Great Investment ... 5.9% Yield

Palmer and Partners have this 2 bedroom first floor apartment for sale situated North of Colchester Town. This property would let easily due to its close proximity to the A12 as well as Colchester General Hospital and Colchester Business park. 

With the potential to achieve a rental of £650pcm and if purchased at the asking price of £132,000 this would provide a return of 5.9% per year. 

I think this will generate a lot of interest with investors. 

http://www.rightmove.co.uk/property-for-sale/property-34490205.html?premiumA=true

Great Investment ... 5.65% Yield!

Elms Price & Co have this attractive 2 bedroom apartment for sale situated in the popular area of the Hythe. Within close proximity to Shops and the university this would make a great investment. Boasting a large balcony, use of a private gymnasium and secure underground parking this would appeal to lots of people looking for a rental property.

This could easily achieve a rental of £650pcm and if purchased at asking price of £137,995 this would provide a return of 5.65%. I think this property will be very popular with investors.

http://www.rightmove.co.uk/property-for-sale/property-50137075.html

Fantastic Investment 5.80% Yield!

William H Brown have this stunning 2 bed top floor apartment for sale, at asking price of £149,995 this would make a perfect investment property offering a great return. Situated in the sought after location of Shrub end road and boasting an en-suite to the master, allocated parking and a large lounge dining area this would make a very attractive property for anybody looking for a rental.

This property would easily achieve a rental of £725pcm, if purchased at asking price this would achieve a return of 5.80%. 

This is an investment not to be missed and I think it will be very popular. 

http://www.rightmove.co.uk/property-for-sale/property-52434167.html

What will General Election result do to the Colchester Property Market?

After the shock of the Conservatives returning to power with a majority at Westminster, all the potential issues and possible uncertainties of a hung parliament has lifted the cloud from the Colchester property market.  Talking to other Colchester agents, surveyors and solicitors in the area over the last few days, there are signs this has started a new impetus in the Colchester property market after a subdued six months, when an amalgamation of tougher lending conditions, a natural correction after the strong recovery in Colchester property prices in 2014, and political uncertainty ahead of the General Election slowed demand.

Against the back drop of Labour’s election promises of rent controls and three year tenancies, some Colchester buy to let landlords were waiting to see how these new policies would be implemented before they committed themselves to buying more property for their buy to let portfolio. Now that uncertainty has been removed, the long term picture is very positive.

So, with all that uncertainty now removed, where next for the Colchester property market?  Well with inflation at zero and with the Money markets happy David Cameron is still at No.10, the Bank of England have no reason to raise interest rates until 2016 at the earliest. As mortgage rates are at their lowest levels since 2010, landlords with large deposits will now be wooed by the mortgage companies in the coming months with low rates.

You see over the past couple of years, Colchester landlords have benefited from a booming Colchester job market. Unemployment in Colchester has dropped to 1.9%, as a year ago,1,829 people were claiming unemployment benefit compared to today’s 1,138. With more jobs and better pay, as the level of rents is directly linked to tenant’s wages, there has been an increase in the rental prices tenants are willing to pay for good quality Colchester properties.

Some landlords might be nervous about Tory’s plans for the housing market over the next five years in terms of tenant demand for their rental properties. One plan is for Housing Association tenants to have the right to buy their property. These kinds of tenants were never in the private rented sector and will actually increase the supply of properties in the housing stock in decades to come. The Government ‘Help to Buy Scheme’ has only helped to buy 329 Colchester properties since April 2013. Considering 3,787 properties have changed hands in the last year alone in Colchester, I don’t think it has made a huge difference to our local property market.

The biggest matter, when it comes to tenant demand of rental property going forward, comes from the shift in the mindset and attitudes towards renting itself. Twenty years ago you were seen as a second class citizen if you rented a property. In Colchester, as in the rest of the UK (apart from Central London), renting continues to offer good value for money for tenants.  If you are an existing landlord in Colchester or thinking of becoming one (or as we like to call you .. a FTL .. a ‘first time landlord’), then I must suggest you seek out specialist advice and opinion. Like many agents in Colchester, we will happily give you our opinion on the current state of the market and the advantages/disadvantages to investing in the Colchester property market if you pop into our offices.
 

Great Investment... 5.95% Yield

Michael's have this brilliant one bedroom apartment to offer which would make an ideal investment.. Within walking distance to the town centre and town station this would let very quickly. Boasting off road parking and a small garden area this would let for £595pcm, achieving a return of 5.95%.

I think this is a great return and will be very popular with investors.

http://www.rightmove.co.uk/property-for-sale/property-34577058.html

Crisis in Colchester Property Market?

