The Viewing That Saved £25,300: Why I Walked Away From a Wath upon Dearne BRR

On the spreadsheet, this house returned every penny and £100,000 more. In person, it would have left over £100,000 stuck in the bricks. The difference was one viewing and an hour with the sold prices.

The opportunity on paper

A 4 bed semi in Wath upon Dearne, listed at £160,000. The plan was buy, refurbish, refinance into a 6 room HMO. The listing gave a floor area of 2,411 square feet.

Price a house that size like an ordinary semi and the end value comes out at around £460,000. Refinance at 75% and over £100,000 comes back out on top of everything that went in.

It looked too good. That is exactly why I viewed it in person before it went anywhere near an investor.

What the viewing found

• A crack running down from above a window, plus a stepped crack in a bedroom. Signs of movement, so a structural engineer before any offer
• An old Artex ceiling that had to be tested for asbestos before anyone touched it
• Damp, with plaster blistering above the skirting
• A leak along the boxing, with black mould on the skirting below
• Electrics needing a full rewire

None of it was on the listing. Priced up, the hidden works came to £22,000. With a 15% contingency, that is £25,300 added to the cost.

What the sold prices said

Then came the bigger problem. Not one semi within half a mile had sold at anywhere near 2,411 square feet. The genuinely like for like semis, at 1,000 to 1,200 square feet, sold for £120,000 to £245,000.

The listing's floor area didn't match anything on the street. A lender's surveyor would value the house against those real sales, not against a number on a brochure. The cautious end value was £215,000, not £460,000.

Desk appraisal against reality

• End value: around £460,000 on paper, £215,000 after the viewing and sold prices
• Refinance at 75%: around £345,000 on paper, £161,250 in reality
• Hidden works with 15% contingency: not known on paper, £25,300 in reality
• Total money in: around £238,450 on paper, around £263,750 in reality
• Result: around £106,550 back out on top on paper, £102,500 left in, in reality

The house didn't change. The evidence did.

The decision

At £215,000, more than £100,000 would have stayed tied up in the property. Even 15% off the asking price still left over £76,000 in. So I walked away.

That decision is the service. An investor who had bought this from the listing and the spreadsheet would have found out at the refinance, when it was far too late.

What I check before any viewing is booked

• The floor area on the energy certificate, against the listing
• Sold prices for the same type of house, same bedrooms, similar size, within half a mile
• Whether the end value works on the cautious end of the evidence, not the best sale
• Planning and licensing for the intended use, such as an HMO
• What the photos avoid showing: ceilings, corners, the outside of the house

What I check on the viewing

• Cracks, and which way they run
• Damp, leaks and mould, and where they are coming from
• The consumer unit, the boiler and the age of the pipework
• Ceilings and textured coatings that may need an asbestos test
• The roof, gutters and outside walls

The lesson

A spreadsheet can make almost any house work. The viewing and the sold prices decide whether it really does. For one that did work, read the Rotherham terrace with under £5,000 left in.

Your next step

Every opportunity I present has been viewed, priced and tested like this first. Get your free Personalised Property Plan: a short form, then a call with me to talk through your budget, goals and the areas that suit you. Free, and no obligation.

Risk note: Figures are from a real opportunity that was declined after viewing. Every property is different, past results don't guarantee future ones, and you should take independent legal, survey, mortgage and tax advice before buying.