Lovely 2 bed apartment in Chelmsford for Buy to Let...

I saw this property this morning and thought it looked a little bit tasty, so I wanted to share it with you all. 

It's a modern apartment at the bottom of Moulsham Street, big ticks on the location front. Looking at the photos, the condition looks to be pretty good and well presented, another big tick on the letting front!

I would expect a property like this to be let for at least £850 pcm, which if you calculate it against the asking price of £200,000, could potentially generate you an annual yield of 5.1%. As with any leasehold property, make sure you check out what the service charge information is as this will have an effect on your overall return. 

If you would like any advice on a particular property you have seen and wanted an honest opinion on what it would rent for, feel free to pop the web link on an e-mail to me. stephen.frost@martinco.com

Happy hunting!

Why should you consider buying to let in Chelmsford?

 

We have mentioned in previous articles about the difference between Chelmsford and the surround towns, such as Witham & Braintree, this always gets a response from people asking me lots of questions. This time, I wanted to highlight, why you should be looking at buying a property to let in Chelmsford.
Many people in our part of Essex, over the last few years, have seen the buy to let market become all about nest egg investment. It has been fuelled by pitiful interest rates on building society savings and reflects the fact that building society savings accounts are paying half a per cent interest and pension returns are struggling to match expectations, turning more and more people into landlords to secure their future.
So what can you expect from your rental property investment? In the short term, rental yields are important, and in Chelmsford, the average annual yield is in the order of 4.5% per year. However, that is based on averages, and as most landlords in Chelmsford tend to buy starter home homes, apartments and terraced houses, the majority of which are achieving 5% to 6.4% per year depending on location and price in the City.

In the long term though, the question of capital growth is as important, if not more important (because if you have great short term yields, but the value of the property doesn't keep up with the rest of the market, you will have an asset that in real terms is dropping). As we mentioned in a previous article, average property values in Chelmsford currently stand at £337,324. Property values in Chelmsford have risen by 19.4% in the last 5 years. On the other hand, property investment is a long term game, so I wanted to share with you the research I did for a couple of Chelmsford landlords.
Roll the clock back 10 years to 2004/2005 when the average value of a property in Chelmsford was £177,700. 15 years back to 1999 makes really interesting reading, as the average Chelmsford property value was only £107,800.  30 years ago was around £50,000 and just for a bit of fun, we looked at 1974 at it was around £14,800!
So, not only can you get a better return on your investment with regards to the annual yield, compared to savings accounts at the moment, you also have got the additional capital growth with a property. Chelmsford is also still developing, with more properties and industry being built, this should make for a stable market, bringing new people to the area. This will also keep the demand for property high, which will maintain and grow the property prices further.

5.5% Yield on this 1 bed apartment in Springfield, Chelmsford...

http://www.rightmove.co.uk/property-for-sale/property-49825087.html

Good morning! on my morning Rightmove travels, I came across this little 1 bed apartment for sale in North Springfield, with a guide price of £115,000 - £125,000. This type of property is exactly what the market needs at the moment. With the influx of brand spanking new 1 & 2 bed high spec apartments coming to market, the lower end of the market is in need of supply!

These apartments are quite basic, but they are good sizes and the location is quite popular for renters. This particular one looks as though it's got radiators, which means that the heating may have been upgraded to gas, which is a bonus. Most of these have still got the original storage heaters. Of course you will need to double check this with the agents to make sure this is the case. 

1 bed apartments in this area, easily rent out for around 575 - 595 pcm at the moment, so even if we are conservative and base our calculations on the bottom figure, you could still be looking at an annual return of 5.5%, which is pretty good. 

Before you go jumping in feet first, check out how many years are remaining on the lease, a lot of these properties in this area have short leases, this could cost you money in the future when you come to sell it to extend. When buying an investment property, you need to make sure you have your eyes wide open. 

If you would like any advice on buying a property to let, feel free to givr me a call 01245 330500

Brilliant rental property in Chelmer Village, Chelmsford

Brrrrrrrr.... bit chilly out there isn't it!

Thought I'd warm the 'ole cockles up with a tasty property treat this morning. Just check out the link below.
http://www.rightmove.co.uk/property-for-sale/property-38018889.html

This house looks really lovely and in pretty good condition as well, perfect for what tenants are looking for. It's also located in Chelmer Village which is again a bit of a lettings 'Hotspot'.

It has just come to market with William H Brown with an asking price of £200,000. Which to me, doesn't seem to be too unrealistic, given the condition. Similar properties to this have rented in the area for around the £900 pcm mark. So when we do our calculations to get our annual yield, you could be looking at a gross return of 5.4%.

This is a pretty good return for an investment property, I suggest that if you are interested, you better get yourselves an appointment booked pretty sharpish so that you don't miss out.

