The Daily Arsenal

Yes those ramblings mate, the ones where you've been exposed time and time again for talking utter bollocks

 

You're forgetting one thing Tobes.

Wait there while I google what that one thing could be.

 

That's all fine and dandy, Tobes, but if the property goes on the market it won't actually sell for £600k. More likely, it would sell for £450k.

Plus, the figures we're working to are extremely conservative. We cost high, and price low. If, in 9 to 12 months time (when the units have all been completed), the local property market is as strong as it is now, we could add another 20% to the profit.

A final wrinkle is that my builder partner believes that he can squeeze a couple more flats in the main building (the conversion element of the project) with a simple application to amend the existing planning consent, which would add approximately another £100k to the profit.

In short, there are several reasons why we would want to build out on this project as opposed to turn it.

 

Right, I've got it.

You're forgetting one thing Tobes and that's the fact that HIAG is a clueless fake lawyer who was plucking figures out of the air that he thought looked impressive but now realises that he can't do basic financial arithmetic.

I bet you feel pretty stupid now Tobes, especially as HIAG is being sucked off by his business partner in front of his favourite episode of Homes Under the Hammer.

HIAG played Homes as his business partner is a big West Ham fan.

 

I'm wounded that you think so lowly of me, Pixie.

Oh, wait! No. Actually, I really not.

 

This English language lark really does tax your brain, doesn't it ?

 

Ah, yeah, I see that in my haste I forgot to type the word "am" in my last post.

That's my dignity gone.

 

I hate to break it to you, but you threw that out a long time ago on here mate.

 

Oh right mate I see...

So the true market value is in fact £450k, but your lender has valued it at £600k and are going to lend on that figure. (As stated in post 776)

So for that to be true your lender has overvalued the property by 30% and has lumbered themselves with an exposure of a £150k loss.

That sounds plausible

 

Why did you say that the property's value is £600k if it will only sell for £450k?

Surely its value is £450k if that's what it will sell for.

I'm beginning to think you're the estate agent pal!

Be careful not to incur (additional) s106 costs by going for two extra units. Actually let's not revisit that.

 

BOOM TISH!

I set 'em up and you knock 'em down, eh, Pixie!

Jimmy Krankie would be proud of your, sunshine!

 

It was HIAG's nonchalant shrug of the shoulders when they asked him to run through the project financials that convinced them that he was a safe bet. If only they'd seen the three wheeled van illegally parked out front.

 

Jimmy Krankie would be proud of my sunshine ? WTF are you blathering on about now ?

Have you been drinking or do just always come across as a sandwich short of a picnic ?

 

We are confident that the lender's valuation will come it at around £500k - £600k.

Whether it would actually fetch that on the open market no one can actually know unless and until it was placed on the market.

What we do know is what 2-bed flats and 3-bed houses sell for in our locality.

There's no need to get defamatory!

Oh, dear, Stan! You've made a bit of a faux pas, there! This is a conversion of a former public house. Do you want to revise your comments regarding s106? I'll give you a minute to think about that one.

 

He's that safe a bet he doesn't even know if he's buying it from the owner, the bank or the receiver, how much the actual true net value is! and the total value of the project has a variable of nearly 20%.

They must have been impressed like.

 

Mate that can't be true. The lender's surveyor can ONLY value property or land based on comparables. Either he'll have them or he won't. If he does, then there is absolutely no reason it wouldn't fetch that amount on the open market BECAUSE comparables are based on what's actually sold in the open market already. Unless you're mystic meg and are predicting a recession in the next fortnight?

 

Maybe he's hoping the valuer uses the same back of a *** packet calculations that he does.

Here's a thought. They could well value the property on the price that it's changing hands for.

 

I know HIAG struggles with words and images are more his thing. So I thought I'd post this visual representation of HIAG's contribution to this debate:

please log in to view this image

 

**** me! This is like wading through treacle!

Go and do a deal yourself, Trebs, with people who know how to play the game, and you'll get the full picture.

Just because a lender values a property at a certain price, doesn't mean the property is definitely going to get that price.

I think the property will value up at £500k, and that I can knock the bank down to £250k to clear its mortgage.

Which ever way you look at it, it's going to be better for us to build out than to turn, especially as I have the area's best builder who is itching to get started. Yes, there is always a risk with these things, but that is why we cost high and price low.