This 1 bedroom top floor flat needs lots of work throughout and once completed it will be competing against a lot of similar flats in Ashbrooke but the bargain price makes it worthy of consideration
It's on the market for £29,950 and I'd allow a further £15,000 for improvements so the total investment will be the best part of £45k
Both Sold Prices and Rents in SR2 have fallen in recent years (due to oversupply in both markets) but even so, based on the above and £350pcm rent this will return 9.3% Gross Yield and even with the large quantities of similar properties on the market there's scope for capital growth given most similar 1 bedroom flats in converted properties start from around £65,000
Click here for details http://www.zoopla.co.uk/for-sale/details/34541729?tmad=c&tmcampid=35&utm_campaign=buy-alert&utm_content=contact-type-listing&utm_medium=email&utm_source=alert#zU3sOS5zhkyidXt4.97
Call us on 0191 567 8577 or email neil.whitfield@belvoirlettings.com for more information
This immaculate 3 bedroom semi detached home in Plains Farm will be popular with working family tenants and is 'Ready to Let'
Given the excellent condition both inside and out it limits the scope for building in capital growth through making improvements but it does offer the chance to hit the ground running with a 'lettable' property and may therefore appeal to less experienced landlords
Based on the £109,950 asking price and a realistic and achievable £550pcm rent it will return 6.0% Gross Yield
Click here for details http://www.zoopla.co.uk/for-sale/details/34549268?tmad=c&tmcampid=35&utm_campaign=buy-alert&utm_content=contact-type-listing&utm_medium=email&utm_source=alert#4qdbqmceAxE4QXsG.97
Call us on 0191 567 8577 or email neil.whitfield@belvoirlettings.com for more information
Regular readers of this blog will know that I'm puzzled by a reluctance by many investors to consider the SR5 area north of the River Wear.
This applies mainly to Sunderland locals rather than 'out-of-towners' and may be due a combination of negative preconceived ideas about the area along with a fear of the unknown (as the vast majority of our local landlords live south of the river).
That's a real shame as they are missing out on great investments, which ironically are often snapped up by investors from out of the area who aren't constrained by such preconceived ideas and have a much more open mind.
I often highlight 2 or 3 bedroom, ex-council properties in the SR5 postcode in areas such as Downhill, Town End Farm and Redhouse which would attract working tenants & families who often look to stay in a property long term due to having a close family support network nearby.
It’s possible to pick up properties in the above areas for a better price than in comparable properties south of the river, making them worthwhile investments and making it possible for landlords to expand their portfolios for less.
As an example, the most recent purchase of a 2 bedroom semi in Redhouse was £55,000 paid in July for a property on Rochford Road. This would return a Gross Yield of 9.8% based on an achievable rent of £450pcm (assuming no additional spend was required to bring the property to a lettable condition).
For comparison, the most recent purchase of a comparable 2 bedroom property in the other areas we highlight such as Farringdon (SR3) or Grindon (SR4) was £65,000 & £76,000 respectively (both in June 2014)
Whilst the purchase price may be higher, the achievable rent may be a little higher in Grindon or Farringdon (£475 - £495pcm), so they still return healthy 6.5% - 7.8% Gross Yields, but not quite as good as the example shown in Redhouse.
Investors who prefer leasehold flats rather than houses can also make decent investments in SR5. Regular readers will know we rarely promote flats in or around the City Centre or Ashbrooke but do suggest that the two bedroom flats in more outlying areas built between the 1960's & 70's can make good investments.
The average sale price of such a Moorside (SR3) flat is £78,505 and with rents ranging from £450 - £495pcm Gross Yields of 6.8% - 7.6% can be made. A comparable 2 bedroom flat in Downhill costs on average £59,850 and will return 7.9% Gross Yield based on a conservative achievable rent of £395pcm.
Furthermore we often see bargain flats in this area which can make ideal first investments for inexperienced landlords looking to make an inexpensive first purchase and in doing so build in capital growth - for example a 1 bedroom flat in King Henry Court was bought for £30,000 in June of this year - it needed about £10,000 of work doing to it but in doing so the investor will have built in capital growth in excess of the additional spend - for proof of this a similar size flat in the same block (but in a much better condition throughout) was sold for £47,000 in July.
Whilst the above areas would be chosen primarily for their ability to deliver healthy yields they would not be the areas where an investor should automatically expect to make significant capital growth.
That said, it’s worth noting that when recently looking at house price trends across all SR postcodes the area showing consistently the highest percentage growth is the SR5 postcode with 11.0% growth vs. 2009 values, 7.5% growth in the last 3 years and 6.6% growth within the last 12 months.
What’s more, given competition for tenants is often more fierce in the more established rental areas of SR2, SR3 & SR4 due to a greater supply of properties, landlords who are prepared to look further afield can find that they find it easier to pick up good tenants and therefore have less of a risk of their properties remaining empty.
It's anecdotal rather than scientific but as mentioned above we typically find that tenants in SR5 stay significantly longer than those in some other areas, which is clearly in an investors interests to maximise their rental income and risk fewer void periods.
The above examples prove there’s clearly good investments to be had in the SR5 postcode but as always we recommend taking expert, impartial advice before making any purchase.