As always, my door is always open. If you would like a coffee and a chat, come on in, my office is on Duke Street

Interest rates set to rise – How will that affect the Chelmsford property market?

 

There’s been a lot of talk in the press recently about how the Bank of England has been indicating recently that UK interest rates will be going up in the not too distant future. Therefore, if you are one of the 27,282 homeowners in Chelmsford, who own your own home with a mortgage, then you need to consider your options and start to budget for an interest rate rise. However, if you are a landlord, who owns one of the 8,349 rental properties in the City, whilst your exposure to interest rate rises is lower, it is most certainly something you should be aware of. 

Since the spring of 2009, British interest rates have been at a record low of 0.5%. It’s not a case of if, but when, they will rise. Some people think it will be before Christmas, although I am of the opinion, it will early in the New Year around Easter time, when they do rise. I also expect those rises will be slow, steady and limited. It depends on what is happens to UK wage rises, UK inflation and the general state of the British economy. Nevertheless, as much most of us in Chelmsford

 would love to pull the shutters and stick two fingers up to the world, we have to recognise we are part of a global economy and global economic worries still exist to prevent an abrupt and instantaneous rate rise.

Those Chelmsford landlords who do have a mortgage, need to realise that as interest rates rise, their monthly mortgage costs rise. It’s easy to say you will look at your mortgage next month, then, before you know it, Christmas will be here!  Don’t forget, mortgage lenders have always removed the juicy low rate mortgage deals a few months before interest rate rise. Speak to a qualified mortgage arranger, there are lots of them in Chelmsford and seriously consider fixing your mortgage rate now.  You didn’t buy your Chelmsford buy to let property for it to become a millstone around your neck. It’s all about mitigating your costs and maximising your income to make your Chelmsford buy to let property the investment you want it to be.

However, on the other side of the coin, two in three landlords who have bought property since 2007, have done so without a mortgage. A rise in interest rates might be a good thing. Let me give you some background first, then I’ll explain why. Chelmsford landlords have see their return on investment for their Chelmsford buy to let property, over the last 5 years, perform very well indeed with Chelmsford property values rising by 19.44%. However, when rates do rise, whilst more expensive mortgage rates will ease the demand for borrowing, on the other hand, it may temper house price growth, making the property market more competitive... and therefore, we should see the return of some bargain property buys in Chelmsford! 

5.6% Yield in The Village, Chelmsford...

Well, we're here again at the end of another week... soon be Christmas!!

I thought I'd take a bit of a risk with this one. It's an apartment on Parkinson Drive, in a development known as 'The Village' which is very popular with landlords and tenants alike.  The reason I wanted to point this one out is because of the price, it seems to be on the cheap side with a guide price of between £155,000 - £165,000. There are other properties in the area coming on and selling for nearer the £170k - £175k mark, so make sure you go in with wide open eyes on this one, there's probably a reason! Another telling fact is that there are no internal photos on line, another warning. But if you manage to get it cheap enough, it doesn't matter if you need to spend a few quid on it.
http://www.rightmove.co.uk/property-for-sale/property-53559197.html

Similar properties in this area are renting for around the £775 pcm mark at the moment, therefore you could be looking at a gross yield of 5.6%! not too shabby is it.

It's definitely worth doing a little bit of research on this property to see what the situation is, because you could end up with a corking little buy to let property. 

If you would like any pointers on where to start your property search, give me a call and I'll point you in the right direction

Chelmsford Property Values 8.9% higher than year ago

Chelmsford property values rose by 1% last month, meaning they are 8.9% higher than 12 months ago. Overall, I expect future property price growth to remain firm, built on the foundations of an improving market, strengthening economy and very low mortgage rates. In fact, talking to a number of other agents in the city, mortgage arrangers and solicitors (all of whom have their direct finger on the pulse of the Chelmsford property market), the steady long term growth in Chelmsford property prices tied in by strong demand conditions so far this summer, alongside an underlying lack of supply and the continued low mortgage rate environment, means the slow but steady upward momentum of the Chelmsford property market is likely to continue. 

However, there are a couple points I wish to highlight as all my blog readers will know, I like to give a balanced and honest opinion of what is happening in the Chelmsford property market.

Interest rates first – It has been announced that the Bank Of England will be seriously considering raising interest rates around Christmas time. An increase in interest rates will temper demand & result in a marked slowdown in house price growth. Now I am not a mortgage broker and can’t give advice, but rates are only going in one direction, so, landlord or homeowner, this might be a time to consider fixing your mortgage rate?  Don’t say I didn’t warn you!

Tie this in with the stricter mortgage lending rules which were introduced in 2014, this means homeowners will need to be realistic in their pricing if they want to sell. Reading other recent reports though, property owners have continued to pay off mortgages at a faster rate while mortgage rates have been low. Therefore, when mortgage rates rise, the affect on home movers sentiment which, given the shortage of supply, would result in a marked slowdown in the rate of house price growth.

