Investment Opportunity Brief: 38 Bampfylde Road, Torquay, TQ2 5AR

Presented by: Co Source with Tiger Burrows Ltd (Summit Property Group Ltd)

Overview

This is a high-potential property investment opportunity involving the conversion of a former guest house into a 7-bedroom House in Multiple Occupation (HMO) or serviced accommodation. Located in a desirable residential area of Torquay, the property offers strong capital growth and rental yield prospects.

Key Details

• Property Type: Ex-Guest House

• Bedrooms: 7

• Purchase Price: £290,000 (subject to planning)

• Renovation Estimate: £130,000 (including planning)

• Sourcing Fee: £6,000

• Estimated End Value:

  • £600,000 (shared bathrooms)

  • Up to £770,000 (with 5 en-suites)

• Rental Income Potential:

  • Up to £5,710/month (gross yield ~8.9%)

  • Serviced accommodation potential: £164,013 annual revenue (ADR £877, 50% occupancy)

Financial Summary

• Total Investment Required: £451,000

• Refinance Potential: Up to £525,000 mortgage

• Profit on Refinance: Up to £249,000

• Monthly Net Profit: £1,393.50

• Annual Net Profit: £16,722

Renovation Scope

• Full HMO compliance, including fire safety upgrades

• Optional en-suite additions to boost rental and resale value

• Modernisation of heating, windows, and interiors

• Utilisation of garage and storage areas for added value

Market Context

• Strong demand for HMO rooms and contractor accommodation in Torquay

• Comparable properties show high occupancy and competitive rental rates

• Agent valuation supports end value range of £600,000–£750,000

Property Layout & Reconfiguration Potential

The property spans approximately 2,120 square feet, offering substantial flexibility for layout optimization. There are two main configuration options:

• Option 1: Convert the property into 5 en-suite bedrooms and 2 double bedrooms with shared bathrooms.

• Option 2: Retain the existing structure as 7 double bedrooms, all sharing communal bathrooms.

Additional layout enhancement opportunities include:

• The top-floor toilet can be easily converted into a shower room, improving functionality.

• The smallest bedroom on the first floor could be reconfigured into either one large bathroom or two compact shower rooms.

• On the ground floor, the second reception room adjacent to the shower room presents an ideal space to be transformed into an en-suite bedroom.

These modifications would significantly increase both the rental appeal and the end value of the property.

Detailed Financial Analysis for 7 bedrooms and Shared Bathrooms

Price Offered: £290,000.00 – The price you have agreed to pay for the property
Mortgage %: 75.00% – Typical BTL mortgage is 75% - Typical Bridging Finance is 60%
Mortgage: £217,500.00 – This is the amount a mortgage company would be willing to lend
Deposit: £72,500.00 – The deposit that would be required to be funded by you
Stamp Duty: £19,000.00 – Please go to the government’s website to calculate Stamp Duty – www.tax.service.gov.uk/calculate-stamp-duty-land-tax
Legals: £2,000.00
Total Refurb Costs: £110,000.00 – Best obtained via a builder’s quote
Furniture/Setup cost: £10,000.00 – Cost to furnish and stage the property
Total Money In: £431,000.00 – Total money required to fund the deal

End Value

End Value: £600,000.00 – What will the value of the property be after you’ve refurbished it
New Mortgage Amount: £450,000.00 – New mortgage amount (assuming 75% BTL)
Money Pulled Out: £150,000.00 – Money pulled out after refinancing (assuming 75% BTL)
Profit: £169,000.00 – How much profit you will make (Please note: if refinancing, much or all of this will be left in the deal)
Money Left In: -£19,000.00 – How much money will be left in the deal, assuming you refinance on a 75% BTL mortgage

Income Gross

Monthly Rent: £4,800.00 – Average nightly rate, use online comparables
Number of rooms: Number of rooms in the property being rented (If renting the whole property: 1 room)
Occupancy Rate: % – Average occupancy rate, use online comparables
Total Income Per Month: £0.00 – Gross income per month
Total Income Per Annum: £0.00 – Gross income per annum

