I
was contacted by a retired couple who were moving to Chichester and wanted some
advice. They were looking to invest in a few rental properties to supplement
their pensions and wondered what I thought they should consider.
They
had been to four local estate agents who each had the perfect property for
them. Yet they were all in a different part of town and in various states of
repair!
So,
what should they buy?
It
depends!
Different
circumstances call for a different approach to property investment:
-
‘Bargains’ can be elusive in and around Chichester as it is an area in high demand.
Modest rental returns (yields average 4.4%) should, however, give way to better
long-term prospects for capital growth.
-
People seeking more rental income may want to look further afield where
property prices are lower. Bear in mind though that these relatively cheaper
areas may require more management, not rent as easily, nor provide such
positive long-term prospects.
-
Newer-build properties will require less maintenance and should attract good
quality tenants. This type of property can give you a quieter life but at a
higher purchase price, which will impact your initial rental yield.
-
‘Doer-uppers’ on the other hand can be great if you have the skills, time and
money to inject new life in to a tired property. Buying the right property at
the right price, with a sensible budget for refurbishment, could maximise your
returns.
The
retired couple had worked hard for the past forty years and now wanted the
quiet life, with a safe investment giving them a reasonable return. They had a
good amount of capital to invest and did not want to undertake a project nor
spend hours chasing after ‘problematic tenants’.
In
this instance I recommended they look at modern houses in and around Chichester,
which should prove to be a good long-term investment. Well-kept properties will
attract good quality, long-term tenants with fewer maintenance issues. They
would be able to move people straight in and start earning a reasonable (4-5%)
return on their money.
Whilst
it may not make them a fortune overnight it is simple and relatively safe,
which is what they wanted. It beats the return from a savings account too!
Consider the following when thinking about buying a rental property:
|
(This article was featured in the Chichester Observer's property section
on 7th January 2016).
Clive Janes, CRJ Lettings.
www.crjlettings.co.uk
___________________________________
If you are looking for an agent that is well-established, professional and communicative in Chichester, then contact us to find out how we can get the best out of your investment property.
E-mail me on clive@crjlettings.co.uk or call 01243 624 599.
Don't forget to visit the links below to view my previous buy-to-let deals and Chichester Property News articles:
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