A landlord of mine recently bought a rental property with a slight difference. Whilst they wanted to let it for the moment the long-term intention was for it to be their retirement home.
They had always liked Broughty Ferry, small village atmosphere, waterfront location, all the amenities you would want but only a short hop to Dundee or onwards to Edinburgh etc.
Now I know that in this country a lot of people regard single storey houses (or bungalows as we call them) as only suitable for old people but is that fair. I know I rented one for while when I left the Army and liked it.
So I thought I would have a look and see what kind of bungalows where available in the Broughty Ferry area.
Now when I had a look there wasn’t a vast number available but I did find this example of a 2 Bed Bungalow for Sale..
A nice little two bed in good condition, its on with my colleagues at Thorntons and the asking price is £180,000, I think it would probably rent for somewhere round the £660 to maybe £700 ball park so that’s a yield at the bottom end of just over 4%.
This does kind of highlight one of the issues with bungalows from a purely buy to let perspective, in my experience they don’t generate a great yield, partly because I think their asking price is generally higher than the size of the accommodation might indicate, therefore the rent is lower when compared to a “normal” house.
That said its still better than the bank will offer you and the capital appreciation in Broughty Ferry for good quality properties is pretty consistent, as is the rental demand.
There is also one other factor to consider which can be a complete game changer. I have another landlord who has a bungalow not dissimilar to this one and in roughly the same area. We rented it out for some time, then the landlord came over all creative and extended the accommodation in to the attic, creating a large master bedroom with en-suite and study area. It added about 30% to the rental the property achieves.
All I’m really saying is don’t take things at face value, not all properties can be ‘value add’ and not everyone wants to get involved in projects, but have a good look and think outside the box.
If you have any questions about any of the above or wish to discuss anything else please just email me at nick.horan@belvoirlettings.com