Expenses

Mortgage: 6.00% – £2,250.00 – Mortgage payments post refinance
Management: 10.00% – £225.00
Maintenance: 10.00% – £225.00
Council Tax: £194.00 – Check the council website
Utility bills: £400.00 – Includes Gas, Electricity, Water, Broadband, TV License, Insurance (and cleaning if paying above what guest will pay)
Total Expenses: £3,294.00 – Total monthly expenses

Cashflow

Monthly income: £4,800.00 – Total monthly income
Monthly Expenses: £3,294.00 – Total monthly expenses
Monthly Profit: £1,506.00 – Total monthly profit after expenses
Annually Profit: £18,072.00 – Total annual profit after expenses

Detailed Financial Analysis – End Value for 7 bedrooms, x5 en-suite bathrooms

Price Offered: £290,000.00 – The price you have agreed to pay for the property
Mortgage %: 75.00% – Typical BTL mortgage is 75% - Typical Bridging Finance is 60%
Mortgage: £217,500.00 – This is the amount a mortgage company would be willing to lend
Deposit: £72,500.00 – The deposit that would be required to be funded by you
Stamp Duty: £19,000.00 – Please go to the government’s website to calculate Stamp Duty – www.tax.service.gov.uk/calculate-stamp-duty-land-tax
Legals: £2,000.00 – If unsure allow £3k
Total Refurb Costs: £130,000.00 – Best obtained via a builder’s quote
Furniture/Setup cost: £10,000.00 – Cost to furnish and stage the property
Total Money In: £451,000.00 – Total money required to fund the deal

End Value

End Value: £700,000.00 – What will the value of the property be after you’ve refurbished it
New Mortgage Amount: £525,000.00 – New mortgage amount (assuming 75% BTL)
Money Pulled Out: £175,000.00 – Money pulled out after refinancing (assuming 75% BTL)
Profit: £249,000.00 – How much profit you will make (Please note: if refinancing, much or all of this will be left in the deal)
Money Left In: -£74,000.00 – How much money will be left in the deal assuming you refinance on a 75% BTL mortgage

Income Gross

Monthly Rent: £5,100.00 – Average nightly rate, use online comparables
Number of rooms: Number of rooms in the property being rented (If renting the whole property: 1 room)
Occupancy Rate: % – Average occupancy rate, use online comparables
Total Income Per Month: £0.00 – Gross income per month
Total Income Per Annum: £0.00 – Gross income per annum

Expenses

Mortgage: 6.00% – £2,625.00 – Mortgage payments post refinance
Management: 10.00% – £225.00
Maintenance: 10.00% – £262.50
Council Tax: £194.00 – Check the council website
Utility bills: £400.00 – Includes Gas, Electricity, Water, Broadband, TV License, Insurance (and cleaning if paying above what guest will pay)
Total Expenses: £3,706.50 – Total monthly expenses

Cashflow

Monthly income: £5,100.00 – Total monthly income
Monthly Expenses: £3,706.50 – Total monthly expenses
Monthly Profit: £1,393.50 – Total monthly profit after expenses
Annually Profit: £16,722.00 – Total annual profit after expenses

Local Agents Review:

Serviced Accommodation Potential

There is a strong contractor market in Torquay, making this property ideal for use as serviced accommodation for contractor housing.
For 7 guests sharing bathrooms, the estimated nightly rate is £877, offering significant revenue potential.

Renovation Costings

• Estimated works of £130,000 are required to renovate the property to full HMO specification.

• The decision to include en-suites will impact the final cost.

• A detailed and accurate estimate can be provided once the floor plan and finishes (tiling, flooring, kitchen, etc.) are confirmed.

• The property has mains gas but is currently electrically heated; all systems are fairly modern.

• As it was previously a guest house, an old fire system remains in place and will need upgrading.

• Windows are generally in good condition but may require replacement to comply with fire regulations and conservation area requirements.

• There is a double garage suitable for parking and a storage area that can be utilized for bikes and bins.