This 3 bed end of terrace house has just come on the market close to the General Hospital at £180k. It will appeal to investors as it is currently let at £895pcm, which equates to £10,740 p.a. and represents a Gross Yield of 6%. Indeed if the property had a spruce up it could let for £950pcm, but is it worth the asking price?
Well the adjacent mid terrace unit sold last November at £153k and a 3 bed semi further up the road sold for £145k earlier this year, of course conditions of properties vary but clearly this one is well above recent sales levels for no apparent reason. In our view a gross yield of 6.5% to 6.75% is appropriate for this type of let which would equate to a capital value of £160k to £165k which seems to be more realistic.
It pays to do your research on potential acquisitions. Currently in Southampton sales agents are having to compete hard for stock and vendor’s expectations can be strong which can result in higher asking prices. But do your homework and if you feel the price is out of line with the market, wait a bit as the price may be reduced as the vendor gets more realistic. If you would like an independent view on any property you are considering buying in Southampton please give me a call and we can chat it through
No comments:
Post a Comment