Our guide to investing in Stoke-on-Trent
Stoke-on-Trent is a popular place for investors due to its high yields and high demand for rental housing from the local population. Housing is very affordable but with low wages, many locals are unable to buy their own home. Many of our landlords are from other counties or abroad.
The first step towards a successful investment is to visit Stoke-on-Trent. Our city consists of 6 towns. The commercial capital is Hanley, currently undergoing regeneration. We have wonderful neighbourhoods and really undesirable ones. Many out-of-town investors buy without visiting and then struggle to rent out their properties. Based on our experience, neighbourhoods like Birches Head, Norton Heights, Sneyd Green and modern developments in Burslem, Tunstall and Hanley are desirable areas. Even in these neighbourhoods, there are some streets that are best avoided.
Things tenants look for here:
- They desperately need 3 and 4 bed houses
- Good decent accommodation
- Close to a good school would be handy
- To be near family
Some local facts:
- Typical gross rental yields 6 - 7% for unfurnished houses. 10 - 12% for houses in multiple occupancies or student lets which are furnished with bills included. However, the market is now inundated with furnished room lets. Our opinion is that the apparent high yields are not so high when void periods are factored in. Rooms are now sitting empty for a few weeks when 5 years ago there were virtually no void periods.
- Capital growth has been slow the last 10 years. House prices doubled from 2000 – 2004 but since the recession hit in early 2008, capital growth has been slow. From October 2016 to July 2017, prices rose by 0.35% only according to the Land Registry data. The heady days of buying, re-mortgaging in 2 years to release equity to buy another house are over. The housing market in Stoke-on-Trent for the next 5 years will likely remain slow on the capital growth front.
- Good rental income can be lost to high repair and maintenance costs that plague the aging housing stock. A high proportion of the housing stock are Victorian terraces built for the potbank workers in the late 1890s. These houses are almost 130 years old. So beware of rising damp, leaking roofs, single glazing, no central heating etc.
If and when you come to visit Stoke-on-Trent, do come to visit us, so we can discuss further. We have pay and display parking outside our office and tea and biscuits inside! Our office is just up from the Potteries Museum, on 8 Albion Street, postcode for satnav ST1 1QH.
We can help you source a property if you’re happy for us to manage the lettings thereafter. Feel free to ask us for our opinion on any particular property you’ve seen on the market.