2 Bed apartment in Chlemsford with 5.2% return...

Hi there, just picked out another great potential rental property here. This development is quite popular, the flats are modern, it's not too far from the City centre to still appeal to the commuting professionals and they are great sizes. It's just off Broomfield Road.
http://www.rightmove.co.uk/property-for-sale/property-35357715.html

It's just come to market at a price of £205,000 with an out of area agent, I don't feel that this is a bad price for it, especially as it comes with parking as well. Of course as with any flat, you will need to enquire as to what the service charges and ground rent would be before steam rolling ahead. 

From a rental point of view, these flats rent out for around the £895 pcm mark, so you could be looking at a gross annual return of 5.2%. 

At the moment in Chelmsford, the average yield is probably about the 5% mark, so if you can get a property that can produce you around this, you're not doing too badly.

If you would like any advice on buying a property to let, give me a call on 01245 330500.

Happy hunting!

House of horrors - With Halloween just around the corner, how can you transform a scary property into a hot property…

With Halloween just a few days away, where the streets will be filled with ghouls and ghosts, of different varieties. Whilst this annual fright night is based on fiction and designed to entertain the children, it is true that if a rental property is the victim of a difficult history, a letting agent could find that it is more difficult to let.

Houses that have been used by previous tenants as brothels or cannabis factories – or have been home to squatters – can cause problems when trying to find a new tenant. Even properties that have been owned by uncaring or corrupt landlords can develop a long-lasting stigma that will stay with the property long after it has been sold on to a new investor.

In the past we’ve taken on rogue properties, usually from a private landlord that have previously been used as a cannabis factory or used as a brothel. While it can be difficult to manage a property with a rogue reputation, it is possible to raise its profile within the community. Often the stigma can be very much in our own minds and will naturally pass away quickly. Even if the story of the property gets in the press, tomorrow there will be more exciting news, which over time, helps locals forget.

If a landlord is faced with a property like this, my suggestions would be to change the front door or paint it a new colour, develop the front garden to make it look and feel different, then give the house a new name and display it. It would also be helpful to keep the rental price aggressive to ensure lots of potential tenants are interested. It may also be a good idea to give new tenants a good behaviour reward (or something similar) for their first year or so to help encourage a sense of responsibility.”
But, of course, the best solution is to avoid a property gaining a bad reputation to begin with...

My first advice to landlords is to use a reputable agent, most criminals find properties using the private landlords advertising in local papers, knowing they are unlikely to conduct credit checks and inspections, agents will carry out routine property visits and report back to the landlord as well as undertaking proper references. In this climate a lot of small reference agencies are opening up offering very cheap fees, but how reliable are they? Owner-run businesses, in my opinion, will give a far superior and honest service. My personal belief is that we need to push the government to regulate lettings agencies and have fines in place for negligence or complete incompetence.

So, to sum up, here are my 5 top tips to let ‘Rogue’ properties...
1) Paint the front door a different colour or change it completely
2) Give the property a new name and invest in a sign
3) Transform the front of the house by adding trellis and plants, or re-designing the front garden
4) Ensure lots of interest by keeping the price competitive
5) Inform locals that a professional lettings agent has taken over the property and allow the agency’s good reputation eclipse the property’s bad one.

Lovely 1 bed house in Chelmsford, great for rental...

Good morning everyone, shame about the weather today, hopefully I don't have to go out too much today! 
Whilst cosied up in my office this morning, I happened upon this lovely little house. The price is top end of what it should be at £174,995, but this reflects the condition in my opinion. You probably wouldn't have to do anything to it to get it ready for a tenant.
http://www.rightmove.co.uk/property-for-sale/property-55546142.html

It is also Freehold, which is a bonus with these houses, some of them are leasehold, but not this one.  

Rental wise, you would be looking at a realistic rental price of £725 pcm, which when you work out against the purchase price, could look to generate you an annual return of 4.9%, which still isn't too bad. OF course if you can do a bit of negotiation on the asking price, even better!

If you would like any advice on where you should be looking to buy your investment property, feel free to pop in for a chat, I'll get the kettle on.