Since the 1960’s more people have owned their own home than rented but, for many young Colchester people, the dream of buying their own home is dying...or is it? Since the turn of the Millennium, in Colchester (as in the rest of the Country) there has been a significant change in the proportion of people who own their own home in Colchester. In 2001, 71.78% of homes in Colchester were owner occupied, today the figure is 66.31%, a significant decline in such a short time.  Buy to let landlords can find tenants because young people say they cannot afford a deposit to buy unless they inherit money or are given a loan from the Bank of Mum and Dad.

In Colchester, only 39.99% of 25 to 34 year olds have a mortgage. When you compare Colchester against the national average of 35.93%, it just shows how different parts of the country have different housing markets. However, the really interesting fact is this  ...Roll the clock back to 1991 and nationally, 67% of 25 to 34 year olds had a mortgage. After WW2, the supply of properties being built kept up with demand as millions of council homes were built (the most being built in 1950s, surprisingly under Tory Governments!). Also private house building increased in the 1950’s, but especially in the 1960’s and 1970’s, and as the Country  got more prosperous it meant that by 1971, there were more home owners than renters.

However, since the 1970’s, the population has grown but the number of new properties being built hasn’t kept up at the same rate, the result is that there have been huge rises of property prices in the early ‘70s, the late 80s and more recently between 1999 and 2004. Interestingly, since the early 1970’s, out of the 34 richest countries in the world, the UK has seen highest property prices rises.

95% mortgages have been available to first time buyers since late 2009, but with property prices rising by 225.6% since the early spring of 1995 in Colchester, as property prices have been rising and first time buyers have been saving, the amount they have to save is continually rising at the same time. The stress on saving even for that kind of deposit, coupled with the new stricter mortgage rules introduced in 2014, means that most 20/30 something’s in Colchester are renting instead of buying.

The issue quite simply comes back down to a lack of new homes being built. In Colchester, only 792 properties a year are being built whilst the population is rising by 1,716 a year. The supply of new homes has been limited by planning laws, local councils not having the money to build council houses, hard hitting green belt limitations, and our old friend Nimbyism.  With a rising population and net migration, especially from the EU, the mismatch between demand and supply is why we have the problem. Until Politian’s have the backbone to realise the Country needs a lot more decent homes built, the problem will just get worse.

In the meantime, demand for rental property will continue to grow because people need a roof over their head at the end of the day ......fact.

Great Investment... 5.56% Yield

William H Brown have this well presented 2 bed property up for sale in the sought after Location of Axial Drive. North of Colchester and within walking distance to the mainline Colchester train station this would be a very appealing property to rent. 

With 2 double bedrooms, parking and an ensuite to the master bedroom this would easily let for £695pcm. If purchased at asking price of £150,000 the would achieve a yield of 5.56%. 

I think this will generate a lot of interest with investors, 

http://www.rightmove.co.uk/property-for-sale/property-52294064.html?premiumA=true

Great investment 6.21% yield

This attractive 2 bed apartment for sale with David Martin Group would be an ideal investment. Situated on Brook street this is within close proximity to town centre. With parking and a balcony as an added bonus this would easily let at £595pcm. 

If purchased at the asking price of £115,000 the this would provide a return of 6.21%. 

This investment is one not to be missed!

http://www.rightmove.co.uk/property-for-sale/property-48766816.html

Great Investment....5.79% Yield

Beresfords have this 2 bed apartment to offer located on the sought after Braiswick Park north of Colchester. Within close proximity to the Colchester mainline train station this is an ideal property for commuters, making it a brilliant investment.  

If purchased for asking price at £139,995 and let for £675pcm this apartment on Propelair Way would provide a return of 5.79%. With a great return this would make worth while long term investment.

I think this apartment will generate a lot of interest with investors!

http://www.rightmove.co.uk/property-for-sale/property-52172894.html

838% Return for Colchester Buy To Let landlords since 2001

Buy to let is essentially different from investing in stocks and shares or putting money in the Building Society. Whilst these other investments (Building Society Passbooks, Stocks and Shares etc) are passive  ie once the  money has been invested it you leave it alone, with buy to let, things are more hands on, in fact it’s almost a business. One thing the landlords I speak to say is the fact that they like buy to let because it is both an investment as well as a business. It is this factor that attracts many of my Colchester landlords – they are making their own decisions rather than entrusting them to others (such as City Whiz Kidzs in London playing roulette with their Pension Pot).

So if you are investing in the Colchester property market, you can earn from your investment in two ways. When a property increases in value over time, it is known as 'capital growth'. Capital growth, also known as capital appreciation, this has been strong in recent times in Colchester, but the value of property does go up as well as down just like shares do but the initial purchase price rarely decreases.  Rental income is what the tenant pays you - hopefully this will grow over time. If you divide the annual rent into the value (or purchase price) of the property, this is your yield, or annual return.

