One bedroom flats in Tamworth. Are they good investments?

Last week I was at a business networking meeting (I’m not plugging this) and met a plasterer who was also an investor. His portfolio consisted of ex local authority houses, four bed if possible, as he could get these for a decent price and the rental gave him a good return[and only ‘swore’ by this type of property].  Albeit he wasn’t as fussy as some landlords, as to who he rented too. Well I’m one who likes to wind the men up and thought I’d challenge his views, after all,  are not one bed flats equally as good  a return and sometimes less hassle than large number of  bedroom properties.  Anyway, we agreed to differ and I decided to look into Tamworths flats in a little more detail, this is what I have found….

There are over 4628 flats in Tamworth.
This represents around 13.72% of the total housing stock in this area.
The average price of a one bedroom flat is around £85,000, this figure has seen hardly any movement since last year.
Looking at the demographics of Tamworth it’s interesting to know that 31.7%  of the popluation are single, so perhaps the singletons do want to rent one bedroom flats.

You can buy a one bedroom flat in Tamworth for a reasonable price of £85,000 and these can rent for up to £495pcm, depending upon the condition and the location of the flat. If a landlord was to put down a deposit of £17,000 (20%) and borrowed the rest, even after the mortgage, service charge and property management fee, there could still be a nice little cash flow.

I haven’t taken into account voids, different mortgage interest rates or service charges, so before jumping in to buy and commiting yourself, you must remember to do your full research.
Lastly, let’s not forget about the potential for capital value on the property. I looked at a one bedroom flat that sold in 2001 for £48,950 at Alexandra Mews.There was a slight down turn following the crash but with values  here starting to increase again with recent sales in this area at £75,000 the potential is there, for those lanlords who are in property for the long haul
As always my advice is, speak to me, speak to others, remember to get the best advice and expert opinions you can. Most importantly do your homework. As long as landlords buy the right sort of property, that allows for a reasonable yield and/or decent capital growth, everyone will be a happy winner.
If you’re a new or experienced investor and are considering buying in the local area then please feel free to get in touch with me if you’d like a second opinion. You can call me on 07531484956 or email lorraine@hallandthompson.co.uk and I’ll get back to you personally.

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