Wow – what a difference 2 years make. This 2 bedroom maisonette on Ashdown Drive
has just been listed by King & Chasemore at £225,000. You can view the details by clicking the
link:
Back in 2014 I blogged when these types of properties were
being marketed for £170,000. The £55,000
extra on the price of the property is a 32% increase in capital value. Great news for the current owner but the
adverse effect is to reduce the yield for the investor purchaser.
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| Ashdow Drive, Tilgate |
Rents have increased too over the last two
years but not by the same 30%. We would
rent this property for £975 in today’s market, which in itself is a respectable
increase of 15% over the last two years but it now means the yield has been
reduced to 5.2% from the higher 6% when I published the original blog. With the banks base rate not moving from its
lowest ever position of 0.5% even the reduced yield of 5.2% looks very
attractive. Investors would need to remember
the new stamp duty rules will attract a charge of £8750 on this transaction but
currently stamp duty costs can still be reclaimed through the capital gains allowance when the property
is sold on.
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