Friday, 23 May 2014

Managed (and Tenanted) Versatile 3 Bedroom End Terrace (6.5% Gross Yield)

We've managed this 3 bedroom, 2 reception room (or 4 bedroom, 1 reception room...) end terrace for over 5 years and during that time have rented to families, professional sharers and students, it really is a versatile property

We're currently renting it to two professionals at £695pcm, which based on the owners £128k asking price will return 6.5% Gross Yield

Call us on 0191 567 8577 or email for more information 

Wednesday, 21 May 2014

Investors Guide to Sunderland - SR3

I must admit to being quite pleased to have got the SR1 and SR2 guides out of the way, as they needed covering off but they aren’t really the areas that we would focus on for delivering great investments – things start getting more lucrative (and therefore more interesting!) when you look at the SR3, SR4 and SR5 postcodes

SR3 covers a wide range of areas & property types from the exclusive detached properties in Warden Law Lane (average transaction value £423,673) to Somerset Street in Silksworth (average transaction value £64,636), just over a mile away

From a rental point of view, we tend to advise that it often makes sense to avoid either extreme, looking for properties that will attract the large number of working tenants (be they single people, couples or families) rather than pitching for non-working tenants on the one hand or the small number of highly demanding executive tenants willing to rent the more expensive properties on the other

The SR3 area has a number of different ways to cater for this hardworking tenant ‘core market’

For first time renters, be they single people or couples SR3 has a number of leasehold properties (flats) that represent much better value than similar sized properties in or around the City Centre

Flats in Farringdon (such as the 1950’s built Carlisle House on Ashford Road & Aydon House on Aberdare Road) near to the Farringdon Academy are always popular, not only with first time renters but also older tenants looking to downsize

We manage a number of properties in blocks in this area and they will return 7.8 % Gross Yield based on an average purchase price of £60,000 - £65,000 and an achievable monthly rent of £425pcm – we’ve recently posted a couple of bargain properties to the blog offering even better returns so it’s worth keeping a close eye on the market to snap up a bargain

Even closer to the major employers in Doxford International Business Park (such as Barclays, EDF Energy & MoreThan) are the 1970’s built flats in Moorside and nearby Chapel Garth – again we manage several and they are rarely empty, with a steady supply of good, working tenants looking to live close to work or because of the good access to the rest of the region via the A19

These flats can come with a garage (in separate blocks) and the ground floor flats have decent private rear gardens - beyond that it’s worth checking whether or not the original electric heating has been upgraded to gas central heating, as this will always increase tenant appeal

A typical Moorside Flat will return 6.75% Gross Yield based on an average price of around £80,000 and £450pcm rent

There are also flats in the Lakeside Village developments which will rent well (however most are owner occupied with older residents who have purchased in the 80’s through the Right to Buy scheme) so it is worth keeping an eye on any that do come onto the market as they may be sold with vacant possession & in need of a speedy sale

For families with children the SR3 postcode offers a number of areas with properties that will be both appealing to tenants and will provide decent returns for landlords

Most of the properties which will make good investments if looking to appeal to a family are ex-council, offering a decent amount of internal space & also the good size gardens that families prefer

Just as the flats in Farringdon are appealing to both tenants and investors alike, we would advise investors to look at houses in Farringdon – either a 2 bedroom semi-detached or ideally a  3 bedroom semi (3 bedrooms would be better than 2 as they are in shorter supply & therefore will be more sought after, not only that they will automatically suffer less ‘churn’ given the tenants are less likely to outgrow the property)

A typical 2 bedroom, ex-council semi such as the one on Aberdare Road from our recent blog post is £77,500 and will return 7.0% Gross Yield based on a conservative £450pcm, a typical 3 bedroom ex-council semi will cost £90,000 and return 7.4% based on a slightly higher £495pcm rent

In addition to Farringdon, similar ex-council properties can be found in the nearby Plains Farm and Thorney Close estates, however we would advise obtaining expert local advice before proceeding as whilst is it possible to pick up a great investment, these areas do have a higher proportion of non-working tenants in some streets so where you buy is paramount

That’s not to say these areas should be avoided outright - we’ve just let a 3 bedroom semi in Plains Farm (in under a week) for one of our landlords who bought it as an investment following our advice – he paid just under £85,000 and based on the £525pcm rent will return him a healthy 7.4% Gross Yield

