Off-Market Distressed Property

Distressed property is a double edged sword

The Landlord & Property Act 1925 (LPA) gives lenders a wide range of powers to repossess property with great ease. The time it takes for lenders to claim breach of contract under the act and start collecting rents, changing locks and eventually selling the property is alarming! They can do all this without the involvement of a court and in a very short space of time. The process involves the appointment of an LPA Receiver by the lender who will then act for the lender to recover the debt.

These kind of repossessions are increasing rapidly with the uptake of investors holding property in an SPV or limited company meaning that borrowings are almost always on a commercial basis, which gives the lender the aforementioned powerful rights provided by the Landlord & Property Act 1925.

Whilst this can be a bad situation for borrowers, it does present a real opportunity for savvy investors to pick up property at a significant discount, direct from LPA receivers.

At present, the UK Distressed Property list only includes distressed property offered for sale on the open market. These are properties that an LPA receiver may have already passed onto an estate agent or auction house for various reasons or they may be residential repossessions.

However, we have another list under development that contains ‘off-market’ repossessions. These are properties that have been recently repossessed and are under the control of an LPA receiver but importantly not yet passed onto estate agents or auction houses. It is this time window, before the receiver decides to off-load the property, that offers the greatest opportunity to get in contact with them and make an offer.

The new off-market distressed property list employs a unique algorithm to process data from various sources in order to identify ‘off-market’ property in distress e.g. property that an LPA receiver has taken control of. Our data can be extremely up to date and often we are aware of a property going into receivership as soon as the documents are electronically processed by other systems.

If you are interested to hear more about this ‘off-market’ list then signup below and we’ll get you more details and let you know when the list is available.