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Post by andrewrt on Oct 18, 2020 16:31:06 GMT
We're three days into the block listing for three properties that have reached their anniversaries and restarted the process post-lockdown. Existing investors opted to sell 33%, 36% and 50% respectively - lower than I expected given the discounts available on the secondary market and the uncertainty with a property sale.
3 days into the 14 days process and the listing has filled 2%, 1% and 3%.
I would expect to see a peak in interest at the start (FOMO) and end (Existing investors protecting their investment). But these figures look like they'll miss the target and will become the first actual 5 year anniversary sales.
On the positive side, if they manage to sell near their exit price that could boost the secondary market.
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beh
Member of DD Central
Posts: 175
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Post by beh on Oct 18, 2020 19:38:49 GMT
On the positive side, if they manage to sell near their exit price that could boost the secondary market. Aye, always felt it'd be necessary to see the valuations tested on the first few.
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Post by scepticalinvestor on Oct 19, 2020 14:52:31 GMT
I'll be watching with interest, especially the Whitechapel flat. I imagine these 3 properties will take a good few months to unload at the current (imho excessively high) published valuations.
Maybe I'm missing something obvious, but where do I see the date of the most recent valuation for the 3 properties on the chopping block?
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Post by andrewrt on Oct 19, 2020 23:13:47 GMT
I'll be watching with interest, especially the Whitechapel flat. I imagine these 3 properties will take a good few months to unload at the current (imho excessively high) published valuations.
Maybe I'm missing something obvious, but where do I see the date of the most recent valuation for the 3 properties on the chopping block?
They're shown in the "investment case" sections. From what I can see they were last revalued in September 2020.
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Post by andrewrt on Oct 24, 2020 11:29:00 GMT
3 days into the 14 days process and the listing has filled 2%, 1% and 3%. 11 days in and it's barely changed - still at 2%, 1% and 3%. Safe to say all three are heading for the exit. Best outcome in my view - property market is red hot right now with the stamp duty set to expire early next year. I'm hoping they get a quick sale, crystallize some of my profits (and cap the losses) and - most importantly- put a floor under the secondary market.
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Post by scepticalinvestor on Oct 26, 2020 11:34:54 GMT
3 days into the 14 days process and the listing has filled 2%, 1% and 3%. 11 days in and it's barely changed - still at 2%, 1% and 3%. Safe to say all three are heading for the exit. Best outcome in my view - property market is red hot right now with the stamp duty set to expire early next year. I'm hoping they get a quick sale, crystallize some of my profits (and cap the losses) and - most importantly- put a floor under the secondary market.
I'm not sure it'll necessarily be a quick sale though, or make the 31st March deadline (less significant for the non London properties I guess).
Taking the Whitechapel flat as an example. The property will be marketed only once vacant posession is obtained (maybe the property is already empty? I don't know). In their own words "Properties will therefore be marketed for sale when the tenant has left and the property has been prepared for sale. As a result, there could be a period of months between the conclusion of the block listing of shares and the property being marketed for sale."
As per the mechanism described on the website, the flat will first be listed at 570k and it looks like they will consider up to 5% below asking at most, so around 540k. If offers are below 540k, then there's another shareholder vote, and so on.
Given that there are (almost) no takers for the shares offered at the equivalent of a gross purchase cost of 532k (price plus sdlt), not sure how much interest will be there at 570k sale price (with 20k/35k sdlt on top, etc).
It's going to be an interesting few months and I'm eagerly looking forward to how closely the achieved prices track the most recent valuations.
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Post by andrewrt on Oct 27, 2020 11:36:49 GMT
I was under the impression the marketing would start immediately, with offers accepted on a tenanted basis if that would give a better outcome:
"The current tenancy expired in August and the current occupants are holding over. Normally the notice period to end the tenancy is 2 months, but under the new government Covid-19 rules, it is 6 months. The tenants may choose to leave earlier, but in any event, we will pursue an immediate sale to determine the best offer achievable. The surveyor has determined a tenanted valuation of £540,000"
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Post by scepticalinvestor on Oct 27, 2020 12:21:00 GMT
I was under the impression the marketing would start immediately, with offers accepted on a tenanted basis if that would give a better outcome: "The current tenancy expired in August and the current occupants are holding over. Normally the notice period to end the tenancy is 2 months, but under the new government Covid-19 rules, it is 6 months. The tenants may choose to leave earlier, but in any event, we will pursue an immediate sale to determine the best offer achievable. The surveyor has determined a tenanted valuation of £540,000"
Ah ok, I missed that. So it looks like the intention is to market it with tenants in-situ at 540k, presumably meaning that tenant in-situ offers of up to 513k (5% less) may be entertained. Interesting. That might well end up being a realistic price.
