More Programmes From Channel 4 Case Study: Steve Goss

Date Published:

19/06/2008

Case Study: Steve Goss

Credit: Jason Gold

Interview With Steve Gold

In 2006 One Year To Pay Off Your Mortgage featured developer Steve Goss' project to build an apartment block in Montenegro. We caught up with Steve, a former agricultural advisor, to find out how it went.

Why Did You Choose Herceg Novi?

My work has made me into something of a gypsy, moving from one East European country to another, and I felt it was time I had a base somewhere in the region. Herceg Novi itself was a happy accident - a trip in a boat, a sign in a street, and by the end of the week we had bought a flat in the old walled city. As we slowly renovated it we came to realise just how much potential this area has: the whole Boka Kotorska bay is stunningly beautiful and prices are just going up and up. So we decided to have a go at something more ambitious.

How Did You Come Up With Your Investment?

Life in Montenegro is all about who you know. The agents who sold us the flat - Saša and Natalie Kekovic of Internos - became good friends and showed us a plot. It had just come back on the market at £60,000 with planning permission and tax paid for a three-storey villa with swimming pool.

The picture in my mind had been to renovate some old stone house by the sea, but none seemed quite right as a business proposition, whereas the back-of-the-envelope calculations for the new build looked good and the initial outlay didn't feel too scary, so we abandoned the original idea and went into the business of building.

How Did you Manage The Project?

I made an arrangement with Internos to manage and market the project, but I made the mistake of choosing an architect in Belgrade rather than near the site, and soon found myself as the go-between from the design team to the builders. I left Internos to do what they do best - steering a safe course through the minefield of Montenegro's building bureaucracy and the army of inspectors while I took more of the project into my own hands. It needed constant attention to stop things falling behind schedule.

When I started I could just about muddle through with Serbian. Now after 10 months I find myself using building terms in Serbian that I don't know in English

Did It Work Out The Way You Expected?

The mental arithmetic said we could do the new build for around £150,000 but we thought it would be easier to sell several apartments rather than one villa, so we began to re-draw the plans and it all took on a life of its own, getting steadily bigger and more expensive, and eventually cost about twice what we had bargained for.

The really nail-biting bit was the cash flow: I needed an equity release loan to buy the plot and only had enough left over to dig the foundations, after that we knew we had to sell something off-plan or stop building. The first sale came just in time but things got tight again. The real break came when the original buyer decided to take the whole building - he demanded a substantial discount but made it all work out. We came in at almost exactly our original profit estimate of £200,000.

Would You Advise Other People To Do The Same?

It depends what you want to do; if you're ready for a change of life and the 24/7 challenge of running your own business, then go for it! If you're looking for a good investment and a perfect place for your holidays, then buy something off-plan and let someone else do the work. If you choose well you should already be making money before the building is even finished

And Would You Do It Again Yourself?

I already am! We've rolled the money over into another plot down the road, a terraced hillside with wonderful sea views where we're going to build six villas, each with its own pool, parking and garden. It's going to be pretty demanding of both time and money but I've got a good team around me now and I know we can do it; I think it's going to be fun.

For further information, visit Bowen Goss Associates' website. www.bowen-goss.com

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