Which town has performed the best?
When purchasing a buy to let property, there are two ways landlords make money through property letting. Capital growth and rental income growth.
A landlord from Mickleham, who has a number of properties in both Leatherhead and Dorking, asked me a few weeks ago about the difference between the Dorking and Leatherhead housing markets. He was focused on capital growth but also wanted to ensure his yield was relatively fair. I was quite surprised with my findings and wanted to share them with you.
The average property price in Dorking is currently £462,614. In the last 6 months property values in Dorking, according to my calculations, have dropped by 3.99%.
Whilst in Leatherhead average property prices are £664,240 having dropped by 0.28% in the last 6 months. Therefore, is Leatherhead the better bet?
Well, not necessarily.
Over the last 5 years, property values in Leatherhead have risen by 20.43% and in Dorking by 23.2%, meaning over the last 5 years, property values have increased at a 13% quicker rate in Dorking compared to Leatherheads.
Each Dorking (and Leatherheads) landlord will have different needs and requirements in his or her property investment. Knowing what has happened to values in different towns, enables us to spot any trends or opportunities for buy to let landlords. If you want an unbiased opinion on what does and doesn’t make a good property investment then feel free to give me a call.
It’s time to invest your cash in a rental property. Whether it's your first dabble as a landlord or you have an expanding property portfolio, there are always some key questions to ask the estate agent.By law, an estate agent must tell the truth and you need to know what you are buying – after all you want to make money not spend it on a load of nasty surprises.
So first things first, ask the obvious – is there anything you should know? Are there noisy neighbours or is a big road planned to run by the back garden? Check exactly what is included in the sale – will you have to immediately rush to Ikea for new light fittings and white goods?
Has the house been for sale for ages? You could get a lower price – which means more profit.
What about major works? Has the house been extended or had attic conversions and have they got the permissions for these?
You will also need to check for any major repairs, you do not want to have to rebuild the gable wall due to subsidence.
Linked to this ask about the boiler, electrical systems and plumbing and drains – all big ticket items if you need to replace them.
For older properties – is it listed or in a conservation area? Your potential for development could be severely restricted.
And what about council tax bands – a key part of any tenant's outgoings so is it right for your market?Finally ask about the general area – is it good for schools and transport? These can be key selling features for the right renters.