Shortage of Supply – As I have mentioned in previous articles, the number of houses on the market in Chelmsford is at an all time low. One reason is the large number of buy to let landlords who have bought Chelmsford property over the past 15 years. Unlike first time buyers who tend to move on after a few years, landlords tend to keep their properties longer, meaning there are less properties coming onto the market, thus restricting supply and sales. In fact over the last 3 months, only 5,903 properties in the Essex County Council area have changed hands and sold, compared to 6,720 in the same time frame in 2014, a significant drop of 13%!

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, drop me a note to stephen.frost@martinco.com

Fantastice Buy to Let property in Springfield, Chelmsford ...

Now, this is a lovely 3 bedroom house, in a fantastic location for families, which is the type of market you will be appealing to with this type of buy to let property. People specifically move to this area to get into the catchment for the local schools because the reputation is so good! 

This house clearly looks loved from the photos, so from a buyers perspective, not much will need to be done to it once you own it.
http://www.rightmove.co.uk/property-for-sale/property-52047937.html?premiumA=true

The asking price is £174,995, which seems to be the going rate at the moment for these types of property, they are so popular in general and this is pushing the prices up and up! this is a good sign for buyers as they should continue to grow in price, therefore meaning you are sure to end up with some money in the property, when you come to sell it. 

Rental wise, you would be looking at approximately £1100 pcm, therefore this could generate you an annual yield of 4.8%. All in all, this would be a great little buy to let property, not only for capital growth, but also for yield. 

If you would like any advice on your investment property search, please do not hesitate to contact me 01245 330500

Lovely house in Chelmsford for Buy to Let

Good morning. I've come across this property today and whilst the return may not be as high as some of the City centre flats at 4.7% (gross) But still at this level, it is not a bad return, especially when you take into account that this property is Freehold and therefore won't have any service charges or ground rents to take into account off your bottom line.

This house itself appears to be in pretty good condition, it's a good size and properties in this area, which is Moulsham Lodge,  do generally rent out quite well due to the local schools being quite sought after. We have recently rented out a similar property in this area for £900, but it didn't have a conservatory, so you could be looking at about £925 pcm / £950 pcm. So, when you do your calculations against the asking price of £240,000, brings us to our annual return of 4.7%. 

If you don't like the look of this one, but have seen another property that you would like some advice on, ping it through on an e-mail to me and I'll happily give you my honest opinion on it's 'rentability'.
Stephen.frost@martinco.com

Buy to let property in Chelmsford with Potential...

Good morning, been doing a little bit of property searching this morning and came across this property, which I thought was worth putting out there for you all to see. It needs a little bit of imagination with the decor, replacing the carpets and kitchen would make a world of difference.
http://www.rightmove.co.uk/property-for-sale/property-52090165.html 

Located on Chester Place which is just off Broomfield Road, still walking distance of the City centre & train station. Great for investment purposes as it will appeal to wide rang of people. It has come to the market with an asking price of £147,500 with Beresfords. Bearing in mind there are some works that would need to be done, if you over-estimated a spend of £10k, you still can't go far wrong.

We have rented similar properties to this for around £675 pcm, so even taking into account the improvement spend, which brings the total investment up to £157,500, you would still be looking at an annual return of 5.1% (gross). 

If you would like to pick my brains about buying for investment purposes, pop in for a coffee and we can have a chat!

Do Apartments in Marconi Plaza make good investments for Buy to Let?

I was talking to a potential landlord who lives in Beaulieu Park the other day. He wants to purchase his first Buy to Let property and has noticed our rental index and previous articles, so was interested in getting to know the industry a little bit more. He had also noticed that quite a few apartments are coming up for sale in the Marconi Plaza development in Chelmsford city centre and quite likes the development.

He’s looking for a good return on his investment, as the money’s not really doing anything in the bank. He had noticed that there are a lot of properties available for Let in the same development, so I thought I would look into this in a bit more detail for him. This is what I found...

In the last year, 23 apartments have come to market in Marconi Plaza, with 13 currently either under offer or sold subject to contract at an average price of £208,561. The average rental price in the development at the moment is £1024, which could produce a fantastic 5.8% annual yield.

However, this isn’t the full story. As the development is quite swish and luxurious, the service charges and ground rents quite high. Therefore, before you go jumping in feet first, you must take this into account when doing your calculations.

Also, whilst the development has seen a rise in property values in the last year of 3.6%, this is below the Chelmsford average of 4.8%, but this is one of those classic examples of ‘What is more important, high yield or capital growth?’

If you would like to talk to us about your potential investment criteria, please come into our office on Duke Street.