3 Bed House in Chelmsford with Potential yield of 5.2%

http://www.rightmove.co.uk/property-for-sale/property-51404851.html?premiumA=true

Well, we are at the end of another week and gearing up for the weekend, (alright for those, who don't have to go to work on Saturday!)

This house is a great size, even offering a conservatory. 3 beds are also very popular in the rental market as they don't come up very often.

This house has come to the market with a guide price of £230,000, which when you compare it a guideline rental price of £1000 pcm, could give you an annual yield of 5.2%. Condition wise also looks OK, but always best to double check this on a viewing though!

If you have any questions about buy to let, give me a call on 01245 330500

Which semi detached house should I buy in Chelmsford?

Which semi detached house should I buy in Chelmsford?

One of our landlords asked if they should buy a 3 or 2 bed semi detached property to rent out to tenants. The first question I asked them was, what are they looking for from the investment - capital growth in the property or a great yield?

Answering this question will help you figure out which properties you should buy...

The current average asking price (according to Rightmove) of a 3 bed semi in Chelmsford is £319,957 today compared to £267,063 for a 2 bed semi. The 3 bed semi achieves an average rental price of £1,224 per month compared to £969 per month for a two bed semi.

That’s an average yield of 4.3% for the 2 bed against 3.8% for the 3 bed. So surely, the 2 bed semi is the better bet? Well it does offer a better rate of return, but this isn’t the whole story. We also have to consider the capital growth and how they compare. In the last 10 years, since 2005, average property prices have risen 43% for 2 bed semis, but for 3 bed semi’s in Chelmsford, average prices have risen by 55%

If you would like more information, pop in to see us at our offices on Duke Street, Chelmsford.

Chelmsford City centre apartment for Buy to Let...

Good morning folks, on my morning travels today, I came across this lovely property.  They don't come up that often in this block as there are not many in there. They are really good sizes though and also the location is ideal!
http://www.rightmove.co.uk/property-for-sale/property-36040803.html

This particular apartment is really nicely presented as well, (although the colour choice in bedroom 2 may not be everyone's cup of tea), which will appeal to the rental market. Tenants may only be renting, but they still want a lovely home!

The asking price for this property is £225,000 and I would expect to achieve in the region of £900 pcm rent for it, which would potentially generate you an annual yield of 4.8% before any charges etc. Whilst this may not be as high as some of the properties that I have blogged about in the past, it's not always about the high yields, if it;s a nice area, you are pretty much guaranteed not to have any lasting void periods, which means more secure income! Another thing is also the capital growth, a similar property in this block sold a year ago for £172,000, so if this apartment sells at it's asking price, potentially, it could have increased in value by 30%! Way above the Chelmsford average of 3%.

If you would like to know more about buying a property to let, feel free to come i for a chat, my office is on Duke Street and my door is always open.

Potential rental yields of 6.6% in Chelmsford!

Before you go jumping in head first with this one, some inquiries will need to be made to conform a few things. If it seems too good to be true, it probably is!
http://www.rightmove.co.uk/property-for-sale/property-51124738.html

It's in the popular area of North Springfield in Chelmsford, 2 bed apartment at the bargain price of £125,000. It does say offers in excess of this price, so it would be good to get an indication from the selling agent, what region they are looking for. It also says that it is only available for cash buyer, this may be down to it having a short lease, although it doesn't specify, therefore, make sure you find out why.

There are also no internal photos on the details, this could be because it's a bit of a hovel! or maybe it could just be that the agent hasn't got in there yet. Be prepared that you may need to spend a bit of money on it though, just in case.

Rental wise, these 2 beds are really popular and 2 beds in good condition are getting around £675 - £695 pcm. Therefore you could be looking at a potential return of between 6.4% - 6.6%, which is fantastic. 'IF' you have to spend a bit of money on it, for arguments sake £10,000, you are still looking at annual returns in excess of 6%.

Make sure that if you did go for this property though, all questions and queries are clarified before you jump in.

If you have any questions at all about buying to let, give me a call on 01245 330500

Chelmsford investment properties – the eternal bedroom question!

