Buy-to-let deal of the day - Excellent investment property providing serious capital growth

As a landlord, it is very easy to become too focused on annual rental yields, rather than capital appreciation over time. 

A question I always ask our clients is "have you considered your exit strategy?". By asking this question it provokes the discussion as to whether a property investment is likely to be a long or short term venture for the client. 

Each landlord has different individual circumstances, some are investing in property for the long-haul, for their children when they grow up or as a nest-egg for retirement. Landlords such as this may want to research the history of sold prices in a specific street, as a substantial and consistent rise may outweigh the need to achieve 5, 6 and 7% gross rental yields. 

Other landlords may be property developers and investors, looking to maximise the rents they receive to raise capital to invest on further assets. These clients may want to see a minimum of 7% annual yield, before selling up after 18-24 months, and moving on to their next project. 

Chichester is a prime area for capital growth, hence why many landlords have purchased property with 10, 15, 20+ year strategies in mind. A perfect example of strong capital growth is this beautiful three bedroom house on the extremely sought-after Summersdale Road. Currently on the market with Henry Adams estate agents at £410,000, this property has seen huge annual capital growth, averaging a whopping £25,000 since it's last sale at £285,000 back in January 2010. Based on the properties condition and location, I don't think the vendor will have any difficulty achieving a quick sale close to the asking price. 

http://www.rightmove.co.uk/property-for-sale/property-52285931.html?premiumA=true

From a rental perspective, this property should fetch £1250pcm, returning a 3.7% gross yield, which is still greater than one can expect from a savings account at this moment in time.

All in all, a very sound investment!  

Remortgages are on the up

With mortgage rates currently at a record low it is widely expected that rates will soon begin to rise, meaning that it could be a good time for landlords to consider remortgaging. 

Figures from the British Bankers Association indicate that many landlords are reviewing their options, taking advantage of competitively priced offers, and securing fixed rate deals before they disappear. 

As well as protecting against Base Rate increases, the competitive nature of the mortgage market may mean that landlords can actually cut their mortgage costs now.

Assuming a base rate increase in spring 2016, it is likely that we may actually see interest rates gradually rise before then – so remortgaging a day before the base rate increase won’t be a good idea!

Our office has teamed up with London & Country to offer fee-free Independent Mortgage advice, so now may be the time to consider your remortgage options. Please give me a call on 01243 887887, and we will be happy to put you in touch with one of their expect advisers. 

YOUR HOME OR PROPERTY MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE

Rents Rising in Hay Road, Chichester

A landlord I know has owned a few properties on Hay Road for the last fifteen years. She came in to our office to discuss the rise and fall of property prices on the street and how this has affected her yield over the years.

In 1999, when she purchased her first property on Hay Road the average value of a terraced house on the street was £76.950 which had a sharp rise to £146,250 by 2004. This rise in value continued, with average values being £174,950 in 2008 and £181,500 in 2011.

At the height of the property boom in this area in 2007, a semi-detached house on Hay Road had an average value of £224,975. This dropped slightly in 2013 to around £221,660, with the average value increasing to around £232,500 this year.

When she told me of the rents she had achieved on the street, they seem to have steadily risen over the last 10 years. In 2006 the average rent was £800 per month for a three/four bedroom house, and is now around £1200pcm, dependent on the property’s accommodation. Therefore, a landlord could expect a respectable annual yield of around 6.2% on Hay Road at the moment.

If you would like some free and impartial advice with a potential investment, please come and see me in our offices at no.12 Southgate, call 01243 887887 or email matt.berry@martinco.com

Is Roussillon Park a good development for buy-to-let investment?

As you may already be aware, Roussillon Park is a new housing development to the north of Chichester City centre on the site of the historic former military barracks. Previously the home to Royal Sussex Regiment and Royal Military Police, the site is being redeveloped to provide 250 new dwellings.

