Property Rental returns on The Chantry housing Estate in Ipswich outperforms the Marina Waterfront.
We all know Ipswich’s Marina Waterfront apartments are one of the sought after places to live in Ipswich, with even our Ipswich Star reporting that buyers from as far as Hong Kong were snapping them up. The average 2 bed apartment here sells at around £150,000 and £170,000 with some of the top of the range penthouse apartments selling in the region of £350,000 with rents for an average 2 bed at £600 rising to £1000+ per month for the penthouse ones.
I was talking to a couple a few weeks ago, who live in the Westerfield Road area of Ipswich. They were looking to buy their first buy to let property and heard from a friend that I give my thoughts and opinions on where (or not) to buy for buy to let. He wanted to know which area of Ipswich would make a better buy to let investment.
Some landlords believe buy to let is all about the yield (or yearly return) the property gives. It became interesting when we compared the possible annual yields. In Marina Waterfront area, especially such developments as the Regatta Quay and Neptune Marina, annual yields currently being achieved would range from 3.4% pa on the larger apartments to nearer 4.5% pa on the smaller 2 bed’s. However, yields can be as much as 50% more on the Chantry Estate where an average 3 bed house can be purchased for around £125,000 and rents out at around £600 to £650 per month, giving an average yield of 6%. So surely the Chantry is the place to buy, as it has much higher yields?
However, we must remember that yield is not the sole consideration when investing in buy to let property. The average value of the larger apartments in the Marina, has risen on average by 81% in the past 12 years, whilst property on The Chantry Estate has only risen by an average of 56% in the same period.
Ultimately, we found there’s a general rule that the better the area you buy in, the lower the return you’ll get. This is because you’ll have to pay more to buy property in a nice area, and the amount of rent you’ll get doesn’t rise at the same level. However, it is easier to judge yields today than deciding what will go up in value in the future. Buying in a less plush area, such as The Chantry doesn’t mean a property won’t rent, but it does have a bearing on the type of tenant you are likely to attract.
After the property, the next most important decision you will have to make to ensure you get the most out of your investment is which letting agent to choose. At Martin & Co, our time-tested systems achieve exceptional results. With almost 200 offices in our network, over 4,000 'To Let' and 'For Sale' boards on display at any time, 40,000 enquiries for sales and lettings across the network in a typical month, and a property let or sold every 7 minutes during work hours, we really are champions in our field!
Since becoming a public limited company in December 2013, we have noticed an increased feeling of trust in our services, having gained more business exposure and extra credibility from the number of city investors who have chosen to invest in us. Our increased brand awareness has successfully driven more visitors to our site, including tenants searching for their next property.
For landlords looking for comprehensive property management and award-winning customer service, look no further than Martin & Co. Contact Managing Director, Gary Everett on 01473 289794 for free rental advice in your area.