Folkestone Buy To Let Property of The Week

£550pcm - £125,000 - Broadmead Road

Update:  We've moved our blog to www.folkestone-estateagent.co.uk




I've chosen this lovely little one bedroom flat on Broadmead Road this week because it's the sort of property which ticks all the boxes for a potential tenant.  

It's ground floor with a lovely little garden, double glazing, gas central heating, good sized rooms and a bit of storage.  Literally around the corner from Folkestone Central Station (0.2 miles according to Rightmove) which takes you to London on the fast train in 54 minutes.

Assuming the property is kept in good condition, all those lovely ticked boxes will help by keeping the rent up, reducing voids, lengthening tenancies and attracting quality tenants.  (found for you by us, of course!)

All this with a potential yield of 5.5%.

Oh, and it's share of freehold...  take a look on Rightmove...


P.S. See update below in comments>>

6.57% Yield Folkestone Buy To Let Property of The Week

Radnor Park Avenue £105,000 and potential of £575pcm

Update:  We've moved our blog to www.folkestone-estateagent.co.uk


What's That? Yield Under 7%?!???!


Before you start throwing rotten veg, take a closer look....



The location and size of this property is amazing, the lease is long, there's off-road parking, double-glazing and just around the corner is Radnor Park and Folkestone Central Station which will get you to London St Pancras in under an hour.



OK, the yield isn't as high as other deals I've written about recently, however the potential for capital gain is there too and that's something that should be factored in here.



Based on the advert I think that the agent's photos seem to be avoiding the radiators which are likely to be storage heaters and there's no photos of the bathroom so either one of the vendors was in there taking a really long bath when they came round to take photos or we should expect an avocado suite or DIY tiling.  <eek>



Take a look at this property on Rightmove and see what you think... http://www.rightmove.co.uk/property-for-sale/property-32448309.html

One Bedroom Apartments in Folkestone – Are They A Good Investment?

Update:  We've moved our blog to www.folkestone-estateagent.co.uk


A potential new landlord popped into our office last month looking for advice about purchasing her first buy to let investment in Folkestone.  She’d seen the recent publicity in the newspapers about Folkestone being an up-and-coming seaside town and the rise of our arts scene fueled by the recent investments made by The Creative Foundation and our new fast train to London.  She was particularly interested in finding a property which had at least a 6% yield but also had the potential for capital gain in the future.  This particular landlord has just exchanged on a property that we found for her, but since then we’ve been instructed on another similar property just like it.

We currently have a one bedroom flat with a private garden on Julian Road

One Bedroom Flat with Garden
Currently Let at £575pcm - £110,000

available for a very reasonable price of £110,000.  The property is being offered as a Buy To Let investment. There is a fully referenced tenant who has just moved in on a 6 month Assured Shorthold Tenancy.  The rental income for this tenancy will be £575 pcm giving a 6.27% yield.  However, you must remember that every landlord’s tax position and interest rates are different, so it is essential to research your investment carefully before committing.

On a personal note, we're really hoping to find an investment landlord for this property since the tenant who has just moved in has had to move three times in the last 18 months due to his landlords selling their properties. Julie, our Sales & Lettings Co-ordinator, says that he's a lovely man who's hoping he won't have to move any time soon!

Finally, let’s not forget about the potential for increase in capital value of the property. I was looking at the history of sales prices for flats and apartments on Julian Road and found that they have increased in value by 15% in the last five years.  With more commuters moving to Folkestone every year, whilst capital gain is never a dead cert, it certainly is building momentum in Folkestone.

If you're interested in Investing in Folkestone, download our Market Analysis of the local market from our not so secret website which includes supply and demand statistics broken down by number of bedrooms and a map showing the fast train railway stations and the most (and least) popular areas.

Are High Yield Properties Too Good To Be True?

Update:  We've moved our blog to www.folkestone-estateagent.co.uk


I'm going to be a bit controversial here, remove my letting agent hat and talk to you as a landlord and a property investor.

I often speak to new and existing landlords who have called the office to ask about a particular property that they've seen for sale online.  I'm always delighted to have these conversations firstly because I'm human and I enjoy sharing my experience and expertise, but also because nine out of ten new landlords aren't yet switched onto this inconvenient truth:

95% of High Yield Properties Don't Deliver on Capital Gain

And that's why I'm so happy to talk to landlords about their potential purchases before they buy them.  For those of you who aren't already nodding your head in agreement, let me explain.


High Yield Properties Tend To Exist on the More Affordable Side Of Town.

Yes, there are exceptions to this rule, but in the majority of cases this is a universal truth.  Taking Folkestone as an example, three bedroom properties are in high demand and low supply in the whole of the rental market, making them an ideal investment opportunity at the right price.  Let's compare two properties, one in the affordable side of town and the other near the fast train to London.

Invicta Road, Folkestone	Limes Road Folkestone
Price: £140,000 (Update: Sold for £138,000*)	Price: £385,000
Expected Rental PCM: £700	Expected Rental PCM: £995-£1100
Estimate Gross Yield: 6% (*6.09%)	Estimate Gross Yield: 3-3.5%

So Invicta Road massively outperforms Limes Road in terms of gross yield, and in fact you could buy two three bedroom houses on Invicta Road for the price of Limes Road and make potentially twice the yield.  Wow!  If you're simply looking for a short term investment which outperforms the bank then Invicta Road is worth a look.

What About Capital Gain Then?

Let's look at two similar properties, of the same size, on the same streets and see how much they've sold for in the last ten years…I know which option I prefer for capital gain.

So there we have it - High Yield and Capital Gain are in most cases mutually exclusive when you go to the extremes.  There is, however a sweet spot in between and other ways to get your capital gain… but that's a story for another day.

If you'd like more information about the Folkestone Rental Market then download our report or give us a call on 01303 212797.