The above example proves there’s clearly good investments to be had in the SR3 postcode but as always we recommend taking expert impartial advice before making any purchase

Please call on 0191 567 8577 or email for objective & impartial advice on all aspects of property investment in Sunderland

2 Bedroom Semi in popular Farringdon (7.0% Gross Yield)

This 2 bedroom semi in a popular area looks almost 'ready to let' with a good standard of modern decoration throughout and a decent kitchen - the bathroom may need updating but that's about all that will be required 

It's on the market for £77,500 so based on a conservative £450pcm (£475 may be achievable) it will return 7.0% Gross Yield

Call us on 0191 567 8577 or email for more information

Immaculate 2 Bedroom Terrace in Barnes (5.8% Gross Yield)

This 2 bedroom double fronted terrace in Barnes looks ready to let and based on recent experience of letting a nearby property, it will be popular

In addition to the 2 double bedrooms it's got a converted attic with shower and a modern kitchen and bathroom

It's on the market at £113,000 and will achieve £550pcm, returning 5.8% Gross Yield

Call us on 0191 567 8577 or email for more information

Monday, 19 May 2014

'Needs Work' Bargain 1 Bedroom Flat (9.8% Gross Yield)

We know that 1 bedroom flats in this block & similar developments will be popular - this one needs work but that's reflected in the £32,500 knock-down price

Realistically, it looks like it could benefit from work to address a damp problem (and following this redecoration throughout) and the kitchen and bathroom could also be improved - building in a generous £10k for this it would still return 9.8% Gross Yield based on a total investment of £42,500 and £350pcm achievable rent

Please call us on 0191 567 8577 or email for more information

Two Bedroom Modern Seaham Apartment (7.1% Gross Yield)

This 2 bedroom apartment in a popular modern development in Seaham will rent at between £400 and £450pcm 

Based on the £67,000 asking price this will return 7.1% Gross Yield

Call us on 0191 567 8577 or email for more information

Friday, 16 May 2014

Sunderland Buy to Let - Rule #3

Rule #3 - Be Realistic

People need a lot of money to afford a deposit to buy a house, so many are renting instead. This means there’s good demand for rental property in Sunderland at the moment

At some point this will change. As such don’t assume that just because you can currently rent out a grotty property that will always be the case...and don’t assume because some estate agent is promising to get you £x in rent, that it will rent at that price for ever 

Rents can go down as well as up and it really is irrelevant what the last tenant was paying for the past few years...if the market has moved on since they moved in, you need to reflect what people are willing to pay now rather than then

Do your figures on a worst case scenario and you should end up with your expectations being exceeded, rather than fighting a constant losing battle to keep your head above water

Large South Hylton 2 Bedroom Semi Offering 7% Gross Yield

Ex council properties such as this in South Hylton are popular with working families and this one is in a good condition with an attractive garden, so will rent well

It might need a lick of paint to freshen it up and new carpets/flooring but other than that the kitchen & bathroom look good so it's not going to take much more than the £84,950 asking price to get it to an attractive lettable condition

Based on the above and a £495pcm rent it will return 7% Gross Yield and crucially you should never be stuck for a tenant

Call us on 0191 567 8577 or email for more information

Thursday, 15 May 2014

Another Downhill 1 Bedroom Flat Promising Good Yields (8.4%)

This is not the first 1 bedroom flat in Downhill we've highlighted in recent months but they do stack up as good, low risk investments for a relatively small outlay

This one is top floor & in good condition, so will easily achieve £350pcm (possibly a bit more...upto £375 for the right tenant) and based on the £49,950 asking price will return 8.4% Gross Yield

Call us on 0191 567 8577 or email for more information

Wednesday, 14 May 2014

Sunderland Buy to Let - Rule #2

Rule #2 - Detach Yourself

You will not live in the property you buy, so whether you personally like it shouldn't be the primary consideration! 

It needs to be in a good enough condition that you would be willing to live in it...perhaps not long term, but live in it nonetheless...but that isn't the same thing as being to your personal tastes or being somewhere you would ideally want to live

As an aside, those Landlords who think "It'll do for a tenant" are getting it spectacularly wrong and funnily enough will usually be the ones who complain that they never get tenants willing to stay beyond the initial 6 months...

Anyway, back to the main point... this is a business transaction, and as such the question is whether it works from a business perspective? 

