Hello again readers!Well, the recent article about Duffield certainly made the phone ring!
The subject of investing in villages for buy to let is an interesting one. In fact it can be as risky as investing in student lettings or HMO’s (Houses of Multiple Occupation where everyone has a bedroom with a shared kitchen and bathroom).
As I keep saying in these articles, investing in the Derby property market is something that shouldn’t been done lightly. For those new to the buy to let investment game, the yield is the yearly rent from a property reflected as a percentage of the value of the property (one might consider it in the same light as the interest rate from your savings account) whilst the 'Capital growth' is the amount the property goes up in value each year reflected as a percentage of the value of the property.
In my rather thought provoking article we said Duffield property values were 9.35% above the 2007 peak of property prices (before average UK property prices slumped 15% in 2008). However, property investment cannot be judged over short time frames and most certainly not by averages.
Often, when looking at a particular property or a number of properties for a landlord, I like to take a longer look at the market, as I consider a period of around 10 to 15 years a more suitable time frame for capital growth. After doing my research, looking at every Duffield property that sold in 1999 (and there were quite a few!) and the very same property selling again 2014, average property values had risen on average by 220.3% in Duffield, whilst in Derby they had only risen by 153.6% That's not to say everything in Duffield turns to gold. One property on Vicarage Lane had impressively risen by 111% since 2001, but not so impressive when you consider average property values in Duffield rose by 175% between 2001 and today. Also, one of those lovely apartments in The Park (on Tamworth Road in Duffield) sold a few months ago for nearly 10% below the price paid in 2008; the year of the slump. So, even in a village environment, it’s important to look at what type and to look at where the properties are that will effect good capital growth.
I pride myself by knowing the market with all its ups and downs, so I can give some great advice and opinion. It might not be what you want to hear but, I can assure you,it is what you need to hear!
As always, as I don’t sell property, if you want a chat about what (or not) to buy in the Derby property market, email me the property link from Rightmove to my email address and I will give you my honest opinion.
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