Worth a look - Fisher Court, Ilkeston up to 7% Yield

I saw this property on Fisher Court on the market with Your Move Ilkeston, which could rent for between £425 and £450 per month - good value for a 3 bed family home.

It looks ready to rent out with minimal input from any potential buy to let investor.   

Should be worthwhile booking a viewing directly with the agent. As ever, someone will take this, especially as the property is priced at the lower end of what is currently a fast moving market.

Derbyshire Buy to let rule two

Rule #2 Detach Yourself

YOU will not live in the property you buy. 

As such, whether YOU like it isn’t the primary consideration! 

This is a business transaction, and as such the question is whether it works from a business perspective?

Amber Valley/Erewash/Broxtowe Property market’s – tale of 4 very different towns

Following last week’s article about how property values had risen, I thought I would share that the weekly prices rises are only part of the story. Whilst the weekly property value increases in pound notes show some towns better than others, one must look at the percentage increases as well to get the full picture.

Out of Ilkeston, Heanor, Eastwood and Belper, the best performing town was Heanor, with property values increasing on average 8.4% in the last 12 months. Silver medal goes to Eastwood at 5.3% over the same time frame and Bronze is a photo finish, with Ilkeston piping the post with increases of 4.3% and Belper at 4.2%

So is Heanor best to invest in? Not necessarily! Property ownership is a long term consideration. Today’s Ilkeston’s property values are only 5.1% higher than they were 3 years ago (so you can see most of that increase has been in the last 12 months). Heanor’s property values are a more impressive 8.5% higher and Eastwood’s are 8.2% higher than 3 years ago. However, it’s Belper that is the big surprise. Yes, it’s true property values are 4.2% higher than they were a year ago, but here’s the surprise, they are in fact 1% lower than they were 3 years ago.

Investing in property is also about the yield / annual yield that a landlord can earn each year as well. Interestingly, Eastwood landlords have the highest average yields of 5%, with Ilkeston and Heanor having average yields of 4.1% per year.  Belper’s average yield is only 3.2% per year, but landlords are compensated with higher property values
  As I have a database of all the house sales going back to 1999, I can keep an eye on the trends and see where the hot spots are for investment. If you would like some advice about buying to let, be you a landlord with a portfolio or someone thinking of investing in rental market for the first time, please ring me on 01332 910499 or email on lettings@sprucetree.co.uk

Nottingham Student lettings - take care you dont lose your Article 4 licence

I always tell Nottingham  landlords, capital growth and yield are two phrases that are one and the same with property investment and can have a big impact on the long term results of your property investment. 

Student letting is high reward (high yield) but high risk. The council imposed their Article 4 legislation a few years back, which means no more houses in the majority of the town can be converted into student accommodation. This however, is not the issue. There is in fact an oversupply of student accommodation in the city, with most students preferring to live in modern swanky apartments on campus than that of woodchipped wallpapered 8 bed Victorian houses with one shared bathroom and draughty single glazed windows.
Today’s students have a higher expectation of quality in their accommodation. They expect their properties to be ‘Lam and Mag’d with matching dark wood Ikea furniture, flat screen LCD telly on the wall and leather Sleigh bed’ (Lam = laminate floor and Mag’d = magnolia walls). Students will not pay £85 per person per week for a draughty old house, with mix and ‘not match’ second hand furniture that has come from a clearance sale, threadbare carpets and the famous wood chip wall paper.

Come the Summer, there will be student properties that don’t let. This is where the issue of Article 4 will kick in and potentially hurt the student landlord population. Landlords with an existing student property (they are called Houses under Multiple Occupation shortened to HMO’s) will be very reluctant to rent to a family in the year if it means they lose their HMO status. By putting a family in an existing HMO property, Article 4 rules mean you have changed the ‘use’ from a shared house (HMO) to a private dwelling. You would therefore need to apply to the Planning Department for planning permission if you wanted to put students in in the next academic year. Would you get planiing permission? Doubtful

One option is to drastically reduce your asking rent to the £70’s, even £60’s per week, making your Nottingham  student let, the bargain of the week, for cost-conscious students. You could consider throwing some extras, like free Sky Sports or wifi or even a cleaner?
However, you will always be chasing your rent downwards over the coming years, as more and more purpose built modern halls of residences get built. If you are in the student rental game for the long term, one option would be to let the property go empty or void (this doesn’t affect the HMO status) this coming Summer, ‘Lam and Mag’ in July and August, take your trailer down to the Ikea in Eastwood .. make it show home style .. take some fabulous internal pictures (for future marketing) and launch the property back in September to the overseas Post grad students. It should go in days and at a full rent at £90 or even £95 per week and incentivise the post grads to keep the property ship shape when undergrads start looking in November for the next academic years. Again, if its top draw, it will go quickly and at full price.

Every landlord and every property is different, but if you are an Nottingham  landlord, with student property, there are many options for you to consider. I don't charge for my advice because if I offer you the best opinion and we build a relationship, then you might (and there is no obligation or expectation to this) just use me to manage those properties and so I have plenty of time to earn money from you by looking after your buy to let property for years to come.

Derbyshire Buy to let - rule one

Rule #1  Everything Lets

When potential investors come to see us, they are often concerned whether the property they buy will let. They needn’t be – it doesn’t matter if it’s a palace or a flea pit – everything lets, but that’s not a recommendation to buy a flea pit! The question they should be asking is WHO it will let to – a 3 bed in the town centre is far more likely to attract sharers than a family for example. Every now and then a landlord comes in with a property that he’s been unable to let through another agent. 

We know without seeing it that either 

1. it’s badly presented or 
2. he’s overpriced it. 
3. There isn’t usually a 3

Good Yielding 2 Bed Terraced Ilkeston

This property represents good value, in a part of town that is becoming more sought after. 

Asking £80k, it's going to need some freshening up internally, certainly carpets, a tidy up in the garden and perhaps a lick of paint. You might get it for slightly less and spend the difference on the tidying up. 

With a rental in the region of the mid-£400s the yield equates to around 6.75%. On with Renshaw Estates  - have a look here. 

Property Market : Ilkeston vs Heanor vs Eastwood vs Belper

Last week, a landlord who lives in Smalley rang me up to discuss the rising property values in the Amber Valley and Erewash areas. He owns a varied portfolio of rental properties in Derbyshire, primarily in Ilkeston, Heanor, Eastwood and Belper, so it is interesting to compare the increase in property values around the area.

Over the last 12 months, in Ilkeston, average property values have risen from  £127,750 to £133,200, a rise of just over £5,450, or £104 per week. When I looked at some of the surrounding areas, Eastwood’s property values increased from £105,900  to £111,500, a rise of £107 per week. Belper came in next with property values rising from £190,700 to £198,600, a rise of £152 per week. Finally though, it was Heanor’s property values that saw the biggest jump, with an average property value rising from £121,900 to £132,200, a rise of £198 per week. A rise in all the town’s average property values suggests the market is recovering steadily in our area – good news for home owners and landlords alike.

Next week we will look at how values have risen in our area, both recently and since the property crash of 2008. In the meantime, when considering this landlord’s buy to let portfolio, yields can be in the order of 5% to 7% per year, depending where you buy, so combine that with steady rental growth, excellent increases in capital values of the properties themselves, it could be a good time to invest in the property market in Amber Valley and Erewash as property values start to rise?

 

If you would like some advice about buying to let, be you a landlord with a portfolio or someone thinking of investing in the rental market, please ring me on landline number 01332 910499 or email on lettings@sprucetree.co.uk