Is Empty Properties the Most Overlooked Strategy By Investors in the UK?

Discussion in 'Property Market News and Trends' started by Andrewlaville, Jun 17, 2018.

  1. Andrewlaville

    Andrewlaville New Member

    The UK faces a housing shortage crisis and neither the government nor the private sector are doing enough to keep up with the demand for new properties. The demand is increasing every year and urgent action needs to be taken to get individuals and approximately 78,000 families that are living in temporary accommodation into more permanent homes.

    Recent reports suggest the following:

    -More than 300,000 properties lie empty across the UK
    -276 of the 418 local councils show that there are 216,000 homes which have been empty for 6 months or more
    -11,000 of these properties have been empty for more than a decade
    -The issue of empty properties has been described by Vince Cable the leader of the Lib Dems as being a “National Scandal”
    -These properties lie empty for various reasons such as the owners having moved abroad, tired landlords or the owners believing that the property is unsaleable due to its poor condition.

    In most cases, the owners are looking for a way out in order to move on with their lives. Unsure of what to do, many believe that the best option is to leave the property empty until they work things out and can come up with a solution.

    Empty Property Owners Face Pressure From The Government

    The issue of empty properties has been described by Vince Cable the leader of the Lib Dems as being a “National Scandal”. Burying their heads in the sand may have been a solution for the owners in the past. However, with the well-publicized crisis of the housing shortage as well as empty properties playing out in the media, the owners are feeling more pressure to do something about those properties. Local Authorities are applying pressure more frequently by using their powers too. For example, they are using CPOs Compulsory Purchase Orders to confiscate the properties from these owners and putting them back into use.

    What does the scale of Empty Properties mean for investors?

    Opportunities! As there is an army of investors in the UK looking for great deals, I believe that there should be “No house left behind”. The neglected properties need some TLC too. There are plenty of deals out there to be done and this is an opportunity that has been overlooked by many investors.

    A great source for finding Below Market Value Properties

    Due to many of the properties being in poor condition, there is always room to negotiate on price and add value to the properties when purchasing them

    When buying property below market value, you protect yourself against the market in the eventuality of house prices falling. If you had paid the market value at the time of your investment, any fall in value would translate into a loss

    Another advantage is that cash flow is usually higher. If an investor buys a property with a mortgage, the less you pay for the property the less your repayments will be
    Locating the owners is easier than you may think

    -Speak to the neighbours and ask for details about the owners
    -Check who the owners are on the land registry, you may just get their current address to send a letter out to them
    -Hire a tracing company to locate the owners, this will cost you but buying the property will be more than worth it.


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  2. SteveK

    SteveK New Member

    Sounds interesting, how do you find them other than driving around town looking yourself?

    Can you do a freedom of information request to get a list from the local council? Or do the council simply give out the details if you ask?
     
  3. Andrewlaville

    Andrewlaville New Member

    There are quite a few methods that we use including driving around looking for properties.

    One of the best methods that works for us is to utilise people already on the ground. Such as leafleters, postmen and delivery drivers. These individuals often come across empty properties daily. By coming to an arrangement with them, they can prove to deliver a steady supply of empty property leads.

    Councils are hit and miss, some will provide you with this information and others are strongly against it.


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  4. SteveK

    SteveK New Member

    I see interesting approach. Can any of it be done from the desktop in order to automate things?

    Also, is there a list of such properties for an area that investors can subscribe to?
     
  5. Andrewlaville

    Andrewlaville New Member

    You could use a method that we call Surfing for Sterling. You use google street maps
    to go through streets instead of you physically being there. The first thing you want to do when selecting an area to "Surf for Sterling" is to check that the Google Street Maps images are up to date. For example, if the images are from 2016 then they are now irrelevant.

    Scroll through the street maps and look out for signs of distress. When you find a property, make note of the door number and add the property to your list. If it is unclear what the door number is, then look at the door numbers of the properties on both sides the property and you will be able to determine the number then.

    Street Maps also allows you to check the period of time the images were taken across several years typically starting from 2008. Once you have this information you will have a rough idea of how long the property has been like this for and it can help you with the negotiations when you track down the owner.

    I have seen lists before but the lists have have seen tend to be outdated.
     
  6. Paolo Agostinelli

    Paolo Agostinelli New Member

    There continue to be more and more data repositories available to real estate investors that allow the purchase of lists of vacant properties (or lists of properties by countless any metrics). Though, I find that the best leads are free....As mentioned before, speaking to the mail carrier about vacant properties, police officers about properties that they are frequently called to properties because of problem tenants (tired landlords who want to sell), developing relationships with code enforcers (you are helping them solve their problem of vacant and blighted property if you explain that you wish to purchase and rehab them and improve the community!).....While these are always great leads, I also like the vacant property lead lists because a vacant property is a symptom of some problem a property owner is having. Vacant lead lists include a wide cross section of property owners who want to sell....So, instead of targeting divorces, estates, etc....this list will have them all.
     
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