A classic example being Plains Farm– it's not my favourite place, but I've never known a Landlord with a decent property there be short of tenants!

Three Bedroom Apartment in Modern Development (7.3% Gross Yield)

This three bedroom, top floor apartment in the quiet St Michael's Court development will appeal to couples or professional sharers (but perhaps not families with small children due to the lack of lifts!)

We manage a number of apartments in the development and it's always popular

Priced at £89,950 it will achieve £550pcm rent so will return 7.3% Gross Yield. That said, the internal photos show 'Do Not Use' tape on the kitchen & bathroom appliances, a tell-tale sign of a repossession, so you may be able to strike a hard bargain...

Call us on 0191 567 8577 or email for more information

Tuesday, 13 May 2014

Two Bedroom Semi in Popular Town End Farm (7.7% Gross Yield)

This 2 bedroom semi is new to the market and will be popular with a range of working tenants

It's priced at OIRO £69,950 and will return £450pcm giving 7.7% Gross Yield

Call us on 0191 567 8577 for more information or email 

Monday, 12 May 2014

Sunderland Buy to Let - Rule #5

Rule #5 - Estate Agents...Watch Them!

There are good Estate Agents, and bad Estate Agents, but they are all paid by a vendor to sell you a property, not paid by you to help you buy

They may not be as 'on your side' as they seem! 

Don’t get pressured into buying a property until you have a good feel for the market – if you miss out on a good deal, another will appear sooner or later

When you're viewing a horrible property and the agent is saying it’s "fine as a rental" they're simply demonstrating they don't know much about lettings (see Rule #4!)

Finally, they'll more than likely have a good enough understanding of what rent is required to give you a decent return on your investment - take any Estate Agents recommendations on achievable rent with a pinch of salt...or seek independent, impartial advice

Sunderland Buy to Let - Rule #4

Rule #4 - Condition is Very Important

It's far better to have Good Property in a not-so-great area, than a shabby property in a good area

That’s because Good Tenants want Good Properties, and as Sunderland has very few no go areas (even the 'worst' areas will have decent people willing to live there if the price is right and the condition is good), people are more likely to be flexible on where they live, as opposed to what they live in 

As such, you should either buy a nice property, or buy a grotty one and make it nice! Don’t buy a grotty one and expect a tenant to take it as it is. Any tenant that does take it is likely to give it back in an even worse condition than when you started!

Immaculate 2 Bedroom Terrace (6.8% Gross Yield)

This immaculate 2 bedroom, 2 reception room terrace is ideally placed for Seaham schools and will appeal to a wide range of tenants
It's on the market for £79,950 and won't require any further investment to achieve £450pcm, giving a 6.8% Gross Yield
Call us on 0191 567 8577 or email for more information

Sunderland Buy to Let - Rule #1

Rule #1- Everything Lets

When potential investors come to see us, they're 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 certainly not a recommendation to buy a flea pit, unless you plan to do it up!)

Rather than 'Will it let?' the questions investors should be asking are 
  1. Who it will let to? A 4 bed terrace in Alice Street is far more likely to attract sharers or students than a family, for example
  2. How much they will be willing to pay?
If an investor can answer the above and the answers fit in with their financial goals and objectives, they can then start to dig a little deeper

As an aside,  every now and then a Landlord comes in to see us with a property that he’s been unable to let through another agent 

Without wanting to stick up for our competitors, we know 9 times out of 10 that either; 
  1. It’s badly presented 
  2. He's overpriced it
  3. There isn't usually a 3...

Sunday, 11 May 2014

Buy to Let in Sunderland - What to Buy & What to Avoid

When investing in property, it’s important to remember that you make your money when you BUY a property, not when you sell it. 

If you buy at the wrong price, it’s more or less impossible to rectify that going forwards unless a rising property market saves you.

If you buy sensibly, you can also expect to sell sensibly if you ever need to. Try to avoid:

• Simply overpriced. Once you’ve established you can buy a nice 2 bed property in a given area for £X, don’t pay £X + £5,000 for one because you’re impatient. If you overpay at the point of purchase, you’re playing “catch up” regarding the value of the property from day 1....So DON’T overpay!

• Needs work, and this isn’t reflected in the price. DON’T be put off by properties that need work, as these are often the best buys. But DO ensure this is reflected in the price. If it’s £X for a nice one, its £X minus £5,000 for one that needs a kitchen and bathroom.

