Case Study: Flipping a Grade II listed flat for profit

1 Sept

Client: Own project
Location: Staffordshire
Property Type: Grade II listed top floor leasehold flat
Completed: 2020

This top floor apartment is set within a Grade II listed building within a Conservation Area located a short walk from Tamworth's train station and town centre. The property has undergone a full renovation including layout alterations complete with our signature Scandinavian interior.

Is It Too Risky to Flip a Grade II Listed Flat?

Some investors might be put off by a project like this, as it wasn’t straightforward. The challenges we faced included:

Listed Building Consent: We needed to obtain listed building consent for the layout alterations we were planning, as well as to replace the windows.
Low Lease: The flat was leasehold with less than 80 years remaining on the lease, so we needed to extend it.

In today's market, where it is increasingly difficult to source deals, projects like this often face lower competition. This is because many investors shy away from listed buildings, particularly for flip projects, or if they are newer to investing. The added complexity of negotiating a lease extension further reduced competition. I believe these two factors were key reasons we secured the property for £10,000 below the original asking price of £80,000.

Was it risky?

For us, no. As architects, we had the in-house expertise to manage the listed building consent process and the planning approvals. Additionally, I had previous experience extending a lease on a property in London and had organized lease extensions for a block of nine flats. This gave me confidence in navigating the lease extension process.

Could it have been risky for others?

Absolutely. For someone without experience in listed buildings or lease extensions, this project could have been risky. However, you can de-risk a project like this by assembling the right team, including an experienced architect, to guide you through the complexities.

Before Photos

The Story Behind This Project

We purchased this property in late 2019 with plans to turn it into our first serviced accommodation unit. However, we had no idea that a global pandemic was just around the corner. As fate would have it, the first lockdowns coincided perfectly with the completion of our refurbishment—right when we planned to list the property on Airbnb.

With travel and tourism halted, we quickly pivoted to our "Plan B." Instead of running it as a short-term rental, we opted to let the property out as a single let and soon found a tenant. About six months later, the tenant expressed interest in purchasing the property. After much consideration, we decided to sell off-market directly to the tenant, effectively flipping the property.

Although the project was still financially viable as a single buy-to-let (BTL), the returns were lower compared to what we had projected for serviced accommodation (SA). Ultimately, selling the property allowed us to reinvest the funds into another project, ensuring that we continued to pursue higher-yielding opportunities.