Case study · Liverpool L4
50 Bedford Road, Liverpool: £140,000 house to a £300,000 HMO
This is the project behind the £300,000 figure that appears elsewhere on this site, set out with the numbers the owner actually paid and received. It is a good example of the point we make constantly: the money is made in the relationship between price, location and size, not in the decoration.
The numbers
| Purchase price | £140,000 | |
|---|---|---|
| Purchase costs | £5,000 | |
| Licensing | £6,000 | |
| Refurbishment | £90,000 | |
| Total invested | £241,000 | purchase, costs, licensing and works |
| Time to convert | 4 months | |
| Valuation on completion | £300,000 | |
| Refinance loan | £244,000 | 80% of the new valuation |
| Gross rent | £3,200 / month | |
| Net to the owner | £1,500 / month | after running costs |
| Return on investment | 60–65% | the investor's own figure |
Strategy: Buy, refurbish, refinance, rent (BRRR) — conversion to a six-bed HMO
What made it work
- No extension was needed. The house was bought because its existing layout could be reconfigured into the rooms required — which is why price, location and size matter more than condition.
- The refinance at 80% of the new £300,000 valuation released £244,000 against £241,000 invested. On these figures the project returned the owner’s capital in full, which is the whole point of a BRRR and the reason the return is expressed as a percentage rather than a payback period.
- Four months from purchase to finished conversion. Every extra month is finance being paid on an empty building, so the schedule is part of the return, not separate from it.
- One of the rooms lets at around £700 a month on its own, because it has its own bathroom and genuine space. Room quality is not decoration; it is rent.
The full walkthrough, in Noel’s words
Transcribed from the video and edited for readability — filler removed, punctuation restored and mis-transcribed names corrected. The figures are as stated in the video; where the video says "cash flow of £3,200" that is the gross rent, and the net figure of £1,500 comes from the owner’s own account of the property.
Welcome to this success case study for a property in Liverpool — specifically, 50 Bedford Road.
The property is the house in the middle, the white one with three levels. It was owned by somebody who was retiring and downsizing to a smaller flat. He no longer needed all the space, so the property came up for sale. That was a great opportunity, and I will show you why.
This was the layout before we bought it and before we converted it: a kitchen, a dining room, a lounge, a large bathroom, a bedroom, another bedroom, and two bedrooms at the top. It was a perfect property for the conversion we needed to do — without any extension, purely reconfiguration. When we came to refurbish it, that became even more obvious.
When we look for these properties, this is exactly what we look for: a relationship between price, location and size. That is what makes the sort of values and returns this investor achieved possible.
The completion statement shows the gross loan at £244,000, which is 80% of the £300,000 final valuation he received for the property. That is an incredible outcome relative to the investment he made.
When the property was first visited it was loved, but tired. It had electrical issues and it needed decorating, and the layout had to change slightly to achieve what we wanted. But the property was big enough, with plenty of space and plenty of opportunity — the kind somebody experienced in these strategies can see immediately. We did, we went for it, and we bought it.
We built a boiler room at the back to provide the space needed for the additional hot water storage the conversion required.
On the first floor there was a very large bathroom. That is something remarkable to find when you buy a property, because it means space, and space means potential. That bathroom became a bedroom with its own bathroom. Another generously sized room became a second bedroom with a bathroom. That room currently lets for around £700 a month, because it has its own bathroom and plenty of space, and it works very well.
On the floor above there were two rooms that looked small, but when we measured them we knew they would meet the regulations. We removed the plasterboard ceiling that was covering the beam, and the sense of space in the room increased considerably.
The conversion took about four months, which is a good timescale — it keeps the project efficient, because throughout that period the investor is paying for the loan.
The finished property has two kitchens, because the regulations require that size and design for this number of occupants. The rooms are finished to a standard we would want in every property: good space for sharing, and a genuinely good standard of living for the tenants.
The valuation came in at £300,000. The investor bought at £140,000, with £5,000 of purchase costs, around £6,000 of licensing, and £90,000 of refurbishment. The monthly rent is £3,200, and it was about a 60 to 65% return on investment.
This property is now a very good asset for this investor and his family, and looked after, it will remain one for the long term.
If you want a property that does this, we source and develop them in Liverpool and the Wirral, and manage them afterwards. Or run your own numbers first on the buy-to-let calculator — free, no sign-up.