11 Alphabet Square, London E3 3RT

Description

Vacant six-bedroom HMO in east London. Licensing, planning use, room sizes, fire compliance and achievable room rents require confirmation.

Location

11 Alphabet Square, London E3 3RT. The full postcode E3 3RT has been used for mapping. The investment appraisal considers the subject's London/regional micro-market and property type rather than applying a single UK-wide assumption.

Investment Analysis

Investment Snapshot

Works Required

• Fire doors, alarm system and emergency-lighting compliance

• Bedroom/kitchen/bathroom upgrades where required

• Electrical, gas and heating compliance

• Decoration, flooring and common-area works

• Licensing/planning compliance and contingency

HB working works allowance: £19,200–£67,200. The range is tailored to the source description and asset type; it should be replaced by contractor pricing before bidding.

Rental & Market Context

HB working market rent is £4,500–£6,000 pcm (£54,000–£72,000 p.a.). The range reflects the subject's bedroom count, property type and local market band; it should be checked against live comparables immediately before bidding.

Sold within 5m radius

Reliable recent property-level sold comparables that were sufficiently like-for-like were not established in this pass. No addresses or prices have been invented. The GDV below is therefore an HB appraisal range with the stated confidence level and should be checked against HM Land Registry evidence before bidding.

GDV Assessment

HB indicative end value is £537,600–£672,000. The range reflects the subject property's tenure, condition, location, guide level and intended hmo income strategy. Confidence is medium; use the lower figure for bid sensitivity rather than treating the upper figure as guaranteed.

Strategy Recommendation

Preferred strategy: HMO Income. The working purchase range is £480,000–£518,400. The key decision is whether the verified legal/physical position supports the works allowance of £19,200–£67,200 and the stated income/end-value case.

Potential BRRR Position

Using a mid-point purchase of £499,200 and mid-point works of £43,200, purchase + works is about £542,400 before SDLT, auction fees and finance. A 75% refinance on the £537,600–£672,000 end-value range is approximately £403,200–£504,000. At the mid-point, about £88,800 of purchase-and-works capital remains in the deal before acquisition/finance costs. HB BRRR rating: Weak.

Flip Analysis

Illustrative scenario: purchase £499,200, works £43,200 and approximately £52,032 for acquisition, finance/holding and selling costs. Total working cost is about £594,432 against a mid-point end value of £604,800, giving an indicative pre-tax margin of £10,368 (1.7% of GDV). On these assumptions the flip is marginal/weak and should be rejected if survey findings or bid competition erode the margin.

HMO Analysis

Verify the existing HMO licence, planning/use class, room sizes, fire doors, alarm and emergency-lighting systems, kitchen/bathroom ratios and management standards. Room-rent assumptions should be tested against the local HMO market and void/utility/management costs, not only gross headline income.

Investor Risks & Due Diligence

• Read the full Strettons legal pack and special conditions, including administration/buyer fees

• Verify title, tenure, lease length, occupational agreements and vacant-possession status

• Inspect condition and replace HB works assumptions with surveyor/contractor evidence

• Confirm finance and insurance availability for the exact asset type

• Re-check current rents, ERV and sold evidence immediately before bidding

• Verify HMO licence/planning and fire-safety compliance

Maximum Bid Analysis

Guide £480,000+. HB considers the deal strongest around £480,000–£480,000. Above approximately £480,000, the conservative end-value/refinance margin starts to weaken materially. This is an investment sensitivity indicator, not a valuation or instruction to bid.

Recommendation

Overall HB view: HMO Income. Risk: High; analysis confidence: Medium. The principal sensitivity is end value, rent and works cost. Proceed only if the legal pack and physical due diligence support the assumptions above and leave an adequate contingency.

Strategy Rating

HMO Income: ★★★★☆ | BRRR: ★★★☆☆ | Flip: ★★★☆☆

Research Sources

https://www.strettons.co.uk/auction-residential-property-for-sale/6-bedroom-house-for-sale-in-11-alphabet-square-london-e3-3rt-6a8821bccf4bc9ebb1c9e99f/ | https://www.strettons.co.uk/auctions/current-catalogue/ | https://ggfx-strettons.s3.eu-west-2.amazonaws.com/i/STRETTONS_100926_v3_a0b7eba637.pdf