Residual Appraisal — E1 6 Units

GDV

£4,334k

6 × £722,332

Total Costs

£2,680k

construction + finance + profit

Residual Land Value

£1,654k

what you can pay for land

Per Unit

£276k

land cost per unit

GDV Waterfall — Where the Money Goes

Construction

34.8%

£1,510k

Finance

7.0%

£303k

Developer Profit

20.0%

£867k

Residual Land

38.2%

£1,654k

Total GDV: £4,333,992 = 100%

Finance Cost — The Teaching Moment

✓ Correct: Progressive Drawdown

Land: £1,663,827 × 7.5% × 21mo = £218,377

Construction: £1,509,750 × 7.5% × 9mo* = £84,923

* 9 months = build period ÷ 2 (costs drawn progressively, not on day 1)

Total: £303,301

✗ Common Mistake: Simple Interest on Full Loan

£3,173,577 × 7.5% × 21mo = £416,532

Assumes all construction costs are drawn on day 1 — this overstates the loan balance throughout the build.

→ Progressive drawdown reduces stated finance costs by £113,231 (27.2% lower)

Sensitivity — Residual Land Value (£)

Rows = build cost variation · Columns = sale price variation

	Sale Price −10%	Sale Price Base	Sale Price +10%
Build -10%	£1,489k	£1,797k	£2,105k
Build Base	£1,346k	£1,654k	£1,962k
Build +10%	£1,203k	£1,512k	£1,820k

Finance Rate Sensitivity

6.0% finance

£1,715k

residual land value

7.5% finance

£1,654k

residual land value

9.0% finance

£1,593k

residual land value

Data Sources & Assumptions

Sale price: Market-derived · PropertyData asking prices · 1,373 flat listings in E1

Build cost: ⚠ Benchmark only · London flat £275/sqft · Build-cost API requires full postcode · Commission a QS

Finance: 7.5% per annum · Progressive drawdown method · Land loan: 21 months · Construction: 9 months avg

Contingency: 10% of build cost

Prof. fees: 12% of build cost

Profit target: 20% of GDV

6 units · flat · E1