Dunstable’s house prices are rising.
There are currently 368 properties for sale in Dunstable and the average asking price is £275,797 which is an increase of 7.49% in the last year. The average price actually paid in the last year was £203,036.
The average asking prices across the property types are as follows:
Detached £396,476
Semi-detached £214,923
Terraced £168,438
Flats/apartments £116,999
With house prices climbing, is buy to let still a good investment?
It’s almost certainly true that Dunstable and Houghton Regis will always have a strong rental market. As well as the proximity to London which attracts renters unable to afford the London rental prices, the local large employers such as Honeytop, Superdrug and WHSmith to name a few employ large numbers of staff. These employees might wish to make Dunstable or Houghton Regis their long term home, but cannot afford to buy.
With Dunstable even beating Aylesbury in house price rises recently you should also see a good gain in capital yield. See our previous article ‘Dunstable v Aylesbury’
However you still need to be prepared and to carry out your research with the help of a Specialist Letting Agent such as Belvoir in Dunstable.
Obtaining a mortgage has seldom been cheaper, but you’ll still need a good deposit. Make sure that you find the right mortgage, as in the medium term the Bank of England has given a strong indication that rates are going up.
Budget properly. There are lots of expenses. Getting a property up to scratch pre-rental, ongoing maintenance, agency and mortgage fees, insurance etc. can all bite into the profit margin.
Plus there’s tax – although you can offset some costs, such as maintenance.
Renting out a home can also be extremely stressful and time consuming. Even with an agent involved, tenants will still disappear, emergency plumbers will still need to be called out. And if the property is empty, the mortgage will still have to be paid, so make sure you have spare cash to cover any tenant-free periods.
Don’t rely on making a capital gain on your investment. Although you may well do just that, solid rental returns should the backbone of your return.
And do your research before you buy. Some areas are easier to rent in than others and offer a better return. What sort of tenants are you trying to attract and what will they pay? Would you let the property to housing benefit tenants in return for a guaranteed rent? Initial purchase price shouldn’t be your only guide.
If you’re managing the property yourself, make sure you have a proper rental agreement in place and that the money comes in on time. If you’re not, be in touch with the agent on a regular basis and check that the money arrives when it’s supposed to.
And finally, be nice to your tenants. If there’s a problem, fix it quickly. They are paying you a rent so they deserve to live in a habitable property. A bad relationship with your tenant is the fastest way to a empty home.
Buy to let can still be good investment in Dunstable, but you need to be absolutely certain you know what you’re doing. Come and talk to the staff at Belvoir Dunstable before you make that purchase and we will help you to choose the right property to maximise your investment.
