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william_s

First property - potential CPO maximise profit?

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Hi all, 

 

ive recently purchased my first house in London.  Lucky enough to get a 3 bed terraced with garden for 400k on a commuter line, which is valued up to £420k. 

 

Now that’s where the trouble starts, with it being literally on the commuter line!  I’ve found out that network rail are considering expanding the train tracks at the rear of the garden adding two new lines.   This means that the will be issuing a CPO in a few years against at least half my 20m garden, maybe even the whole house as a worst case.  

 

My intention has always been to use this as a starting ground for buying more properties to rent out and eventually retire on.  

 

Now im wondering about how I can best release the potential with this CPO on the horizon.  On the one hand I was absolutely GUTTED but I have to make the most of it!  With a CPO they will pay house for all damages, land taken, house value, inconvenience etc etc and it’s based on current value of the property, so my thinking is to maximise the value of the house in as short time as possible!   Timeline for the works is initial plans may 2020, funding 2021, and CPO 2022

 

The house is a 3 bed terraced from the 9030s and has been extended beautifully downstairs. My plan is to self build a garden office to add some value as was always the plan. 

 

The loft has potential to be extended with a dormer for a master suite and bathroom. This would cost £40 and houses in the postcode are then selling for £500-520k with the 4th bedroom so this is a no brainier!! 

 

The trouble is I’m not sure how to best finance this and what the options are?  I’ve basically got 1-2 years to sort this and buying the house has taken all savings for a while! 

 

Out joint income is pretty good (100k) but we are maxed out for the next year at least!  Also we have a 95% LTV mortgage so not much flexibility yet! 

 

Any advice for clever ways to finance this kind of build or anyone with experience with CPOs would be really appreciated.  

 

Thanks!! William 

 

 

 

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This just doesn't happen "suddenly".

Someone has not done their searches correctly.

But, just so I understand, you want to maximise the value of your property, in around a year or so, knowing that a CPO is on the horizon and, basically, betting on the fact that they value it how you want it to be in a blighted area?

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Hi Dennis, 

 

Well as I say the project is currently unfunded has not been in the public domain so it did not appear on searches, but I arranged a meeting with network rail last week and they believe it will be going ahead once designed are approved next year.  

 

Essentially my understanding of the CPO (If subject to the whole property purchase) process is that a payout is based on market value before any works have taken place.  

 

Network rail told us to continue with all our house plans, so the idea is to maximise the value of the house to then Leverage that during the CPO process in 2-3 years 

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