To an auctioneer riding London’s property boom, it is a “freehold single storey detached unit” in the upcoming suburb of Walthamstow. To the untrained eye, it looks like a large converted shed in east London. And it could be yours for £70,000.
The tiny property, roughly the size of a garage, goes under the hammer this month as the latest example of the capital’s gravity-defying property market. If the guide price of £70,000 seems too much, auction agents are reassuring potential buyers that they recoup their outlay by renting it for £193 a week or more than £10,000 a year – the current owner’s going rate for tenants.
House prices in the borough have increased by more than 10% over the past year. Walthamstow is increasingly desirable to young professionals and property website Zoopla puts the average price of a one-bedroom home in the area at almost £270,000.
It is almost unheard of for freehold properties in the capital to come on the market for less than £100,000, so at £70,000 the guide price for the studio is eye-catching. An investor who meets that price and continues to let it at the current rate would achieve an annual return of 14% before fees and costs.
But it might take a leap of faith for those who visit. When the Guardian went to check out this seeming bargain it found it down a graffiti-ridden alleyway between two rows of houses. Abandoned children’s toys, rubbish and dog excrement littered the passage, about 15 minutes’ walk from Walthamstow Central station. A pile of bricks and breezeblocks sat outside the outbuilding, which was set at the end of a garden behind a former shop. The “studio”, which contains a kitchenette, shower room and toilet, measures just 15 square metres.
A few metres away a gym blasted out loud music. Almost every property on either side of the passage had some kind of shed or outbuilding at the end of the garden. Some had door numbers, suggesting people lived there.
Both the shop building and the land around it seem to have changed hands in February, with Land Registry documents showing that they were bought by a private company. The legal documents for the sale describe the property as “land” and say the sale is being made with vacant possession.
The property is due to go under the hammer on 23 June, among 185 lots being auctioned at a central London hotel.
The local council said it would be looking at the property to check that it “has all relevant permissions and meets planning requirements”. A spokesperson added: “The council will always take appropriate action if a property is found to be unlawful.”
