BUY-TO-LET DEAL OF THE WEEK: 4 bed house in Chichester, £525,000, 6.0% yield

Summary:
4 bed house in Chichester
Listed for sale on 11/08/20 @ £525,000
Rent = £2,625pcm
Yield = 6.0%

Having written about buying a developer's show home, I thought I'd bring a real-life example to this week's buy-to-let deal of the week.

The Shopwyke Lakes developer Cala Homes have a couple of show homes for sale on the development, including this four-bedroom semi-detached house priced at £525,000. They offer a 6% rental return for at least 18 months. As per the main article though, there are a couple of points to note:

Is the price fair?

The show home is for sale at £525,000 (https://www.rightmove.co.uk/new-homes-for-sale/property-95977706.html), whilst the identical neighbouring property is available for £499,950 (https://www.rightmove.co.uk/new-homes-for-sale/property-95675906.html). This suggests you may be paying £25,000 extra for the show home, depending on the level of fixtures and fittings i.e. perhaps they aren't exactly like-for-like? If you take that sum off the rent you'll receive over the 18 month period, the return would drop to just 2.8%pa.

What about at the end of the leaseback period?

The minimum period is 18 months, although my experience from show homes is they're always needed a little longer than anticipated. As such, for as long as it remains the show home you do get a fantastic monthly rent (of £2,625pcm based on a 6% return from the £525,000 asking price). When the developers leave though, you'll either want to sell the property or re-let it to 'normal' tenants. In the current market I'd expect you to do so for around £1,600pcm, meaning a rather less headline-grabbing rental yield of 3.7%.

The property is on the market with Cala Homes and full details can be found on Rightmove via the following link: 

https://www.rightmove.co.uk/property-for-sale/property-95977706.html

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   crjlettings.co.uk   clive@crjlettings.co.uk  01243 624 599

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BUY-TO-LET DEAL OF THE WEEK: 4 bed house in Chichester, £325,000, 4.8% yield

 

Summary:
4 bed house in Chichester
Listed for sale on 19/06/20 @ £375,000
Now = £325,000
Rent = £1,300pcm
Yield = 4.8%

This large four-bedroom townhouse is located close to St Richard's Hospital in Chichester, which will always mean there's a steady stream of tenants wanting to rent the property due to its location.

Whilst many of the townhouses in this area are let to students or sharers, simply letting it to a single household will achieve a decent 4.8% return based on a rent of £1,300pcm and an asking price of £325,000. Bear in mind too that asking price has been reduced by £50,000 since being listed just a couple of months ago for £375,000!

The house is around 10 years old so has modern fixtures and fittings as well as the (now almost obligatory) gas central heating and double glazing. It has also been re-decorated recently according to the advert, so there should be little work required to get it ready to rent.

One thing the advert lacks is a floorplan, which is to the detriment of the seller as perhaps the biggest selling point to the home is its size and, most notably, it having four double bedrooms. In fact, the house is something of a tardis as it looks quite narrow from the outside. It also has a garage, which is always a good extra to have on a large family home. Add all this to its location and it would make a good buy-to-let investment at what appears to be a reasonable price.

The property is on the market with King & Chasemore and full details can be found on Rightmove via the following link: 

https://www.rightmove.co.uk/property-for-sale/property-71299773.html

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   crjlettings.co.uk   clive@crjlettings.co.uk  01243 624 599

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BUY-TO-LET DEAL OF THE WEEK: 4 bed house in Chichester, £450,000, 4.3% yield

Summary:

4 bed house in Chichester
Listed for sale on 29/05/20 @ £485,000
Now = £450,000
Rent = £1,600pcm
Yield = 4.3%

To coincide with writing about the stamp duty relief up to £500,000 that now exists, I thought I'd pick a buy-to-let property that maximises that saving. I found a new-build property on Graylingwell Park at £490,000 (close enough right?) but then noticed an identical house (albeit a couple of years old now) up for sale for £450,000. A £40,000 saving for having had someone else work through the snagging - sounds like a deal to me!

At over 1,600 square feet I believe it is one of the largest houses on Graylingwell Park. It also means on a '£ per square foot basis' it compares well to other properties on the estate and in Chichester. Having been reduced to £450,000 from £485,000 when first listed in May, it means it now costs around £280 per square foot. Three-bedroom houses on Lloyd Road in Graylingwell Park are around 1,000 square feet and £330,000, equating to £330 per square foot, whilst the average value in Chichester is around £340 per square foot.

You often find good value like this on townhouses such as this property i.e. ones set over three floors. The house provides four generous double bedrooms, a large living space and a  kitchen/diner. Bear in mind as well that published square footage doesn't include the integral garage and large balcony! Even the garden (which is South-facing) is a reasonable size compared to others on the estate.

The above goes to show that what may seem relatively expensive at first glance compared to nearby properties actually isn't when you delve a little deeper. Unfortunately, it can take the market a little while to work this out, which will have a similar impact on the rental value. £1,600pcm seems relatively conservative for such a large property in great condition and in a nice part of Chichester. But that is reflective of prospective tenants just seeing it as a '4 bed end-of-terrace'. Even so, a 4.3% rental return based on that figure isn't bad in the wider context of buying a property significantly below it's new-build equivalent, which should do well from a capital growth standpoint as people catch on to its positives in the future.