• Unrealistic rental price. If you’re buying in an area where flats rent for £450 per month, don’t expect yours to rent for £550 per month on the basis that it’s just been painted – expect it to rent for £395 per month if you don’t paint it!

• Lacking key features. If you’re buying in the suburbs to attract the family market, don’t buy the one house on the street that has no garden, or no parking. Families want gardens!

Thursday, 8 May 2014

First Floor Flat Near to Doxford International Business Park (8.9% Gross Yield)

This 1 bedroom flat close to Doxford International offers great Gross Yields 
and will be popular with both young professionals or older tenants

Sunderland Property Blog
Priced at £56,950 it will rent out for £425pm delivering 8.9% Gross Yield

It looks 'ready to let' so other than a lick of paint there won't be any significant further investment required

Call us on 0191 567 8577 or email for more information

Tuesday, 6 May 2014

Ground Floor Moorside Flat (+6.75% Gross Yield)

This 2 bedroom Moorside flat has gas central heating, a garden & garage meaning it has the 3 most important factors in appealing to a range of tenants looking for a flat close to Doxford International Business Park

At £80,000 it will return 6.75% - 7.4% Gross Yield, based on £450 - £495 achievable rent

Call us on 0191 567 8577 or email for more information

Tidy 2 Bedroom Semi in Redhouse (7.7% Gross Yield)

This 2 bedroom semi in the popular Redhouse area will get good interest from a range of working tenants and looking at the Estate Agents photos doesn't look to need any major improvements prior to letting
It will easily acheive £450pcm and based on the OIRO £69,950 will return 7.7% Gross Yield
Call us on 0191 567 8577 or email for more information

How To Choose A Sunderland Letting Agent

What are the most important things to consider when choosing a Sunderland Letting Agent?

Knowledge. Trust. A connection.

Those are the really important things.  Not the percentage management fee (is a tenner here or there each month really that important when you're entrusting someone to look after an asset worth tens of thousands of pounds?).

Not the 'Inspection Visits' & 'Qualified Tenants' bullet points in the window or on the website - they don't really differentiate anyone, everyone says they can do the same stuff so it all merges into one.

Ultimately, assuming the agent answered the phone politely and professionally when it rang, it comes down to a) do you like this person?  b) do you trust them? c) do they know what they're talking about?

There's obvious things that can help to build trust and should be a prerequisite, such as the agent being a member of a redress scheme & holding client money protection insurance but that's just the foundation, if you have a personal recommendation from someone that's a good start too...

I'll declare an interest here... I own a Sunderland letting agent and what's more, we have a load of bullet points of what we can do in the window!!

I'll deliberately not mention the name of the agency, this isn't about a hard sell for the company and if you're that interested in which Sunderland letting agent it is you'll find out easily enough...

We get a lot of business from recommendations and referrals and not a lot of business based on our fees being the cheapest (as they're not the cheapest and never will be...).

Of the business that doesn't come from referrals, most comes from relationships built over time and that makes for a much stronger connection with our landlords (and therefore they're much less likely to have their head turned by a cheap fee deal from a competitor).

The landlords we work with buy into our philosophy, that it's all about finding Good Tenants for Good Properties and we build the relationship from there.

This blog post is unusual as previous posts haven't mentioned the letting agency, they're usually objective, impartial (and free!) recommendations for investment properties or interesting articles arising from our research into the Sunderland lettings market.

In the spirit of honesty and building trust from the start I'll declare that this post is all about getting those nice Google search spiders to pick it up and get high up on the first results page for anyone searching for 'Sunderland letting agent' (the most popular & important search term), hopefully bringing the 'normal' blog to far more people's attention.

So, now that you've found your way here, hopefully you've found this useful and I do recommend you go and read another of my blog posts like one of the 'Investors Guide to Sunderland' articles or look at one of our recommended investment properties, trust me they really are far more interesting...

