Front elevation
Latest Valuation
£165,000
Yield
9%
Selling Agent
Sourced Glasgow South

HMO/Serviced Accommodation Investment Property

Off-Market Refurbishment Property in the Scottish Borders
Guide Price
£138,000

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Key Features

  • 9% Net Yield
  • University Town
  • Town Centre Location
  • Local Amenities Nearby
  • Good Transport Links
  • Only 35 Miles from Edinburgh

The Property

Off-market 7 bed property previously operated as a B&B. It has a large kitchen/diner, 6 WCs, an existing fire suppression system and its still classified as a commercial property, so there's no need to apply to change its use.

It's a 7 bedroom property, which could be easily reconfigured to give 9 bedrooms. It's situated on a first and second floor above 2 retail units in a town centre location.

The plan is to refurbish the property to a good standard, re-configuring the layout to give 9 bedrooms and let the rooms to students and contractors, with the option to rent the rooms on a SA basis to tourists also, particularly in summer months.

The property is located in Galashiels town centre. Galashiels is a busy university town in the Scottish Borders, 35 miles from Edinburgh. As well as having a student market, the town has many contractors and
tourists visiting regularly.

The Financials:
Total cash investment required: £188,000
Purchase price: £138,000
Valuation: £165,000
Net yield: 9%
Refurb cost + fees etc: £10,000 - £35,000
Student rental (7 beds for 9 months): £18,900 pa
9 bed configuration: £26,325 pa
AirBnB per annum: £5,000 - £8,000
Monthly costs: £1,000 - £1,200
Monthly optimal profit: £1,660
Potential gross income: £31,356 pa
Positive monthly cashflow: £1,000+

Average room rates in the area are £300-£350 pcm. There is also the option to rent the rooms on a SA basis to tourists and short stay visitors, particularly in summer months, while the students are away, this could achieve an extra income of between £5,000-£8,000 during the 3 summer months.

Planning Information

N/A

The Plan

To refurbish the property to a good standard, re configuring the layout to give 9 bedrooms and let the rooms to students and/or contractors.

Average room rates in the area are £300-£350 pcm. There is also the option to rent the rooms on a SA basis to tourists and short stay visitors, particularly in summer months, while the students are away, this could achieve an extra income of between £5,000-£8,000 during the 3 summer months.

The Location

With a population of 12,000, the town offers a full range of shopping and leisure facilities.

Local tourist attractions include Old Gala House and Abbotsford House, the former home of Sir Walter Scott, with its award winning visitor centre as well as many other attractions in nearby Melrose and other Border towns.

There are also a variety of outdoor pursuits in the area that include fishing on the River Tweed, fieldsports, horse riding, golf, lawn bowling, mountain biking, and a selection of walks including the Southern Upland Way.

Average estimated value for a house in TD1

£297,942

Average room rates in the area are £300-£350 pcm. There is also the option to rent the rooms on a SA basis to tourists and short stay visitors, particularly in summer months, while the students are away, this could achieve an extra income of between £5,000-£8,000 during the 3 summer months.

The property is fairly unique and there is not like much else similar in the area. There is a 6 bed family property on the outskirts of Galashiels with a HR valuation of £230k, its listed at £200k fixed price.
There is also a 6 bedroom B&B in the area which is closer from a use case point of view, its listed for sale at £245k - https://www.rightmove.co.uk/commercial-property-for-sale/property-81317450.html

There have been 21 detached property sales in the last 12 months, the average price paid for a detached property is £257,380 and the current average value for detached properties is £297,942.