
The property is located in a modern cul-de-sac, south of the River Tees and north of the North York Moors National Park. It is situated on the outskirts of Middlesbrough town centre, which can be accessed by the main bus route at the bottom of the property’s road. Popular local attractions including the Cleveland Retail Park, Middlesbrough Institute of Modern Art and the Riverside Stadium (host to the town's football club), can be reached within a short drive. In addition, the main Middlesbrough train station is a 10-minute drive away and connects commuters to Hartlepool and Sunderland within an hour.
Two market appraisals carried out on the 20th of December 2016 and 09 January 2017 value the property at £70,000 and £69,950 respectively as an asking price. Using the average of the two values, £69,975, this equates to the property being purchased at a discount of £25,975 (35.69%) to the open market value (£44,000 purchase price + £1,000 renovation).
The Royal Institute of Chartered Surveyors have predicted a 3% property price increase for the North East. You can see more information on our blog post HERE but please remember that property prices can go down as well as up.
There is an additional ‘Acquisition cost’ (shown as 'Furniture cost') which represents a finance fee paid to PMF B and PMF B3 Ltd, and property management disbursements (auction fee, inventory, checkout, inspection, visit). This structure can provide access to new routes of property sourcing at large discounts. In addition, a monthly Accounting Fee and Corporate Governance fee of £15 and £25 respectively has been factored into the rental yield calculation (this is shown as an annual 'Service Charge' cost and represents £480 of the total).
Please bear with us while we update the names of these fields on the website. To confirm, the projected returns are net of these fees. There is no British Gas utility cover on this property, and the insurance cost of £254.99 per annum reflects the landlord insurance, which is put in place on all investments and also now benefits from a rent recovery option in the unlikely instance that a tenant may withhold payment of rent.
About the area
The property is based in Middlesbrough, North Yorkshire and is a 10-minute drive to Teeside University, which is one of the most affordable campuses in the UK and ranks in the top 3 for student satisfaction for international students. Recently, over £270 million has been invested in the main campus in the centre of Middlesborough as the University is prepared to compete with neighbouring institutions.
The property also benefits from a range of activities within a short drive, including the scenic North York Moors National Park, which attracts 10 million visitors per year and provides a significant form of income for the area. It has also been confirmed that £1.7 billion will be invested in a small area of the North York Moors National Park to develop a potash mine that is expected to create over 1,000 jobs and help restore the mining heritage to the area. It is predicted that the mine will increase North Yorkshire’s economy by 10%. In addition, £48 million is being invested alone in the surrounding area.
In 2014, the region was listed in the top 3 regions to visit in the world. The area has experienced a sudden rise in popularity, compounded by events such as the Tour de France in 2014. Athletes from the county have also won an astounding 12 medals for Great Britain in the 2012 Olympic Games. If North Yorkshire was an independent country it would have ranked twelfth on the medal table!