Sell as an investment property?

by Readers Question

11:43 AM, 26th August 2014
About 4 years ago

Sell as an investment property?

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Sell as an investment property?

We have numerous properties that we successfully rent, and have done this for many years, but one of the properties, which was for many years our family home, has a mortgage which has only a few years remaining. It is a beautiful detached chalet bungalow, 4/5 bedrooms, 2 bathrooms, set in a beautiful cobbled village backing onto a linear park. It has a secluded garden, west facing mainly decked. Sell as an investment property

It is currently let for £1,400 pcm until next year on a long term let, and it is currently valued at around £470,000.

My question is whether we could sell this as an investment property, does anyone have any experience of doing this?

Any help or advice would be welcome, and I thank you all in advance for this.

Regards

Alan



Comments

Mark Alexander

11:48 AM, 26th August 2014
About 4 years ago

Hi Alan

From what you have said I suspect your property will appeal to far more owner occupier buyers that it will to investors. This is because your gross rental yield is only 3.57% and a property of this nature will require more than average levels of ongoing maintenance which will eat further into an investors profits.
.

Alan Loughlin

11:54 AM, 26th August 2014
About 4 years ago

thanks, fortunately we do get a good inome from it, even after allowing for 10% r and r, which we have not spent to date, we net 50% of the gross rent.

Mark Alexander

11:59 AM, 26th August 2014
About 4 years ago

Reply to the comment left by "Alan Loughlin" at "26/08/2014 - 11:54":

Hi Alan

Is that before or after mortgage?

Either way, £700 net based on a £470,000 investment = 1.79% return before tax.

There will be far more potential owner occupiers than investors looking for a property of this type.
.

Alan Loughlin

12:00 PM, 26th August 2014
About 4 years ago

the 700 is after all costs and 10% put by for r&r

Alan Loughlin

12:01 PM, 26th August 2014
About 4 years ago

the reason for renting was to wait for a rise in value, in the last 6 months, according to Zoopla, it has risen 25,000

Mark Alexander

12:06 PM, 26th August 2014
About 4 years ago

Reply to the comment left by "Alan Loughlin" at "26/08/2014 - 12:01":

Hi Aloan

That makes sense from your perspective but won't to another investor.

Investors will be looking for capital growth but they are more likely to be searching for properties which provide a better pound for pound into too. This is known as rental yield. Why settle for 3.57% gross yield plus capital appreciation when the same capital appreciate might be available with a higher yield.

If it makes sense as an investment property then ask yourself why you are looking to sell it.
.


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