Marketing Price - Guide Price £160,000 - £180,000 Cash Buyers only
Expected Rental - £950 - £1500pcm
Rental Yield - Between 7% and 11% depending on letting type
Something a bit different this week, a cash buyers only tower. But why? Read on ..
If you are looking for a good investment property in the local area, looking for the "norm" is fine, but you will come across considerable competition from other investors, as well as the regular first-time buyer. That means getting a great deal is unlikely.
Looking for something "outside the box" makes more sense, where you can add value, or maybe chip away at the asking price a little.
Step forward any property being advertised as "Cash Buyers Only".
But why?
Supply and demand, simple. With the removal of the all regular mortgage buyers, the amount of people interested in any cash only property will inevitably be smaller, and that potentially gives you more room to negotiate, and the vendor less alternative options when you place your offer forward.
In this example we have Shenfield House, SE18 by the Queen Elizabeth Hospital ....
Perhaps not the prettiest thing you've ever seen, but at a Guide Price of £160,000 - £180,000 numbers wise its as attractive as they come.
A regular rental would achieve a rent of around £950pcm. This is a 7.1% rental return at the lower end of the guide price quoted. Not too bad.
Bearing in mind you neighbour the hospital, with shift workers, and maybe some lower end income hospital employees or student/doctors/nurses, and looking more closely at the floor plan, you'll note that a room let arrangement wouldn't be beyond the possibilities.
It's fair to assume that people living in tower blocks often don't have the higher expectations of many others, and the option to house three tenants across the three double rooms, at circa £500 per room per month offers affordable housing to low income tenants, and a fantastic £1500pcm income ... £18,000pa!!
A return of nearer 10-11%. Well worth considering.
Perhaps this one isn't quite right for you, but if you want help in finding one that is, or have a rental investment elsewhere you would like a second opinion on, please do not hesitate to get in touch directly at kevin@dansonpropertyservices.com