The property is on the market with White & Brooks and full details can be found on Rightmove via the following link: 

https://www.rightmove.co.uk/property-for-sale/property-80279479.html

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   crjlettings.co.uk   clive@crjlettings.co.uk  01243 624 599

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BUY-TO-LET DEAL OF THE WEEK: 4 bed house in Chichester, £325,000, 4.8% yield

Summary:

4 bed house in Chichester

Listed for sale on 20/07/20 @ £325,000

Rent = £1,300pcm

Yield = 4.8%

This four-bedroom house near St Richard's Hospital in Chichester comes with bold marketing from the agent; calling it a 'bargain'. At £325,000 I'm not sure it's exactly that, but it's certainly decent value compared to other nearby properties.

That's especially true when you consider it is a good-sized house (spread over three floors) on a good-sized plot (considering it is relatively new, having been built circa 2007). It has a garage and driveway (which could take two cars if you, perhaps controversially, were to remove the tree out front) and well-proportioned rooms. 

It is in good condition, with neutral decor throughout and modern bathrooms and kitchen, meaning there would be virtually nothing to do before marketing the property for tenants. Whilst many of these houses have been let to students (which has had an effect on the street as a whole), it would suit a family. It should achieve £1,300pcm due its size, location and condition, which would be a useful 4.8% rental return from this relatively modern freehold property. 

The property is on the market with Zone and full details can be found on Rightmove via the following link: 
https://www.rightmove.co.uk/property-for-sale/property-66547257.html

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   crjlettings.co.uk   clive@crjlettings.co.uk  01243 624 599

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BUY-TO-LET DEAL OF THE WEEK: 4 bed house in Tangmere, £325,000, 4.8% yield

Summary: 4 bed house in Tangmere Listed for sale on 10/02/20 @ £350,000 Now = £325,000 Rent = £1,300pcm Yield = 4.8% Last sold for £334,995 in April 2018 (-3% in 2 years) The weekly buy-to-let deal is back! It seemed sensible to stop promoting the idea that people should be viewing and buying properties during lockdown, but as the property market seems fully open for business now, it seems reasonable to trawl through Rightmove and start recommending a few of the best buys out there. Whilst noone is sure what will happen to 'house prices' as a whole, there will still be people wanting to buy and invest in property. Hopefully I can continue to steer those people towards a few of the gems amongst the crowd of listings and away from any potential lemons... This four-bedroom townhouse in Tangmere wraps up pretty much all my top tips and recommendations when buying a buy-to-let into one property! It's a freehold house in Tangmere, which is a growing 'village' and in my opinion well-positioned to appreciate in value over the long-term. The house itself is large, with over 1,100 square feet of space, as well as a driveway and garage. That makes it adaptable and suitable for a variety of tenants, whilst offering excellent value for money on a 'pound per square foot' basis. Talking of value for money; it was originally listed in February at £350,000 and was reduced just before lockdown to £325,000. That offers excellent value for money, but also suggests a few months on that there could be some room for manoeuvre in regards to price. Bear in mind the current owners bought it for £334,995 in 2018 when it was brand new and it means you can buy it for less than they paid two years ago! That also neatly brings me on to my final point, which is the fact the house is 'new-ish'. This is something of a sweet spot in my mind in that you aren't paying the original developers new-build premium, have had time for the property and estate to establish, whilst the house remains in great condition with all the mod-cons today's tenants often expect. The property is on the market with White & Brooks and full details can be found on Rightmove via the following link:  https://www.rightmove.co.uk/property-for-sale/property-77352301.html

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: Follow The Buy-To-Let Property Investment Market in Chichester Chichester Property Market LinkedIn Page for Clive Janes CRJ Letting Agents Chichester Facebook Page CRJ Letting Agents Chichester Twitter Page Chichester Investment Property Management Specialist CRJ Letting Agents Website c/o CRJ Lettings, 30B Southgate, Chichester, West Sussex, PO19 1DP

BUY-TO-LET DEAL OF THE WEEK: 4 bed house in Tangmere, £350,000, 4.5% yield

Summary: 4 bed house in Tangmere Listed for sale on 10/02/20 @ £350,000 Rent = £1,300pcm Yield = 4.5% This is a great-sized four-bedroom house in Tangmere. Being semi-detached and spread over three floors means you get a lot of square footage (around 1,100) for the money - it comes with an asking price of £350,000. It is relatively new and has been kept in great condition. This means there should be virtually nothing necessary to get it 'ready to rent'. It will also appeal to well-heeled tenants, who typically like living in such modern properties. Having said that, one thing that does irk me with this property, and is common in many new-builds, is the lack of tiling and a full height shower over the bath. The developer's logic here is simple - there's a shower in the en-suite, so we'll save money in not putting one in the main bathroom. But in a house such as this that would mean three bedrooms on the middle floor coping without a shower or, more likely seeing as most people shower rather than bath nowadays, queuing to use the sole shower in the master bedroom upstairs. Regardless of that detail, which isn't insurmountable, It should rent for around £1,300pcm. This would equate to a 4.5% rental yield based on that full asking price. That's a decent return for a freehold property in this area, particularly when you consider the age and condition of the house. The property is on the market with White & Brooks and full details can be found on Rightmove via the following link: https://www.rightmove.co.uk/property-for-sale/property-77352301.html

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: Follow The Buy-To-Let Property Investment Market in Chichester Chichester Property Market LinkedIn Page for Clive Janes CRJ Letting Agents Chichester Facebook Page CRJ Letting Agents Chichester Twitter Page Chichester Investment Property Management Specialist CRJ Letting Agents Website c/o CRJ Lettings, 30B Southgate, Chichester, West Sussex, PO19 1DP