A current landlord looking at investing in another buy to let property asked about a property on Rudbeck Avenue. I did some research and uncovered some surprising results. A comparison of annual yield /return on Rudbeck Avenue shows that they are higher than an area such as Marigold Crescent. The average price of a 3 bed property on Rudbeck Avenue is £115,000, whilst on Marigold Crescent it is £147,000. The current rent for a property on Rudbeck Avenue is £525 pcm compared with £595 pcm on Marigold Crescent. This means that buying a property in Rudbeck Avenue would produce an Annual yield/return of 5.4% compared to 4.8% on Marigold Crescent.
This is a great example of annual yield / return not being the only factor to consider when choosing an investment property. How long it takes to find a tenant should be a consideration, it takes an average of 5 weeks to find a tenant for a property in the Rudbeck Avenue area whereas a Marigold Crescent property is usually let in 2 weeks from instruction. Taking into account potentially longer voids periods will affect the overall return.
Also capital growth should be taken into account. Looking back 10 years properties on Rudbeck Avenue have seen a capital growth of 21% and Marigold Crescent have seen a capital growth of 33.6%.
If you would like any advice or opinion on what (or not to buy) then please pop into our office, Belvoir Lettings on Burton Street, Melton Mowbray or call Charlotte or Katie on 01664 569700.