Last week, a Chelmsford landlord emailed me, after reading the Chelmsford Property Blog, to ask if he should extend his terraced house, making an extra bedroom in the loft. He had a builder friend who owed him a favour, and thought it a good way to achieve an ‘inexpensive’ extension.

Having more useable space is generally thought to be consistent with better quality accommodation and homeowners and tenants are prepared to pay for it. If you added a bedroom to a two bed terraced to make a three bed terrace, it could add around 9% to the value of the property.  Looking at semi detached properties, and turn a two into a three bed and around 7% could be added to the value.

However, before you rush off to the planning department there are some important considerations, whether you are a homeowner or landlord.  What would be the cost of making that extra bedroom? The average value of a terraced house in Chelmsford is currently ££240,000 whilst the average value of a semi detached house is £294,900, meaning to make money the cost of the extension would need to be less than ££21,600 on the terraced property and ££20,640 on the semi detached house. 

Talking to a number of trade’s people in the City, most are booking up into the New Year. Also, no matter how good a friend he was, I know of no builders that would charge as little as that! Maybe the builder was just thinking of a bit pointing work on the chimney!

Well, that got me thinking about how bedrooms affect rental prices and rentability. Interestingly, you will see below that whilst bedrooms do have an effect on the rent that can be achieved and the rentability of the property – the difference does not really warrant the expense, hassle and trouble of extending.

50% of the one bed properties on the market to rent in Chelmsford have a tenant paying an average rent of ££684per month

57% of the two bed properties, have a tenant paying an average rent of £857 per month

53% of three bed properties costs a tenant an average rent of £1091 per month

42% of the four bed properties have a tenant with an average rent of £1402 per month

Now, if you want to increase the value of your property, be you a Chelmsford landlord or homeowner, there are things that cost a lot less than building extra bedrooms. Spruce up the exterior, decorate all the rooms, install fresh carpets and curtains. For homeowners, a matter of a few hundred pounds will add thousands whilst for landlords, these things could add a potential 10% to the rent that you can achieve.

If you would like to discuss this topic in more detail or anything related to residential lettings in the Chelmsford area then please don't hesitate to contact me on: 01245 330500

Potential 5.8% return on The Village, Chelmsford

This property on The Village, just off Writtle Road has caught my eye this morning, as I thought it seemed pretty reasonably priced for a 2 bed flat. Having looked at the photos, maybe it could do with a little bit of TLC, maybe a couple of carpets being changed & bathroom sealant being replaced, but nothing major. (Of course an internal viewing is always best to determine what needs to be done) But even so, it has come to the market with an asking price of £152,950. 
http://www.rightmove.co.uk/property-for-sale/property-54139424.html

Bearing mind, this type of property in this area rents for around the £750 pcm mark at the moment, you could be looking at an amazing 5.8% annual return! Even if you spent £5k on it to freshen it up, you could still get a 5.6% return. To me, this property seems like a no brainer on this front. 

But before you jump in head first, on;t forget that you need to investigate what the service charges and ground rent will be, as you should take these into account as well. 

If you would like to know more about buy to let, come on down for a chat and a cuppa, my office is on Duke Street, opposite the back entrance of the council offices

1 bed apartment in Chelmsford, could be a little Buy To Let Gem!

http://www.rightmove.co.uk/property-for-sale/property-35961240.html

Good morning, was having a little look through the websites this morning and came across this property. It says that it is available only for an investment buyer, which leads me to believe that it is being sold with a tenant in place, however there are no details about this in the description. Would be worth making a call to the agent to see what the deal is there.

These little apartment are good for rental purposes, they always Let easily when they come to market, and if the opportunity is there to buy a ready made buy to let property, with a tenant in situ, it makes sense. Of course at the moment you need to honor the rental amount that is being paid by the tenant in the property, which I imagine would be in the area of £650 - £675 pcm, going by what others have rented in the block for in the past. Even if you go by the lowest rental figure and compare it to the asking price of £154,000, you are still looking at a potential annual yield of just over 5%, whichis pretty good. Any higher rent than this and of course if you manage to buy it for slightly less, it could be even better!

