Why is the North the best place to buy investment property?

The North East of England is historically known for its pits and miners. As well as things like Newcastle united football club, the famous stottie and some of the most beautiful landscape in the entire British Isles.

But its not about any of that which makes the North the best place to invest in the UK. Its down to the yields and net returns that can be achieved.

It is common to find houses and flats that are at least 15% discounted that yield 10% per annum and give an investor a Net return of 15% plus.

This type of deal is common. Below is an example of a property with some numbers attached to put some meat on the bone!

Purchase price - £40,000
Value - £50,000
Discount - £10,000
Percentage – 20%
(Some lenders will lend on a purchase of £40,00 but it is limited)
Deposit(20%) - £8,000
Mortgage - £32,000
Mortgage rate(I stress test at 6%) - £1920pa - £160 per month
Rental - £425
Insurance - £20
Voids and maintenance(Estimate) – 20% - £85
Management – 10% - £42.50
Net profit -  £117.50 per month
Net ROI(Return on investment) on Cash input – 14.68% (The only cost missing is the initial sourcing fee and any mortgage arrangement fees)

As you can see the numbers speak for themselves and we have included pretty much everything in the calculation. Not chosen to ignore significant costs like some sourcers do.

The figures are purely for example.

We base our decision on whether a property fits our model by looking at the rental market for that particular area, the ROI when we run the numbers and generally the deal itself. Is the condition of the property acceptable, does it need work, can we add value.

There are many factors that we take into account when we analyse a potential deal.

This is what you are paying us for…..our experience and knowledge of what’s good and what’s not. Anyone can go and buy a property from an Estate agent having watched homes under the hammer and decided they want to be the next property millionaire. But its not quite as simple as that.

There are parts of the North East where you can pick up houses for £10-£15,000 but you wouldn’t buy them for putting animals in. The key is area knowledge, one street of a town may be horrendous but 2 streets away and its one of the nicest parts to live.

It all comes down to our experience, knowledge and contacts. To find suitable property for you.

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Why is the North the best place to buy investment property

"Not only did they make the whole process easy to understand they found the right solution for our needs at a budget we could afford."
Michael Price