LETTING & ESTATE AGENT

Should you buy an ex-council property to let out – specifically in the Belfield area?

Should you buy an ex-council property to let out – specifically in the Belfield area?

I had a conversation last week with a friend who lives in Healey and is looking to enter the buy to let property market.  We got talking about property in Rochdale and in particular where good rental yields can be obtained.  When we got talking about the Belfield area, as this is where he grew up in the early 1960’s, prices became interesting. Basic 3 bed semi-detached houses in Belfield can be bought for around £70,000 and they rent for around £475 per month, a yield of 8.8% per year… very reasonable indeed.

However, like I said a few weeks ago, yields are not everything in property investment. Another is how easy it is for a property to let and the times there are void periods. The ex-council houses do tend to have more of those voids. I did some calculations on houses that came up for rent in the Belfield area over the last 24 months and the average void time to find a tenant was 36.3 days. That was nearly 5 weeks without rent. The headline yields don’t include those times. If it did, the yield would be nearer 7.1%, which still isn’t bad, but an important consideration when looking to buy.

If you wanted a safer bet, then a modern 1980’s or 90’s two or three bed semi in Rochdale could be a better investment for you. Yields are around 6% and with capital growth of just over 5% in the last 12 months this may be more suitable…  Nicer properties in more affluent locations don’t have the best yields, but their property values do tend to go up quicker over the long term and have hardly any void periods or ongoing issues, which some high yielding properties can suffer from. The choice, Mr (or Mrs) Landlord, is yours!

Unlike an agent trying to sell you a property, I can look at the whole of the Rochdale property market and give you my advice and opinion to help you find the best investment property. You can be assured of this as it is in our interest that you buy a property which will rent well, and for long periods of time. If you would like any advice on choosing properties, please ring me on 01706 648277 or email on philwatson@martinco.com