Chelmsford Landlord’s mortgages top £1.6 Billion!

The hot topic of discussion of Chelmsford’s movers and shakers is the subject of the Chelmsford Property market, but in particular, buy to let. Landlords are buying up buy to let properties quicker than an ace Monopoly player.. or so it would seem if you read the Sunday papers. So is the buy to let market a sure fire way to make money?  Is it something everyone should be jumping into? The answer is Yes and No! 

Firstly, the government gives tax breaks to landlords, as it allows the mortgage interest payments on a buy to let property to be tax deductible. Also, a landlord only has to pick a property at random and agree a price, then find a modest deposit of 25% (often by remortgaging their own home) which for an average Chelmsford terraced house, would mean finding £63,330 (as the average Chelmsford terraced house is currently worth £253,320) and borrow the rest with a low interest rate buy to let mortgage.  Finally, the landlord would rent out the property in a matter of hours for top dollar and live happily ever after, with rent then covering mortgage payments, & loads of money to spare and come retirement have a portfolio of property that would have quadrupled in value in 15 years. Sounds wonderful – doesn’t it? Or does it???

Let us not forgot that the 0.5% Bank of England base rate is artificially low. The international money markets can be fickle and if interest rates do rise quicker and higher than expected because of some unforeseen global economic situation, that monthly profit will soon turn into a loss as the mortgage will be more than the rent. Even though tenants are staying longer in their rental property, tenants still come and go and my guidance to landlords is they should allow for void periods, plus the maintenance costs of a rental property and of course, agents fees... all things that eat into that profit.

Interestingly, by my calculations, there are approximately 7,600 Chelmsford landlords owing in excess of £1.6 billion in mortgages on those Chelmsford buy to let properties.  An impressive amount when you consider Chelmsford only has 0.22% of all the rental properties in the Country. It really does come down to a number of important factors going forward to ensure you are water tight for the future, such as fixing mortgage rates for the first few years.

However, one thing I do know is that buy to let is a long term investment, it’s a 10, 15, 20 year plan and property prices will go down as well as up. You wouldn’t dream of investing in the stock market without advice, so why invest in the Chelmsford Property Market without advice? We give bespoke detailed advice to our landlords to enable them to spot trends in the Chelmsford Property Market before others, enabling them to buy better properties at better prices. For example, did you know that Semi detached properties are selling for around 2% higher than 12 months ago in Chelmsford, yet detached properties are selling for 5.3% more (with every other type in between). This means we can advise on which properties will go up in value better (or lose less if property prices drop), we can also advise which have lower voids and which properties have higher maintenance issues.  

Ready to go investment in Chelmsford...

Good afternoon everyone, I hope you are all keeping well. I try not to push our own stuff, so that you guys don't think we are being biased, but we have just been instructed on this property and it could be a great little investment property.
http://www.rightmove.co.uk/property-for-sale/property-51914152.html?premiumA=true
It's being really well looked after by the current tenants and they have indicated that they would like to stay there for the foreseeable future.

It has come to the market with a competitive asking price of £155,000. The tenants that are currently in the property are paying £725pcm. Therefore, based on these numbers, you could be looking at an annual gross return of 5.6%. The service charges we have been advised by the owner are also fairly reasonable at £700 for the year (subject to legal confirmation).

If you would to book a viewing on this place, you better be quick, interest is hotting up! You can contact our sales team on 01245 330502

Chelmsford Landlords love their Bricks and Mortar

 

The Land Registry have just released their latest set of figures for the Chelmsford Property market. It makes interesting reading, as average property values in Chelmsford rose by 0.8% in May. This leaves average property values 9.7% higher than 12 months ago, meaning the annual rate of growth in the City is still steadily rising. When we compare Chelmsford against the regional picture, the East of England property values rose by 1.7%, leaving them 8.8% higher than a year ago. 

