23 March, 2015
So, you're contemplating buying a property in Crowthorne with plans to then let it out? Great idea!
Crowthorne is a fantastic location; near enough to London for commuters, but far enough removed that the village truly gives residents an idyllic, peaceful lifestyle. It's so popular, in fact, it was voted the second best place to live and bring up a family in England and Wales (Family Friendly Hotspots Report 2013).
As for any destination, regardless of how perfect it looks, landlords must do a bit of research before signing on any dotted lines. So if you're an existing or prospective first-time landlord and you've decided Crowthorne is your preferred location to invest, you're in the right place. Here's a guide to buy to let in the village.
Average property price/size in Crowthorne
First, let's take care of the nuts and bolts of property buying. Assuming you have a specific budget in mind, how will it match up to property available to buy in Crowthorne?
According to Rightmove, the average cost of a detached property in Crowthorne is £519,813, while the average cost of a semi-detached property is £399,813, and for flats its £200,586
When all properties currently available for let are taken into consideration, it makes for an overall average price of £389,774.
Here are some other overall average prices for near-London locations, for comparison:
Guildford - £425,876
Luton - £182,268
Reading - £273,910
Slough - £171,581
Landlords must also take into consideration the size of the property in terms of bedrooms, should they wish to change their letting and opt for a shared accommodation setup. According to home.co.uk, there are more one bedroom property rents currently on the market in Crowthorne than any other size - which could include both rooms to rent in a shared house and one-bedroom flats.
However, the most common property types currently on the market in Crowthorne are houses offering two to five bedrooms. Assuming that two-bedroom houses are the most common, it would mean that target tenants are likely to be professional couples or sharers.
Best Crowthorne property in terms of average yield
Home.co.uk's rental price analysis collates information presented on various property search engines. According to its research, the average property in Crowthorne rents for £1,016pcm.
But how does that break down by type and number of bedrooms?
Average rents by property type:
Room - average rent £471 pcm
Flat - average rent £796 pcm
House - average rent £1,415 pcm
Average rents by bedrooms:
One bedroom - average rent £757 pcm
Two bedrooms - average rent £979 pcm
Three bedrooms - average rent £1,399 pcm
Four bedrooms - average rent £1,850 pcm
Five bedrooms - average rent £1,950 pcm
So, the average annual yield of a landlord in Crowthorne by property would be:
One bedroom flat - £9,084
Two bedroom house/flat - £11,748
Three bedroom house/flat - £16,788
Four bedroom house - £22,200
Five bedroom house - £23,400
What can landlords expect from the area?
Well, for starters, landlords can expect impressive yields compared with the potential monthly mortgage repayments. The figures above are just average, after all.
The real money making opportunity for landlords will come over the next four years, however, as Britain's house prices are predicted to rise 18.2 per cent between 2015 and 2019. This would mean that a £650,000 detached house purchased now could be worth £768,300 by 2019 - earning the savvy landlord £118,300.
On a local level, the property market in Berkshire is enjoying a steady rise. Overall sold prices in the county increased by nine per cent over the past 12 months, and are 12 per cent higher than the 2012 level (£300,048). If sold prices continue to increase at this rate, landlords in Crowthorne can expect to see fast returns on their investments.
Finding tenants in Crowthorne
Buy to let is all about maximising the return on your investment through reliable rental income, and in order for that to happen the tenants living in your property must be reliable too. Far too many landlords don't fully consider the importance of finding the right tenants; if they fail to pay rent on time, you'll be out of pocket and will have to spend time chasing them; if they move out as a result, you're back at square one with an empty property and no money coming in.
As more landlords place greater emphasis on finding the right tenants in Crowthorne, often with the help of specialist local estate agents, the impact on the market has been clear. The May 2014 HomeLet Rental Index revealed that the average tenant signing a rental agreement had an income 7.2 per cent higher than the average tenant a year previously, berkshirepropertymeet.com reported.
The same report from June 2014 showed that rental fees in Greater London were now "pushing the bounds of affordability", standing double the UK average. It's no surprise, then, that more and more people working in the capital are looking for homes outside of the city and the extortionate rent. Crowthorne has become a popular home for commuters. Working with a local estate agent who can take care of the whole process - from finding suitable tenants, taking references, drawing up agreements, and collecting the rent for you - means you can focus your attention elsewhere.
With the property market continuing to grow, there has never been a better time to invest in a buy to let property in Crowthorne. The area is only going to become more desirable, particularly to commuters, and the amount tenants are willing to pay is also on the up. All of this makes for a fantastic buy to let opportunity for any landlord.