Please call on 0191 567 8577 or email neil.whitfield@belvoirlettings.com for objective & impartial advice on all aspects of property investment in Sunderland
This 2 bedroom apartment is in a new Miller Homes development in Seaham and should be popular with young professional tenants or older tenants wishing to downsize
It's on the market for £84,000 and will achieve £495pcm rent, returning 7.0% Gross Yield
Click here for details http://www.zoopla.co.uk/for-sale/details/29286007?tmad=c&tmcampid=35&utm_campaign=buy-alert&utm_content=contact-type-listing&utm_medium=email&utm_source=alert#cppgVQItEXVQOArK.97
Call us on 0191 567 8577 or email neil.whitfield@belvoirlettings.com for more information
How to find a genuine property
bargain has always been near the top of most local landlord’s thoughts &
perhaps that’s never more than now when many Landlords are looking to add to
their portfolio.
I’ve built up an extensive
database of every property sale in Sunderland since the late 1990’s, so I’m
able to give an objective and unbiased opinion on what makes a good property deal
or investment and what you should avoid.
Knowing what’s happening now and what has happened to the property market
in Sunderland,
compared to say Newcastle or Durham, enables me to spot any trends or
opportunities for Buy to Let landlords.
Here are some bargains that I
spotted at the time and made a note of…it’s obvious other people thought the
same as some have now resold a few years later for a very healthy profit.
A 3 bedroom, late 1960’s semi on Acklam
Avenue in Grangetown sold in February 2012 for just over £106,000. Admittedly
it needed work, but what a bargain, because they sold it last May following
modernisation for £152,950 ....a 44% increase in just over 2 years.
I spotted a similar bargain in Sorley Street, Millfield last year - the buyer paid £58,000 in June 2013 for a typical and unremarkable 2 bedroom terraced ‘cottage’, selling in July this year for £74,000, a very healthy increase of over 27% in just over a year.
Clearly for every bargain there’s
likely to be a larger number of ‘money pit’ poor investments that you should be
aware of and avoid – here’s a couple of notable horror stories I’ve spotted.
You’d expect a 4 bedroom semi in
sought after Kentmere Avenue in Fulwell would offer a sure fire guarantee of decent
capital growth but one unfortunate buyer paid £120,000 in May 2013 and sold
again at £90,000 in April of this year, a 25% reduction in value.
No tale of Sunderland property investment ‘flops’
would be complete without a mention of the apartments built between 2004 &
2007 such as River View & Echo24, the most recent example being a 2 bedroom
River View apartment bought new for £168,000 in 2005
and sold in May this year for £72,500, a whopping 57% reduction on what was
paid. You have been warned!!
Whether you’re a current Belvoir
landlord or not or just someone thinking of investing in the Sunderland rental
market for the first time, drop by
our office in Frederick Street for a chat & to get some advice on where the
bargains are or call me on 0191 567 8577 or email neil.whitfield@belvoirlettings.com
Given we always suggest 3 bedroom properties are preferable to 2 bedroom properties (because family tenants tend to outgrow them less quickly...) this Farringdon end terrace property demands further attention
Internally it looks to be in good condition, the gardens could do with a little TLC however
Based on the £84,000 asking price and £550pcm rent it will return 7.9% Gross Yield
Click here for details http://www.zoopla.co.uk/for-sale/details/34525135?tmad=c&tmcampid=35&utm_campaign=buy-alert&utm_content=contact-type-listing&utm_medium=email&utm_source=alert#gLRmoA7Dht6j4ZEJ.97
Call us on 0191 567 8577 or email neil.whitfield@belvoirlettings.com for more information
The Riverview development on Low Street tends to buck the trend of City Centre apartments being hard to rent & at reduced rents - we find that the apartments we manage there are easy to rent out (typically to young professionals or students) and the rents have held firm in recent years
This 3 bedroom apartment could be a bit of an auction bargain - the guide price is £55,000 and the most recent 3 bedroom apartment sold for £75k in 2011, the previous one selling for £103,900 earlier that year
Based on a purchase price of £75k it will return 9.6% Gross Yield based on a conservative £600pcm rent - as it's a leasehold apartment you'll need to take Service Charges into account
Click here for details http://www.zoopla.co.uk/for-sale/details/34413225?tmad=c&tmcampid=35&utm_campaign=buy-alert&utm_content=contact-type-listing&utm_medium=email&utm_source=alert#0aGCevkVYFzM3j0c.97
Call us on 0191 567 8577 or email neil.whitfield@belvoirlettings.com for more information
This mid terraced Hylton Castle property is being marketed For Sale as a 2 bedroom property but with a loft conversion (currently being used as a bedroom) in addition to the 2 first floor double bedrooms, it will give potential family tenants more flexible accommodation
It's offered for sale at £75,000 and based on £495pcm achievable rent and a total investment of £80k (it looks in generally very good condition but the kitchen is a bit dated and could do with updating) will return 7.4% Gross Yield
Call us on 0191 567 8577 or email neil.whitfield@belvoirlettings.com for more information
Apologies for the lack of blog posts throughout August - a combination of School holidays and staff absence has conspired against me!
Now the schools are back and the team have returned from holiday / seem to be in robust health it should allow the regular posts to resume as before!
It's being advertised as OIRO £84,950 and based on paying this asking price and £495pcm rent it will return 7.0% Gross Yield - clearly there appears to be room for negotiation so the Yield should increase further...