I was talking to a landlord who bought a terraced house in the Harwich Road area of Colchester. He bought a very pleasant 1 bed terraced house in 2001 for £42,000. It sold again in February just gone for £130,000, a rise of 209.52% in just under 14 years – a compound annual return of 8.41%.

However, the real returns are for those Colchester landlords who borrowed money to purchase their buy to let property. They have made significantly higher returns than those who paid 100% cash. If the landlord had borrowed 75% of the £42,000 purchase price of the Harwich Road terraced house on an interest only 75% mortgage, he would have only needed to invest £10,500 (as his 25% deposit... borrowing the remaining £31,500), but his £10,500 would be worth today, £98,500  (£130,000 less £31,500 interest only mortgage)... a rise of 838.09% -  a compound annual return of 17.34%... and I haven’t even mentioned the rent he would have received in those 14 years!

This demonstrates how the Colchester buy to let market has not only provided very strong returns for average investors since 2001 but how it has permitted a group of motivated buy to let Colchester landlords to become particularly wealthy. In fact, if this landlord had continued to remortgage the property as it went up in value, he could by our reckoning have had an additional two or three properties (albeit with larger mortgages but greater future potential).

As my article mentioned a few weeks ago, more and more Colchester people may be giving up on owning their own home and are instead accepting long term renting whilst buy to let lending continues to grow from strength to strength. If you want to know what (and would not) make a decent property to buy in Colchester for buy to let, then one place for such information would be the Colchester Property Blog.

Fantastic Investment opportunity in Town Centre...5.61% yield!

Henleys Estate Agent have this stunning 2 bed house for sale on Northgate street. This property would be a great investment property reaching a rental of £725pcm. 

If you purchased this property at £155,000 it would produce a 5.61% yield. 

This is a great return and due to the location and how well maintained the property is you would have no trouble in renting it out making it a perfect long term investment. 

I think this house will generate a lot of interest with investors!

http://www.rightmove.co.uk/property-for-sale/property-52065161.html?premiumA=true

Are Attitudes to Home Ownership changing in Colchester?

Speaking to a Bank Manager the other day in Colchester, we got talking about the state of the Colchester property market and whether we, as a Country, are turning more and more to the European style of property ownership, where it is the norm to rent as a opposed to automatically buying once you have a good job etc.

Even though a recent report by the Halifax stated homeownership remains a goal for 85% of twenty to forty five year olds, there is information emerging that attitudes in the UK towards renting your own home as opposed to owning it have softened, showing more and more, that renting is being seen as a life style choice.  In fact it is recognised in learned circles that the cycle of renting is also repeated by the fact that people who grow up primarily in rented accommodation are themselves more likely to rent than buy.

The biggest barrier often mentioned to buying a house is the claim that they are not buying property at the moment because of a lack of sufficient wages and by the high level of deposits but like we said a few weeks ago, in Colchester, if a couple, one  on the average Colchester salary of £25,832 pa and the other on the Minimum wage, assuming they had a reasonable credit history they would be showered with lenders offering them a 95% mortgage (a reasonable credit history means they haven’t defaulted on loans, paid all their bills on time nor got any County Court Judgements. Just because you missed just one credit card payment won’t mean you have messed up your credit score and your ability to get a mortgage) and they would only need to find £7,500 as a deposit to buy a top of the range (and I mean top of the range) apartment in one of the up market developments in Colchester or a good honest 3 bed terraced house in a decent part of the town. It comes down to the perceived capability of the youngsters in Colchester to buy nowadays.

Interestingly, when I looked at the Colchester figures, the average Colchester tenant has a younger profile (especially the sub 24 year olds) than the English and Welsh average, as can be seen from the graph below. What interested me as well was the relatively large number of people renting between the age of 50 and 64. I know we have a large number of mature tenants at our agency, but I always thought that was the exception to the rule. Obviously not!  (And that is good news for landlords as they make excellent tenants)

So what does all this mean for Colchester landlords and future Colchester landlords? I honestly believe there is a difference between the hope and perceived capability of the younger generation to buy a home. Although homeownership is seen as advantageous by a majority, many tenants admitted in the Halifax report they are not taking the steps they need to purchase their own home.

As the local authority aren’t building any properties in Colchester, people still need a roof over the head, and that is why, as I mentioned a few weeks ago in the Colchester Property Blog, the demand for rental properties will only continue to steadily rise in the coming decade.

Great investment ... 7.2% yield!

Hardings Estate Agent have this brilliant 2 bed apartment to offer in Albany Gardens which is South East of Colchester. Within close proximity to the university this would be a great investment easily obtaining a rental on £750pcm. 

If you bought it for £125,000 it would offer an impressive yield of 7.2% per year!

This is a fantastic return and a good long term investment.

I think this apartment will generate a lot of interest with investors!

http://www.rightmove.co.uk/property-for-sale/property-48799124.html