July 16th, 2018. Luke Egan
Are Abandoned Properties a Good Opportunity for Developers?
According to research by the Liberal Democrats, figures from 276 local councils have revealed there are more than 216,000 homes across the UK that have been empty for six months or more. Furthermore, 60,000 properties have been empty for the last two years, 23,000 for five years, and there are 11,000 properties that have been empty for 10 years or more.
The areas with the highest number of empty homes include:
• Durham – 6,500
• Leeds – 5,724
• Bradford – 4,144
• Cornwall – 3,273
• Liverpool – 3,093
The research also found that councils are not utilising Empty Dwelling Management Orders (EDMOs) which allow English and Welsh councils to take over residential properties that have been empty for six months or more. In fact, just 18 out of the 247 councils that responded to the Freedom of Information request had used an EDMO in the past five years.
However, if these abandoned properties were for sale, would they provide a good opportunity for developers?
Does This Provide Developers with Opportunities?
If councils are not utilising EDMOs and properties are left empty, they will likely become tatty and degrade with time. However, if they were sold, they could be rejuvenated and do their bit to fight the growing UK housing shortage.
So, purchasing one of these long-forgotten properties and doing it up could be a great moral win, but is it a financially sound idea? Well, that greatly depends on the property in question.
If a property is relatively structurally sound then it may prove more affordable to simply renovate it and stick it on the market. This could include anything from a lick of paint to a two-storey extension depending on the budget you have, the size of the plot, and the types of properties which prove popular in the area.
However, if it is obvious the property has some major issues, it may simply make more financial sense to seek planning permission and tear down the existing property to create a building plot. Heck, you may be able to fit multiple new homes on the same plot of the old home.
5 Abandoned Houses for Sale Right Now
(correct as of July 2018)
1. 4 Bedroom Detached House, Cumbria, £250,000
Found in Oddendale Hall, Penrith, Cumbria, this spacious property marketed by Property to Renovate offers the opportunity to develop a derelict Grade II listed farmhouse and 3,000 sq. ft. barn. There are currently three reception rooms and four bedrooms in the main house, and a nearby paddock too.
2. Chapel, Carmarthen, £120,000
Also listed with Property to Renovate, this derelict chapel on 2 acres of land is in a stunning rural location and could make an ideal project subject to planning consents.
3. 3 Bedroom Detached House, Warwickshire, £1.1m
Admittedly, this sounds a lot for a three-bedroom home that needs to be completely gutted, until you realise it comes with 13.62 acres of land. Located in a popular village, this derelict property marketed by Andrew Grant provides a great opportunity to developers.
4. 1 Bedroom Detached House, Dunoon, £175,000
GSPC Ltd currently have this unique abandoned property for sale in a secluded area near a main road. There are two dwelling units with consent for the nearby barn to be converted into a third unit.
5. 3 Bedroom Semi-Detached House, Cornwall, £395,000
Stags Launceston currently have this three-bedroom, two reception room empty property for sale which comes with a range of agricultural buildings, including a barn, as well as a whopping 37acres of land.
Need Finance for a Development Project?
Whether you opt to do up one of these abandoned homes for sale or you go down a more traditional property development route, our experienced team of brokers can help you find the perfect property development finance deal for you.
Get in touch today by calling 02920 766 565 to see how we can help.
Article By Luke Egan
July 16th, 2018
Luke heads up our specialist property finance team where his focus is to drive our transactions valued between £100k and £5m.
Luke and his team manage enquiries from initial enquiry through to redemption. Luke also sits on the internal credit committee with Ben and Tom.
Luke joined Pure back in 2014 following a successful role in the Barclays property finance team that lasted over 8 years.See more articles by Luke