113 Cadogan Gardens, London SW3, £2m
Over 6,500sq ft, the Edwardian property has five bedrooms, six bathrooms, three reception rooms, a study, gym/games room, one-bed staff flat, all decorated in neutral shades, and a garage (roomy enough for one large SUV or two zippy sports cars). There is a paved patio garden, and residents have access to Cadogan Place gardens.
The problems: The 10-year lease means the buyer will need to be able to raise the £2m asking price in cash, as it is unlikely that anybody could get a mortgage on the property. The lease is “fully repairing and insuring”, which means that it is not enfranchisable, so there is no possibility of extending the lease and putting the house back on the market for a profit. Should the new owner need to sell, the asking price will only decrease further against market value, rather than make money over time.
The advantages: The short lease is, in effect, a long let. The Cadogan Estate was going to offer the house on a rolling one-year rental, but to avoid potential void periods has opted to sell. The cost of renting the property over 10 years would be in the region of £3.5m-£4m, according to the agent, so although you aren’t increasing your capital over time, you are getting the rent half-price. He says: “It would suit anybody looking for a large family house for a medium-term stay in central London.”
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The property could be sub-let for about £6,000 per week. If the house was sold with the freehold, 113 Cadogan Gardens would sell for about £7m.
Friend & Falcke, 020 7581 3022, www.friendandfalcke.co.uk