Investment Opportunity in Broadfield - 5.2% yield

I had discounted this property when it was first listed in June with neighbouring agent Taylor Robinson.  The original price was too high for investors however the recent price reduction of £15,000 makes it much more attractive. 

http://www.rightmove.co.uk/property-for-sale/property-30647433.html

A conservative rental figure of £850 per month will give a 5.2% yield and looking at the photo’s it is almost in a “move in” condition and it has a relatively new boiler fitted.

Admittedly it is not the prettiest house in the village but tenants will be attracted to the large garden and it is in the perfect position to catch either the No.10 or No.20 FastWay routes direct to Gatwick.  And who knows, its already had one price reduction – with a bit of haggling the price may come down even more.

Take advantage of a 6% yield in Tilgate

I have previously highlighted a Tilgate property & if you missed it here is another.

Offering both rental yield and capital appreciation it would make a solid purchase. This great little maisonette in the Tilgate area of Crawley is on to the market with local agent Choices.

http://www.rightmove.co.uk/property-for-sale/property-47256398.html

Having checked through the data these properties were being sold for £130,000 in 2006, today’s marketing price represents a 30% increase in capital value.  I have let a number of these properties, the last one rented at £850 per month which at the current marketing price is a 6% yield.

Famed for its park, nature centre and lake, the Tilgate area of Crawley is favoured by young families because of the access to schools and the extensive leisure facilities and is also home to the well-equipped K2 centre with pools, gym and sports facilities.

Is The Crawley Market Booming?

The Crawley property market appears to be booming so we took a look through the results of the recently published census and housing survey to see what it could tell us.  The data was compiled a couple of years ago and it is true to say that since then the house prices have risen substantially but prices do not tell us about the type of housing stock & demand.

The statistics show that Crawley & the surrounding villages are a landlords paradise with a good proportion of privately rented property.  Within this area 48,334 households, just over 6 out of 10 properties are owner occupied.  A further 22% are social rented properties which is a definite nod to the new town roots of Crawley in the 1950’s.  That leaves the remainder, just about 18% or to put a number on it, 8000 households as rented properties.  This puts Crawley firmly in the centre of the national average, the latest English Household Survey reports that the national average for England to be 18% but there is a wide variation around the regions.  For example our colleages in the Chelmsford office have a private rented sector that accounts for just 11% of their local property market.

So if there is a high proportion of rented property in Crawley does that mean it is harder to find a tenant or not enough tenants to fill the thousands of rental houses and flats.   In the lettings industry we have traditionally worked on the basis that 5% of the private rental portfolio will be “on the market” at any one time.  5% of the rental property around Crawley would be the equivalent of 406 properties.  I have just checked the Rightmove website & it is listing just over half that amount at 225.  From experience I know that a good proportion of those properties will already be let to subject to contract whilst the new tenants are being referenced.  In reality the figure could be 50% lower than the 225 properties listed on the portal.

Is the Crawley rental market booming?  If only 100 of the eight thousand rental properties are available to let it would suggest demand is incredibly high and could explain why Crawley is a firm favourite for investment landlords.

House values in Holder Road, Maidenbower rose by £355 a week

I was discussing the property market with one of my landlords who had purchased a property in Holder Road, Maidenbower in 2006 before the big crash.  It came up because a neighbouring house has come on the market this week at a price 34% higher than her investment.  In actual pounds - £64,000 higher, not bad considering the value dropped substantially in the years following the purchase.  The recovery has been long and the headline increase is only recent, figures from the internet tools show the value of property in Holder Road has risen by an average of £355 a week but only in the last 12 months. 

As a rental agent I’m interested in the investment potential & whether the property will pay its way.  I checked the records since 2006, 4 tenancies, a rent increase on each and a total void period of 21 days in 8 years.  The rental yield started at 5.4% in 2006 and the current marketed price has dropped the yield to just less than 5% but with a 34% capital appreciation & negligible voids the house is still to be considered as a solid investment.  I am pleased for my landlord, she bought a great house that has always had great tenants and proved to be a great investment.     

Central Crawley Apartment with 6.2% Yield

When the old Crawley swimming pool and sports centre was demolished who knew the area would be transformed into one of Crawley’s most sought after developments for rental property.  I have seen this 2 bedroom apartment come on to the market with Mansell McTaggart at a price that would make it a great investment.

 http://www.rightmove.co.uk/property-for-sale/property-44765996.html#

I believe it is the location of the development that fuels the great demand for these apartments, they are within walking distance of Crawley town centre, Crawley train station and Three Bridges train station with its direct trains to London Victoria & London Bridge.  Not forgetting that underground parking and ensuite bathrooms also score highly on tenants wish lists.

Finding a tenant at the rental value of just under £1000 per month is the easy part, perhaps more difficult is actually purchasing the property at the advertised price of £190,000 to achieve the rental yield of 6.2%.

Will it get harder to find a property deal in Crawley?

Landlords, investors & anyone looking for their next home are always on the lookout for property bargains but will they be harder to find in Crawley.  The recent announcement that £443million is to invested in the Gatwick Diamond area with Crawley at its heart should surely increase the pressure on the housing in the local area. 

Popular investment properties are the 1 bedroom maisonettes in Southbrook, Tollgate Hill, last year they were selling at £125,000 but ten years ago they were being sold at £89,500, that’s a 39% increase in value.  Despite the recession and housing “crash” anyone who had invested in one of these great little properties has seen the value increase by 39% through it all.  Popular with airport staff because of the direct FastWay routes to both terminals the rents have risen by 30% during the same period.

