[2024] UKUT 020 (LC)

The bank’s solicitors commissioned a valuation report from a Mr David Nicholls MRICS of Allied Surveyors, a firm based in Blackburn. Mr Nicholls was familiar with the Burnley area and had practised in Lancashire since 1990.

Mr Nicholls commented that the overall condition of the property would appeal to a local builder/speculator who would want to refurbish and renovate it. Demand from first time buyers would prove unlikely due to the difficulty in obtaining mortgage finance, without a large deposit.

He had regard to three sales of similar houses nearby on Spenser Street. Number 34 sold in January 2023 at £73,500. It was in similar condition to the subject property, requiring improvement, with no kitchen or bathroom fittings. It was marketed two days after the subject valuation date at £79,950 and was under offer shortly thereafter. Number 38 sold on 11 October 2021 for £88,000. It had two bedrooms (with a third in the loft, apparently without building regulations) but had been modernised and was well presented. Finally, number 32, which was identical in style, but had two bedrooms and was modernised, sold in May 2022 for £95,000.

On commenting on the evidence, Mr Nicholls said that number 34 was the most directly comparable property. It had been cleared of debris and been deep-cleaned, ready for renovation to commence. Its sale price reflected a tone of value of properties requiring refurbishment work, which was generally at £65,000 to £75,000. Properties requiring refurbishment were sought after by buy-to-let landlords and builders/speculators who can add value by refurbishment.

Mr Nicholls valued the long leasehold interest at £70,000 at the valuation date.