Strategy. Lease Option

Location. Salford

Personal Portfolio 

Financial Overview

Agreed purchase price (within 5 years)

£95,004

Deposit paid now

£7,500

Solicitor Fees Vendor

£500

Solicitor Fees Buyer

£600

Gas/Electric Checks

£150

 

Monthly Cashflow

 

 

Rental Income

£600pm

Mortgage

£164.08

Service Charge

£76.77

Ground Rent

£17.29

Letting Fees

£32.50

Cashflow

£334.36

Yearly net Income

£4,012

Estimated capital Appreciation

32.0% (5 years) from current valuation (£105,000)

£138,915

Estimated capital appreciation over 5 years

£43,991

Rental profit over 5 years 

£20,061


TOTAL PROFIT OVER 5 YEARS

£63,972

This property was was sourced using gorilla marketing techniques.We had placed a number of postcards in shop widows and take aways in the area. After a few weeks of no calls we were contacted by a landlord who was fed up with his rental properties and wanted to sell them.

After reviewing his properties we quickly discovered that he needed to sell them for very close to the market value which would not be very profitable as a investment. 

Rather than walking away we decided to get creative and suggested a lease option would be the best solution for both parties. This allowed the vendor to receive a up front cash instalment and allowed us to 5 years to make money through renting and hopefully capital appreciation. 

 

This type of strategy takes a lot of face to face time in order to fully understand what the vendor needs. Only then can you create a truly win win solution. We feel that we were successful in creating such a scenario.