Gatwick currently employs 23,500 staff actually on the airport, who knows what this will climb to if Gatwick gets its wish for the 2nd runway in 2019.  The 3 bedroom family houses in Southgate Drive, Crawley could be bought for £165,000 in 2004 – the latest sale this year was at £227,500 – an increase of 37%.  Based on the past ten years data and looking at the possibilities for the investment in the Crawley area and what could happen with the 2^nd runway at Gatwick it could be that any property deal in the area will turn out to be a good deal.

Investment Opportunity - Tilgate

Yield or capital appreciation – which is better?  Why not go for both.  I have seen this great little maisonette come on to the market with local agent Homes Partnership in the Tilgate area of Crawley.

http://www.rightmove.co.uk/property-for-sale/property-44746693.html

Having checked through the data these properties were being sold for £130,000 in 2006, today’s marketing price represents a 30% increase in capital value.  When they come up for let they have always proved popular, the last one rented at £850 per month which at today’s price is a 6% yield.

Famed for its park, nature centre and lake, the Tilgate area of Crawley is favoured by young families because of the access to schools and the extensive leisure facilities.

House prices on the Langshott estate outperform Horley by 11%

Last week I highlighted a flat for sale in Horley that had a great rental yield and we have looked further into Horley and its property market.  One of the areas that always generates a great deal of interest is Langshott, just to the east of Horley.  Started in the 1980’s it is still being added to today, the newest part, the Acres started to complete this year.  There is a full range of property from detached houses at £475,000 to 2 bedroom apartments under £200,000.   All of these properties are a short walk from the town centre and train station and only minutes from the Fastway bus service with its direct connection to both terminals at Gatwick Airport.

Of the 37 properties for sale today in the Langshott area, 27 of them have a buyer and are sold subject to contract, demonstrating that the chances of finding a buyer are good.  The great news for home owners is that average prices over the last five years have outperformed the local market by 11%.  Average prices on Langshott have risen by 20% whilst the average rise in the more general Horley area has been 18% over the last five years. 

The good news also extends to investors with high demand and high rents resulting in decent yields and minimal void periods.  Not all new-build properties have great yields but this fully appointed brand new 2 bedroom, 2 bathroom house in Coppice Lane was let earlier this year and achieved a good yield of 5.2%. 

Invest in Horley & get a yield of 6.2%....?

Perfect for Gatwick workers this 2 bedroom flat is less than 20 minutes by direct bus from Gatwick Airports North Terminal & has a FastWay bus stop minutes from the front door.  Marketed by Connells it is not only perfect for commuters but investors should sit up & take notice of the 6.2% yield if you can seal the deal at £160,000. 

 http://www.rightmove.co.uk/property-for-sale/property-30585336.html

The No.100 runs from 3.30am to midnight, perfect for getting staff to and from the airport.  Being situated just north of Horley town centre it would also appeal to anyone looking for an easy drive to either Crawley or Redhill.  

 

Studio Flats - Are They Worth Investing In...?

Earlier this year a landlord client of mine sold his studio flat in Broadfield, Crawley, that he purchased in 2009.  After five years the capital growth had not been outstanding, only 4% to be precise.  If he had purchased the flat when it was previously sold in 2003 the capital growth would have been a much more impressive 50%.  But what struck me was the yield, based on the 2009 purchase price the yield was a phenomenal 8%.

 

Studio apartments tend to be the first rung on the property ladder for tenants or a temporary place to stay for visiting workers and experience a higher turnover of tenants than the larger properties.  But with a constant stream of workers coming to Crawley to work at Gatwick Airport the studios are always in demand and this has continuously pushed up the monthly rent.  Amazingly, at the price the flat was sold at the yield is still just under 8% (7.93% if you want the exact figure).

So are studio flats worth investing in?  If the right location & the right price can achieve an 8% yield – yes they are.

Southgate, Crawley - A good place to buy?

I spent a sunny Sunday afternoon in Goffs Park and looking around at the large detached houses I wondered how the market compared with the general Crawley property market.  Southgate could be the leafiest suburb of Crawley and parts of it pre-date much of the new town that has sprung up around it.   The Southgate area has a property for everyone, from an impressive detached house close to the park for £450,000, equally impressive Victorian red brick houses closer to the town centre in the mid £300,000 range.  At the other end of the scale a very reasonably priced terraced house could be purchased for around the £250,000 mark in the area around Southgate Drive & the neighbourhood shopping parade.

Of the 87 properties for sale today in Southgate, 52 of them have a buyer and are sold subject to contract, which shows that if you want to sell, the chances of finding a buyer are good.  What is encouraging for everyone is that sales are evenly spread across the price ranges (from the period properties in Malthouse Road through to the 1970’s flats in the middle of the Southgate West by the Tesco Express).

Taking a general view on the property prices in Southgate I found that average property values in Southgate have risen by 20.87% in the last five years, compared to the Crawley average of only 19.53%.  That means house prices in Southgate have outperformed Crawley as a whole by 7%. 

As a rental agent I know that Southgate properties are always in demand because of their proximity to the town centre and the station but it’s also good to know that I can advise any investor or home buyer that bought in Southgate five years ago that their capital value has outgrown the local average.