We Reviewed a Four-Property Portfolio.
One Property Changed the Picture

Meet Gary

Gary is a self-employed electrician from Wigan. Over about nine years he has picked up four rental properties, three terraced houses and one flat, buying when he could and holding on. He manages most of it himself around the day job. Everything is let, the rent turns up, and as far as Gary was concerned, all four were doing much the same job. He asked for a PROXERA property review for a simple reason: he wanted to know if he could afford a fifth.

What the review found

Three of the four were exactly as Gary thought: steady rent, decent returns, tenants settled, not much to worry about. The fourth, the flat, was a different story once you looked past the rent. Its service charge had crept up year after year, its ground rent took another slice, and its cheap mortgage was about to end. Add all that up and the flat was barely breaking even each month, while Gary had assumed it was pulling its weight like the others. One property was quietly dragging on the other three, and the overall picture had been hiding it.

What he did next

Gary did not rush to sell. The review had done the useful bit: it turned “should I buy a fifth?” into “what do I do about the flat first?” He asked his mortgage broker to look at the flat’s finance before the rate ended, and he dug out the service charge accounts he had never really read. The three houses he left well alone. Selling, refinancing or holding are decisions for him and his broker or accountant, not for us, but now he is making them with the full picture instead of a hunch.

What you can take from it

An average is a comfy place to hide a problem. Judge all your properties by one rough number, or just by the rent coming in, and your best performers will quietly carry your worst. The ones worth a proper look are often the ones that seem fine on the surface. Seeing each property on its own, side by side, is most of what a property review does, and it is usually the flat, the service charge or the ending mortgage that turns out to be the surprise.

Where the surprises usually hide

Gary’s review did not find a disaster. It found the one thing an average was quietly covering up.

• Averages hide outliers. Your strongest property can carry your weakest for years without either of them showing up in the total.
• The quiet ones are worth a look. It is rarely the property causing you trouble that needs attention. It is the one that never asks for any.
• Knowing changes the question. Gary went from “can I afford a fifth?” to “what do I sort out first?” Both are fair questions. Only one of them was answerable.
• Nothing has to change today. Seeing the full picture does not commit you to selling, refinancing or anything else. It just means the choice is yours to make.

Four properties, nine years, and one afternoon of clarity. That is usually all it takes to know where you really stand.

Example scenario. Figures are illustrative and not advice. Speak to a qualified adviser, accountant or solicitor before acting.