SCAM ALERT!!!

Heres a FB snippet from a local investment company.

RESI HOUSE TO 6 BED ALL ENSUITE HMO DEVELOPMENT OPPORTUNITY IN STOKE-ON-TRENT. (Photos attached are current floor plans, proposed scheme floor plans and some photos of our finished products).

Hey all, I’ve got a deal here. Its a 3-bed mid terrace house near the University Hospital, which we are going to convert into a 6 bed all ensuite property under Permitted Development. I personally own several HMOs in this area and it’s one of the prime locations in the city for doing a high-end HMO. Professional tenants mainly hospital workers.
We’ve been managing it as a BTL for the last few years as it as an R2R and the option holder has done a runner, and we have taken over the option and we are exercising the option to buy of 115k, and now the landlord wants to sell and so we are DTV on this deal. We are still ‘letting’ it but it’s vacant and will remain vacant until it’s been fully developed into a 6-bed HMO.
Similar properties are selling for around £170,000, on the same street. This is £115,000.
It needs a lot of work doing to it, the renovation has been fully Quantity Surveyed and our main contractor who has done over 50 projects for us will be taking the lead on the build.
We can start immediately on this project, after completion. It will take approx 22-25 weeks to complete fully and tenant.
Our ensuite rooms in this area get £425-495 pcm, and our occupancy rate for this area is extremely high all year round.
Some headline figures:
Purchase price: £115,000
Renovation: £78,000
Furniture: £12,000
Rental Income: £2,517 (includes 5% void contingency but our occupancy rate is 99%). ***END***

So they want you to buy @115K then spend 78K on conversion from 3  rooms to 6  rooms with en-suites plus £12K on furnishing, not to mention loss of rent for 25 weeks. So a total spend of 205K to achieve 6 rooms @£425 to £495pm.

First of all id like to know where they are getting their furniture from, i say £12,000 what are they furnishing?

Now the odd thing is i can buy 2 houses for you @85K each so giving you a total of 8 rooms and far less headache with HMO compliance and you will gain similar rents and benefit from growth on 2 houses, and your 2 houses will be kept as they are houses so when you want to sell you can sell to anyone.

The reason they get investors to part with so much is basically they will make around 20K plus on the deal then they will manage it for you. The deal sounds too good too be true hey, price 115K and similar properties on the street selling at 170K whys he passing it on? Buy it yourself spend a few quid on it and flip it, by the looks of those figures you should make around 50K plus.

They offer you between £425-£495pm well blow me over I’m getting similar rents on a 3 bed i picked up for 72K with a total spend of 4K. If the market was regulated they would not be able to get away with it, this is high risk and your get out options are very limited.

Today one of my investors has just made an offer on a property that was up at 90K, in order to secure the deal i advised an offer of 85K on the viewing, as the property was a bargain offering 4 double rooms and in the most perfect location like 5 minutes of J15 M6 and right in the middle of the distribution hub within the city.

Offer accepted at 85K on the day and I’m aspecting an annual rental income of no less then £18,200 gross and these rents are average compared to other rooms within the city. I also expect the property to gain value over the next 5 years so our client will benefit from a great rental yield as well as capital growth, win win situation.

We believe in keeping everything simple and only source properties that require minimum updating.

If your not investing with me then your losing money.

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