However, the thing that concerns me is that the average number of properties changing hands (ie selling) has dropped substantially just in the last 6 months in the town. In December 201, 105 properties sold in Chelmsford but in May 2015, that figure dropped to 72.  I have been in the Chelmsford property market for quite a while now and the one thing I have noticed over the last few years has been the subtle change in the traditional seasonality of the Chelmsford property market. It has been particularly noticeable this year in that the normal post Easter flood of properties coming onto the market was not seen. This has made an imbalance between supply and demand, with less houses coming onto the market there is simply not as much choice of properties to buy in Chelmsford and with the population of Chelmsford ever increasing; this will generally strengthen house price growth for the foreseeable future.

So what does all this mean for Grantham landlords or those considering dipping their toe into the buy to let market for the first time? For many people, buy to let looks a good investment, providing landlords with a decent income at a time of low interest rates and stock market unpredictability. 

However, if you are thinking of investing in bricks and mortar in Chelmsford, it is important to do things correctly. As an investment to provide you with income, for those with enough savings to raise a big deposit, buy to let looks particularly good, especially compared to low savings rates and stock market yo-yo’s. I must also remind readers, landlords have two opportunities to make money from property, not only is there the rent (income), but with the property market bouncing back over the last few years, property value increases has spurred on more investors to buy property in the hope of its value continuing to rise.

Savvy landlords with decent deposits can fix their mortgages at just over 3% for five years, making many deals stack up. Nevertheless, low rates cannot stay low forever, because one day they must rise and you need to know your property can stand that test. I saw some Chelmsford landlords struggling in the mid noughties, when interest rates rose from 3.5% in July 2003 to 5.75% in July 2007. That might not sound a lot, but that was the difference of making a £100 a month profit in 2003 to having to make up a shortfall in the mortgage payments of £100 per month in 2007.

Its true many landlords were thrown a life raft when the base rate dropped to 0.5% in March 2009. Whilst interest rates have remained there since, mark my words, they will rise again in the future. However, even with the potential for costs to rise, demand for decent rental properties remains high as there are ever more tenants in the market, driving up demand and thus rents. The British love of bricks and mortar plus improving mortgage deals also add up to fuel the buoyant Chelmsford property market.

If you are planning on investing in the Chelmsford property market, or just want to know more, things to consider for a successful buy to let investment, one source of information is the Chelmsford.

Chelmer Village Chelmsford, ready made investment...

Happy Friday everyone, thought I'd end the week with a little ready made investment. This 2 bed apartment has the benefit of being sold with a tenant in place. The tenancy that is in place is up till February 2016, It would be worth inquiring as to whether the tenants are looking to stay longer than this. 

Condition wise, the property looks fairly good, hopefully minimal maintenance needed.
http://www.rightmove.co.uk/property-for-sale/property-55083902.html

Beresfords have just listed this property with an asking price of £165,000, which doesn;t seem too unrealistic. The tenants that are there are currently paying £700 pcm. This could generate you a gross yield of 5% straight away. When it comes up to renewal, you could potentially put the rent up to £725, which would increase your return to 5.2%... every little helps.

There are many more properties out there coming to market, which would be a suitable buy to let investment, but I can;t highlight them all! If you see a property that you like and would like some advice on it suitability for a rental property, e-mail me the link over and I will give you my honest opinion. stephen.frost@martinco.com

What to look for when buying property in Chelmsford...

I was talking to a landlord recently and they asked me for my opinion on what to look for when purchasing a Buy to Let property. One piece of advice I was able to offer was that a good property should sell when you need to release funds. So, if you are a landlord considering buying a property to let out, you want to buy a property that is saleable.

You can work out how saleable the properties in a particular street are by comparing the number of house sales to the number of properties in that street. The higher the number, the more saleable the properties are.

So, having done a bit of research, in Chelmsford, one of the most saleable streets is Anchor Street, it’s a small-ish road with only 22 properties in the street but in the last 10 years, there have been 28 property sales which is an impressive 127% sales to properties. Other streets in the top 10 include Fotinbras Way at 100%, Chelmer Road at 81%, Wicks Place at 74% and Gerard Gardens at 73%. 

Whether you are landlord of ours or not, feel free to pop into our office on Duke Street for our opinion on what to invest in or not, as the case may be.