When investing in Medway property, landlords should seek rentals that have decent yields alongside good prospects for capital growth. The following property fits the bill as a possible house share, or a home in multiple occupation (HMO), with a potential yield of 7%.
The property is an end of terrace house on Barnsole Rd in Gillingham. It looks to be in a good condition with space for 5 bedrooms, with double glazing throughout. Each room should rent out for £350 per month and being situated half a mile away from Gillingham train station it is attractive to tenants who commute.
Properties in this area usually let in around a week, so if each room is empty one week a year then I would factor in around a month’s void period every year into the rental yield calculation.
Even with a month’s void period per year the rental yield comes to 7%, which is a very decent figure. However, renovation may be needed to add another bathroom or separate en suites on the first floor as it shares two double bedrooms. This decision would have to involve assessing capital outlay against reward as such work could cost around £8,000 and necessitate void periods while construction is carried out.
Medway house prices for terraced properties have risen in Gillingham by 32.98% over the past ten years; that is similar to Chatham at 30.51% but lower than Rochester, which increased by 35.63%. Therefore, expect similar capital returns to the rest of Medway but with a good rental income in the region of £19,250 per year.
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