IF you would like any advice on buying a property for Let, feel free to give me a call 01245 330500

Chelmsford – Battle of the Postcodes?

 

I was asked last week if postcodes make a difference to property values. In swanky West London, the difference between SW3 and SW10 can make values drop or rise by thousands, even millions of pounds. We have a slightly different clientele in Chelmsford, however after doing some investigating, I did find out some interesting info.

The main postcode areas of the City are CM1 and CM2, with villages to the North and East being CM3 and the villages to the South CM4. Interestingly, the difference in growth in the different postcodes, is very minimal. The postcode with the best performing housing market over the last 12 months has been the CM2, with average values rising by 5.3%. However, in a very close second and third come CM1 and CM3, with rises of 5.2% and 5.1% respectively in the same 12 month period with CM4 seeing more modest, yet still healthy rises of 4.8%. Look back at the areas over a longer period though and the differences are similar still. Over the last 5 years, values in the CM1 have risen by 17.8%, CM2 with a close second at 17.7% and CM4 17% and in a very respectful fourth, CM3 at 15%. 

Property values are only half the story when it comes to property investment. The average yields tell a slightly different story. CM2 has current average yields, based on what is on the market now at 5.2%, whilst CM1 has current average yields of 4.8%. As we go into the villages, CM4 conforms with the norm in that yields tend to be lower in the villages with an average yield of just 2.4%, as property values in villages, especially nice ones, tend go up very quickly, but the rents don’t correspondingly go up as much. CM3 is performing slightly better, with current average yields of 3%. Before you all start buying in Northern and Eastern villages (CM3), the yields are high because of higher value properties to rent at the £2500 to £3500 per month region, thus pushing the averages artificially high. My long term records show yields always tends to be similar (around 2.3% to 2.6%) in CM3 to CM4’s.

Chelmsford City Centre apartment with a 5.6% return

http://www.rightmove.co.uk/property-for-sale/property-51155800.html

This modern 1 bed apartment is in the popular Marconi Plaza development which is within easy reach of Chelmsford City centre and the train station, ideal for the professional tenant market. This property is also currently tenanted and has the option to be sold with the tenant in place. 

It has just come to the market for offers in excess of £170,000 and you are looking at a monthly rental amount of £800 pcm, therefore, if you bought it for the bottom line price of £170k, you are looking at a potential annual yield of 5.6%, even if you had to pay £175,000 for it, you still would be looking at an annual yield of 5.4%!.

These properties are getting snapped up like hot cakes at the moment, so if you are interested, get in touch and we can sort you out a viewing.
01245 330500 / sales.chelmsford@martinco.com

Ex-council properties in Chelmsford... Are they good Buy To Let investments?

 

In previous articles we have found that ex-council properties can achieve good annual yields in the high 6% range. Yet their average values tend to stay quite stable when we compare this to the average capital growth on the more modern estates such as Chelmer Village or more established areas such as Old Moulsham, which have had a more significant rise.

Saying this though, there are a couple of anomalies, if we look at the Melbourne area, a three bedroom semi-detached property on Melbourne Avenue sold for £210,000 in April 2007 and it was sold again earlier this year for £265,000, which is a return of 26% in 8 years. Another example of good capital growth from an ex-council property is another three bed semi on Melbourne Avenue which was sold April of last year for £215,000, following an increase in value of around 34% in just less than a year.

These examples however can’t be relied on as what happens generally in this area, there were many other properties that had seen increases in value of 6.7% in the space of a year (3 bed semi Melbourne Avenue) and another with a rise of 15% in  the space of 18 months (3 Bed semi on The Green). My belief is that the examples with large capital growth are down to the owners being able to pick up a decent sized property, in not so great condition, doing a lot of work to it to improve the condition & upgrade it and then selling on for maximum profit. These properties are becoming few and far between now. 

One of the best performing properties for capital growth in 2015 that I have spotted so far was bought in March 2012 for £173,000 and has recently sold for £230,000. This is a significant return of 33%. However, this was not an ex-council property it was a Victorian terraced house on Marconi Road!

If you would like some advice about buying to let, please come and see us at our office on Duke Street.