Loughborough - choosing the right property
How straight forward is it?
Recently I was reviewing one of our landlord’s portfolios with him and he asked specifically about two streets in Loughborough; Cambridge Street and King George Road. We discussed specific properties we have managed on those streets and my general feelings about how they perform; I then decided to look more closely at current rents and yields on those streets and their immediate areas.
Currently the average rent on Cambridge Street is £510 pcm and recent sales (last 2 years) have achieved prices averaging £119,000; this gives an average gross yield on the street of 5%. On King George Road the average yield is the same at 5% with rents higher than Cambridge Street at just over £535 pcm but average sale prices in the last 2 years also higher at just over £130,000. On that basis there isn’t much to choose between them and both are very rentable. Houses on Cambridge Street tend to be 2 bedroomed and on King George Road 3 bedroomed (although not exclusively). Cambridge Street houses are older terraces circa turn of the last century and are very close to the town centre and station and on King George Road they are younger houses and are close to the Grammar School and enjoy quicker access out of the town southwards on the A6.
When compared to other properties in the local area we find that LE11 2 postcodes (which includes Cambridge Street) have an average rent of £580 pcm and LE11 1 postcodes (which includes King George Road) have an average rent of just over £510 pcm. This suggests Cambridge Street is punching slightly below its weight and King George Road a little above. However, these postcodes include quite a variety of housing types and must be looked at more closely.
Local knowledge makes a huge difference when you're selecting a property for your portfolio so find someone with the knowledge and ask them. It could make the difference between ending up with a property that has fewer voids and one that stand empty too often; as all investment landlords know, voids kill the bottom line.