Little bit late with October’s edition this time! I blame the dog….
Christmas is back again and for another year I will try and do my shopping earlier – never happens but anyway! This month’s property is a high yielding one in an area that gets a bad rap locally. We are at Brand Lane, Stanton Hill, and this property was refurbished from a boarded up state letting at £450pcm within the first two weeks of listing https://www.belvoir.co.uk/properties/for-rent/
There seems to be a £450pcm ceiling for rental prices in the area for properties of a similar age as newer build properties are only letting for £500/£525. The crucial factor in making an investment work here is ensuring you get a good enough discount on the property, or get a property that requires major refurbishment work.
We have found that in the main enquiries have been from the Eastern European community, most likely due to affordable rental prices and the locality to Huthwaite & Sutton-in-Ashfield which provide employment. The other enquiries have been from tenants who are in support of social payments.
This property was purchased 15th April 2014 for £34,000 at auction, the days when you could really pick up a bargain at The Towers! The prices have peaked at £60,000 (noted in 2006) but never crept beyond that value. Most recently, a property a few doors down sold for £58,000 so it is safe to say that the capital appreciation of the area is relatively poor. Comparing this to a gross yield of 16% you can see the earning potential of this property, not to mention the short payback period!
In my opinion, Stanton Hill is an area where you achieve a good return in terms of yield and an investor will need to focus primarily on the earning potential, not the capital appreciation. As it stands there are not many properties for sale in the area, the closest being a property on Co-operative Street on the market for £56,000: http://www.rightmove.co.uk/property-for-sale/property-44756952.html.
This property has been on the market for over a year now and if an appropriate discount is secured, the yield can be further improved, making it a more viable investment option!
You may have to consider the implications of property licensing in this area.
Do you know what your property is worth? Give us a call on 01623 427 777 or email mansfield@belvoir.co.uk!