It generally takes a short amount of time to let properties on the developments. Tenants consider the proximity of the city centre to be an advantage, as well as the luxury of living in a new property. A two bedroom coach house, depending on size and outdoor space, could be purchased for around £280,000 or £290,000. The rents that could be achieved for these are between £975 and £1000 per month. This means landlords can potentially expect yields of around 4.3% per year.

Two bedroomed apartments can be purchased between £260,000 and £270,000 and they typically can let for between £900 and £950 per month. There is usually the service charge that a landlord needs to pay to the freeholder of the building, this usually includes building insurance and grounds maintenance. Even after paying that service charge, yields of between 4% per year are achievable.

If you have already done a search for property or are trying to figure out where to start, we’re happy to advise on properties before you buy. It’s in your interest that you purchase something that can let, so please give me a call on 01243 887887 or visit our office on Southgate. 

Developers website - http://www.roussillonpark.co.uk/

How can you find a good property deal in Chichester?

How can you find a good property deal in Chichester?

I was talking to one of my landlords the other day, when he explained there were no property bargains for him to buy in Chichester. We don’t sell property and don’t charge for our advice, so we can give impartial opinion without any conflict of interest to our landlords. Here is what I discovered recently about finding bargains that I have come to the property market over the last few months.

A 1 bed apartment in Henty Gardens (just off Westgate) sold in 2008 for £160,685. In July this year, she sold again for £150,000, a drop in value of 6.65%. A 2 bedroom apartment in Wolfe Close (just behind the Nuffield Hospital on Broyle Road), sold for £245,000 in May this year. When new, it sold for £249,950 in summer 2008, these are excellent value properties.

Finally, one of the popular retirement apartments, opposite the train station on Stockbridge Road, sold for £285,950 in 2004. Considering property values in the area are much higher of those being achieved in 2005, some lucky person picked up a real bargain in May, when it sold again for £240,000.

Whether you are a landlord of ours or not, drop by our offices at 12 Southgate, Chichester if you would like any advice whatsoever. 

Buy-To-Let Deal of the Day - 4.6% Gross Yield and £134 Per Week Rise in Value!

This property in Little Breach caught my eye this morning as a decent buy-to-let opportunity. Positioned on the doorstep to the well regarded Jessie Younghusband school (which recently received an 'Outstanding' Ofsted review) this property would be snapped up quickly by working families. 

http://www.rightmove.co.uk/property-for-sale/property-36039312.html

This particular property, on the market with Cubitt & West estate agents at £315,000, appears to be in good order throughout, with an attractive kitchen, as well as a garage and driveway. 

Rents for similar properties in Little Breach currently fetch £1200pcm, which would return a steady gross yield of around 4.6%. Having researched current values in the street, prices have also risen by just over £7000 over the last 12 months (or £134 per week!) which would also provide a potential investor with healthy capital growth. 

Buy-To-Let Deal of the Day - Substantial family home for long term tenants

I was speaking to a landlord last week who lives in Surrey and is looking to expand his property portfolio in the Sussex area. He already owns a lovely three bedroom bungalow in Birdham which has consistently let to families who have stayed, on average, between 4-5 years. Having good quality, long-term tenancies is a big driver for him, and he is looking for properties that offer similar opportunities in the Chichester area.

We established three main focuses for his property search:

1. Proximity to good local schools and transport links
2. High standard of cosmetic finish to attract the best calibre of tenant and minimise expenditure
3. Opportunity for strong capital growth

Looking through Rightmove we noticed a modern four bedroom family home in the village of Nutbourne, close to the sought-after Chidham Schools, and Bosham railway station.

http://www.rightmove.co.uk/property-for-sale/property-35636277.html 

On the market with Whiteheads estate agents at £389,995, a landlord could expect to receive a rent of around £1450pcm - providing a gross yield of 4.5%. More interestingly, however, is that house prices have risen in Nutbourne village by 9.10% on average over the last 2 years, representing a whopping £30,539 in capital growth!