Friday, 2 May 2014

Investors Guide to Sunderland (SR2)

When you mention the SR2 postcode, particularly with respect to the rental market, most people will immediately think of Ashbrooke, with its large Victorian terraces converted into flats

The SR2 postcode actually has the widest range of property values in Sunderland from the most expensive Thornfield Grove (average value £405,813) to the least expensive Noble Terrace in Hendon (average value £39,405)

Whilst Ashbrooke may be the obvious choice for an investor looking to rent out a property in SR2, it is not necessarily the best option

Since the housing market collapse in 2007/8 demand from the mainly under 30’s tenants for flats in Ashbrooke has dropped significantly yet the number of available properties has remained constant as investors have ‘held on’ waiting for prices to rally

This has led to the inevitable drop in rents and the need for landlords to continually improve their properties due to tenants realisation that there is an awful lot of choice out there and they don’t need to settle for second best – falling rents combined with increasing costs & rising tenant expectations don’t make a great market for landlords!

With this in mind we’ll concentrate on perhaps the less obvious areas in SR2 for investors, some of which will allow far better investments

By far the cheapest area is Hendon, where the average price was £60,487 last year – this means bargains can be had but not without additional cost or complications

This is in part due to the need to comply with Sunderland City Council’s Selective Licensing criteria, which has been applied to the Hendon area since 2012 (the only area in Sunderland where it is currently applied) and also because the area has a higher than average of non-working residents (social housing represents around 25% of rented accommodation in SR2 and a significant proportion of this figure will be within Hendon)

A degree of caution must also be exercised as prices in Hendon are continuing on a downward trend, with prices 19% down on the previous year and 26% down on 2006 levels – this can’t continue for ever so prices will eventually rally

Less risky investments can be had with ex-council properties in Ryhope – for example a 3 bedroom ex-council semi in Linthorpe is currently on the market for ‘Offers Over’ £91,000 (but has been on the market since January so they may consider ‘Offers Under’…) and will return £495pcm giving £6.5% Gross Yield and a good chance of attracting a long term tenancy from a working family

There’s decent potential for capital growth, given the average price of a Rhyope semi detached was £107,181 in the past year, with prices up 4% on the previous year but still 10% down on 2006 levels

Similarly, a two bedroom terraced 'cottage' in the Grangetown area can make a decent investment, with prices starting at £65,000 for a 2 bedroom property and rents of between £425 and £475pcm

Whilst we’ve advised caution about investing in converted flats within Ashbrooke, there are flats in other parts of SR2 which will make better investments for landlords who prefer that sort of thing

A 2 bedroom flat in the popular modern Beechbrooke development in Ryhope will return around 6.5% Gross Yield and can be picked up for £85 – £90,000. The new Hopewood Park teaching hospital is within walking distance so these flats may become even more popular when this opens later this year, so rents may rise

A good choice for a slightly cheaper investment could be the older Edgmond Court flats in Hollycarrside. Two bedroom flats can be bought from £55k and will return around £350 - £400pcm, so will return 7.5 – 8% Gross Yield

Finally the yields will be lower but there will always be strong tenant demand for apartments in the Royal Courts development just off Durham Road – they’re very close to the City Centre, have secure parking and playing areas for kids and will appeal to a range of professional tenants. Gross Yields will be around 6% based on £495pcm rent and sale prices of around £95,000 for a 2 bedroom apartment

There’s clearly good investments to be had in the SR2 postcode but as always we recommend taking expert impartial advice before making any purchase

Please call on 0191 567 8577 or email for objective & impartial advice on all aspects of property investment in Sunderland

'Probably Needs Work' Bargain Semi (+7% Gross Yield)

We can only see the external shot for this 2 bedroom semi in the popular Redhouse area but the £60k price caught our eye and demands immediate investigation
Even adding £15,000 for improvements onto the asking price will return 7.2% Gross Yield based on a total investment of £75,000 and a very achievable £450pcm rent

We'll update this when more information & pictures are available
Call us on 0191 567 8577 or email for more information

Thursday, 1 May 2014

Echo 24 Apartment - Caution Advised but +9% Gross Yield!

This won't appeal to all investors but priced at £85,000 this Echo 24 apartment may appeal to some

Investors would need to be willing to tap into the International Student market but if so could return 9.1% Gross Yield based on £650pm rent and the £85,000 asking price
You'd need to factor in the hefty service charges and a sizeable annual budget for ongoing rennovations, repairs & furniture replacement

Given these apartments were originally sold for upwards of £160,000 there's clearly room for capital growth but we'd advise that any growth is likely to be in the long term, given there's likely to be more of these 'bargains' coming to the market in the next few years

Call us on 0191 567 8577 or email for more information