Located in the heart of Upper Bangor, the property had been previously let as a 4 bedroom house with a kitchen/dining area and a double bedroom to the ground floor, with another double, single bedroom and bathroom to the first floor. In the loft was another double bedroom with restricted headroom. All facilities to the property were very dated and in need of complete overhaul and due to this the property was no longer in a lettable condition. Clearly the property needed an overhaul cosmetically, however this was also the prime opportunity to reshape the property and future proof it as much as possible both in terms of its long term lettings appeal but also structurally. A kitchen split into two rooms made for an awkward space which did not flow well at all, especially with laundry goods being located upstairs in the bathroom. The space also didn’t allow for a lounge area so it became a priority to open the space up to encompass a modern kitchen well appointed for 4 students along with a comfortable lounge area to relax, watch TV and entertain.
The way to do this was in 2 parts. Firstly, increase the size of the opening between the two rooms and utilise wasted space underneath the stairs. Secondly, the existing back door needed to be blocked up and relocated to the lounge area, thus increasing wall space along which the kitchen can be fitted. New floor joists were required to the bathroom able at this point also to ensure its longevity. Although we were unable to find space for a specified dining area the finished rooms work really well and achieve the goals we set.
The ground floor front room of the property was a good sized double bedroom and did not require any structural alterations however it did house the gas meter which was removed completely and the consumer unit which was relocated to the communal hallway for practicality reasons.
The room was measured and re-designed to suit student living and maximise space, ensuring plenty of storage, a great study area, sockets and switches all conveniently located, along with attractive long lasting furniture fitted.
The bathroom was stripped out and replaced making use of the extra room created by removing the laundry appliances to the kitchen. The extra space was also utilised to house the new hot water system.
To the first floor the existing staircase into the loft room was taking a significant chunk of space out of the first floor front bedroom, meaning what should have been the biggest room in the house was actually now the smallest. In order to restore this room back to its original size the staircase needed to be moved. Given the loft room had restricted headroom in some areas and a rather suspect floor structure, the solution was to remove the first floor ceilings/loft floor completely and rebuild it with new timbers slightly lower than before, while relocating a new space saver staircase at the same time. Although a significant undertaking this would give peace of mind that not only was the new loft room structurally sound and compliant with Building Regs, but it also increased the usable floor space of two bedrooms making them both much more desirable from a lettings perspective.
Student properties often suffer from condensation problems due to the intensity in which they are occupied and exacerbated by a lack of ventilation, irregular use of heating, poor insulation and inappropriate construction.
When designing our projects the end user is always taken into account. For this project all external walls of the property were lined with insulated foil board, ensuring no cold spots on which condensation can form, as well as retaining maximum heat in the property and reducing significant fluctuations in temperature. In the kitchen a high efficiency vented tumble dryer was installed to ensure occupants don’t dry their clothes on radiators and moisture is extracted out of the property as quickly as possible. Motion sensor lights were installed in the bathroom so the extractor fan automatically switches on when someone enters the room, again reducing the chance of moisture building up in the property along with saving energy by not being left on when the room is empty.
The environmental impact of student living is a big issue for us at Varcity, and with every project we undertake we endeavour to reduce the environmental impact as much as possible and save our tenants and landlords money on future running costs. In this particular project the existing gas supply was removed and electric heating/hot water systems were installed to ensure that the property could be run on a renewable source of energy rather than fossil fuels. Although more expensive to install initially, the additional insulation that was installed throughout the property will not only reduce the ongoing running costs for years to come, but also reduce maintenance costs due to a reduction in any condensation build ups.
To finish the job properly the front of the property was re-rendered with a silicone based system ensuring no penetrating water ingress, and finished off with a contemporary composite front door to maximise kerb appeal and improve security. The whole project took 3 months and was conducted over the summer in time for tenant occupation in September. The property was pre-let off plan by our lettings team 6 months prior to the work being conducted.
The total cost of the project including purchase price was £208,000. After completion of the refurbishment works the valuation of the property by the mortgage provider stood at £180,000. This allowed a 80% loan-to-value mortgage on the property valued at £144,000 to be obtained, which, when deducted from the total costs, gave a cash cost to the investor of £64,000, delivering an annual return on cash of 26.8%.
The annual cost to service the interest only mortgage of £144,000 at an interest rate of 3.5% was £5,040, when mortgage costs are subtracted from the net rental income an annual cash surplus (prior to any other costs) of £12,140 was achieved.
These figures are an approximation of the kind of returns we are looking to achieve when you invest with us. Management and maintenance charges are additional costs that are not considered in the aforementioned figures. A guide to our management fees are set out in our price list which can be found here.