This investment opportunity comprises two substantial adjoining Victorian terraced houses, that have been adapted to provide a fully licenced 7 bedroom HMO in each property (so 14 in total), laid out over ground, first and second floors. The properties currently have shared bathrooms but there is potential for installing ensuite bathrooms in most of the bedrooms, which provides an opportunity to significantly increase the rental income.
The properties are constructed in solid brickwork under a pitched tiled roof, with pedestrian access from Monks Road. There is a small car park to the rear as well as on street permit parking on the surrounding streets. Cycle and bin storage can be found to the front of the property where there is a small forecourt. The property has been attractively adapted and is well presented throughout.
EPC ratings - 155 Monks Road - D and 157 Monks Road - E. These EPC ratings both expire 3rd April 2029. Recent works undertaken by the Vendors will have improved these ratings if new EPC assessments were undertaken.
Lincoln is the administrative and main shopping centre for the County of Lincolnshire, with an estimated urban population of circa 130,000 and a catchment of 545,000, generating an estimated total catchment spend of close to £1 billion per year.
It is recognised as one of England’s finest Cathedral Cities, attracting over 3 million tourists every year.
It is also a growing University City with close to 20,000 students and staff attending or working at the University and other higher education Colleges around the City, including Lincoln College and Bishop Grosseteste University, which combined contribute an estimated £250 million into the local economy every year.
The property itself is situated on Monks Road about ½ of a mile to the east of the City Centre, in an area that is popular with Students. The property over looks the Arboretum to the North, which is a 19th-century 22-acre park, with lovely gardens and ponds. There is a good range of local amenities nearby including a Coop C-store and Post Office, a Pharmacy and a variety of local independent retail shops and takeaways.
The property is also located just over a mile from the main Lincoln University campus on Brayford Pool and less than ½ a mile from the main Lincoln College Campus, situated at the western end of Monks Road, close to where it joins Broadgate.
Rental Income/Current Expenditure
The property has been generating a gross income when fully occupied of over £60,000 per annum. We would anticipate this increasing to circa £84,000 per annum following completion of the work to create ensuites in the majority of bedrooms. Expenditure is currently running at just over £20,000 per annum which would indicate that with the bathroom conversion work completed, the investment will generate a net rental income of around £64,000 per annum. Further information around the income and expenditure is available on request.
The property is a fully licenced HMO which is a use falling within Class C4 of the Town and Country Use Classes Order1987 (as amended in 2020). The building is not Listed but is located within a Conservation Area.
The property is being sold Freehold, with vacant possession, in order to allow a purchaser to undertake the works to create the en suite bathroom and generate a higher rental income.
We understand that all main services are available and connected to the properties. None of these services have been tested and interested parties are advised to make their own investigations with the relevant utility service providers.
Both properties fall within Council Tax Band B.
Method of Sale
The property is being offered for sale by way of private treaty.
We are inviting offers in the region of £675,000 for the Freehold interest in the property. Based on the projected region rental income above this would provide a purchaser with a Net Initial Yield of 7.5% after allowing for a cost of £75,000 to undertake the bathroom work. The purchase price reflects a low capital value rate of £50,000 per bed space.
VAT may be charged in addition to the purchase price at the prevailing rate.
Each party is to be responsible for their own legal costs incurred in documenting the transaction.