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Post by overthehill on Oct 29, 2020 21:12:04 GMT
There is another flat in the Whitechapel building just gone up for sale, 825k. Extra bathroom, extra cupboard and 11sqm larger and a higher floor, 255k more. Don't detect any selling pessimism with that price.
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Post by scepticalinvestor on Oct 30, 2020 11:18:07 GMT
There is another flat in the Whitechapel building just gone up for sale, 825k. Extra bathroom, extra cupboard and 11sqm larger and a higher floor, 255k more. Don't detect any selling pessimism with that price.
Wow, I just checked it out. That is bl**dy crazy!
From what I can see there are 4 (four) 2-bed flats on sale in that building -
900 sqft (1 bath) at 650k multi agency with 2 EAs 900 sqft (1 bath) at 650k 1300 sqft (2 baths) at 805k 1000 sqft (2 baths) at 825k
If PP does end up listing this 900 sqft 2 bed flat at 540-570k, that'll definitely p*ss off these sellers!
PP property sales teams are going to have their hands full soon. The 3 currently on the block and 6 more hitting their 5 year anniversary in the coming month. I'm in 4 of the 9, it's a bit unfortunate that they're all flats though.
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Post by overthehill on Oct 30, 2020 19:47:30 GMT
There is another flat in the Whitechapel building just gone up for sale, 825k. Extra bathroom, extra cupboard and 11sqm larger and a higher floor, 255k more. Don't detect any selling pessimism with that price.
Wow, I just checked it out. That is bl**dy crazy!
From what I can see there are 4 (four) 2-bed flats on sale in that building -
900 sqft (1 bath) at 650k multi agency with 2 EAs 900 sqft (1 bath) at 650k 1300 sqft (2 baths) at 805k 1000 sqft (2 baths) at 825k
If PP does end up listing this 900 sqft 2 bed flat at 540-570k, that'll definitely p*ss off these sellers!
PP property sales teams are going to have their hands full soon. The 3 currently on the block and 6 more hitting their 5 year anniversary in the coming month. I'm in 4 of the 9, it's a bit unfortunate that they're all flats though.
I've got 30, it's sell and exit for me, zero trust. The new fee structure was a bombshell, the amount and the way it is structured penalises the earliest investors with large equity low dividend properties and it is certainly not the way to share the downs and ups equally. Bye bye PP. They had to come out with all this operating data now or it would have exploded when investors starting asking the questions at sale time, it is all been kept quiet till now although based on how some properties valuations deep dived into discounts I'm suspicious there were plenty of leaks. It all makes more sense now the data has been published.
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Post by longjohn on Oct 31, 2020 14:01:04 GMT
... The new fee structure was a bombshell, the amount and the way it is structured penalises the earliest investors with large equity low dividend properties and it is certainly not the way to share the downs and ups equally...
Yup, l've got properties where the deficit is so large they'll probably never pay a dividend again but PP keeps taking the aum regardless. There's no 'we are all in it together'. PP is happy to share the ups but you're on your own with the downs.
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Post by scepticalinvestor on Oct 31, 2020 20:11:46 GMT
Ugh, I've been putting off reviewing yesterday's disclosures. I kind of suspected it wouldn't make pleasant reading.
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Post by scepticalinvestor on Nov 20, 2020 19:59:57 GMT
It's the keenest priced amongst the four 2-beds for sale in that building. Let's see how quickly it goes.
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Post by andrewrt on Nov 25, 2020 23:15:54 GMT
It's the keenest priced amongst the four 2-beds for sale in that building. Let's see how quickly it goes. Surveyor said vacant possession £570k and tenanted £540k, so if it sells at, say, 95% of asking price I'd be very happy! Less than 90%, less so!
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