A Tale of Two Property Transactions The Tortoise and The Hare
Hi Everyone,
I hope you had an enjoyable weekend with your families wherever you are in the world.
I was working during the weekend as I know that this week will be a stressful one, and Monday so far has not disappointed in terms of stress.
I have 2 ongoing property purchases heading towards completion this week.
The first transaction started in October 2023, yes 2023, when my offer to purchase a Grade II Listed building was accepted. I have written about this here before but I never imagined that a year later I would still not have actually purchased the building (the process is ongoing).
On 19th January we submitted a planning application to the Local Authority and they duly considered the application, and finally approved the application on 12th June 24.
We were then obliged to complete quickly within 30 days, which has been impossible.
Contrary to popular opinion, we found that investor funds are not so easy to get hold of and commercial funding can be slow and an onerous process.
So we secured funding in July and have been progressing with the purchase, which has become a marathon event of interactions between our solicitor, the lenders solicitor and the sellers solicitor.
Compare this with the other building that we are currently acquiring, where the vendor accepted our offer only at the beginning of October 24, yet we have made very fast progress, and are likely to exchange contracts later this week, ie within 4 weeks.
It is like the tortoise versus the hare.
The first transaction is frustratingly slow and by comparison the second one is flying.
Why is this the case?
It all comes down to risk appetite of the involved parties.
The first one has been slowed down by the planning process, 4 months, since the offer was subject to planning permission being granted to convert into flats, followed by the funders requirements which are quite onerous, in terms of due diligence.
On the other hand the more recent purchase is unconditional, so there is no planning permission process or delays involved. We are using investors funds for the purchase deposit , so no due diligence is involved beforehand.
So the later purchase has more risk for me, however the potential upside could be greater.
This is all work in process, so I'll let you know in a future post which one wins the race, the tortoise or the hare.
Have a fantastic week ahead everyone!
Cheers
Alan
Recent Comments
1
Great to hear that you are on the path to great opportunities, growth, and wealth. I'm praying that the hare wins.
Rick⍢