It’s well known that you have to dig deep to enter London’s property market, but this lot that sold at auction on Tuesday demands actual spadework.
Marketed as “a vacant front basement suitable for redevelopment”, this was one for investors willing to take a risk on getting the right planning consents. Prospective buyers were told, “There will be no internal viewings due to lack of access (excavation required)”.
The leasehold for the basement space below flats in New Eltham, south London, was up for sale with the Auction House at a guide price of £25,000. Bidding reached £27,000 before the hammer came down. The lot was sold by the freeholder of the property.
It’s not the first, or most expensive, unexcavated basement to be sold – in November a 1,975 sq ft plot of ground below a Bloomsbury block was sold by Savills for £150,000.
It suggests freeholders are starting to realise that they might be able to cash in on the land beneath their buildings. Another lot that sold ahead of Tuesday’s auction was a basement in Croydon, where planning permission had been submitted, but no digging had been done.
Auctioneer Andrew Binstock said: “We are seeing a few of these in our auction rooms. It’s like selling roof space above a property, except this is the gravel underneath.
“The idea is that the buyer will apply for planning permission safe in the knowledge that the freeholder’s consent is already given.”
Chris Coleman-Smith, auctioneer at Savills, said that some investors were willing to speculate on these kinds of properties, particularly in central London where development opportunities are scarce. “If they come off, great. It’s probably a lot of aggravation to get to that point, but if you can pull it off it’s worth it.”
In 2015, two flats in a neighbouring building in New Eltham were sold for £180,000 and £215,000, so if planning permits it could turn out to be a bargain basement.
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