Hello Medway Property Investors,
When investing in property, it is important to have a strong knowledge of the area that you are looking at purchasing in so you can determine things such as demand, yields, and house price growth, etc.
Very often, people tend to look at a town, however from my experience there can be areas within a town that perform better than others and it is therefore important to have a good understanding of the market at a more granular level.
An example of this is how, from personal experience, I know that some areas within the Medway Towns are better to invest in than others. These areas do tend to differ when looking at an HMO, single let, or serviced accommodation.
I have recently been spending time looking into this and come across some very interesting data that reveals everything investors need to know about prices, rents, yields and more within Medway by postcode sector. This data is a bit of a goldmine and I hope you find it helpful!
When looking at average asking prices, there is a significant difference between the cheapest average prices in ME4 and the highest average prices in ME3; with prices in ME3 being 33% higher than ME4!
ME4 Is mainly Chatham and this statistic confirms previous research which highlights how properties here tend to be cheaper than the neighbouring boroughs of Rochester & Gillingham.
Avg Asking Rent
When looking at rents, the average sits at around £1,000 per month, however, there is some degree of variation. I have compiled ME3 using limited data, so whilst this is an anomaly it is still a helpful indicator.
Rents have significantly increased over the past 12 months and this has simply been led by a surge in demand as COVID-19 has begun to affect the property market. The Medway Towns have seen overall rental increases on average of £100 per since April 2020!
I have broken this down in the table below and it is interesting to see how ME4 stands out once again! The data for ME3 was not available, unfortunately.
So, what of average yields? It is probably no surprise that Chatham (ME4) stands out once again at 4.6% average yield due to a strong mix of property price and rent. Rochester & Hoo (ME3) certainly is slightly higher, but this is just an indicative figure.
Using this data, on average you are looking at a yield of 4.3% for the Medway Towns and this compares to an average of 3.5% for the DA, ME and TN postcodes and 3.7% across each postcode sector for the UK as a whole.
Based on this statistic, investing in the Medway towns tends to get you a 16% better yield than the current UK average!
Sales And House Price Growth
This statistic is very interesting as whilst the Medway Towns have seen house price growth of around 7% over the past three years, this is significantly different if you look at each postcode sector.
I would take this data as being more indicative than absolute and there will certainly be a delayed effect due to the length of time it is taking for sales to complete.
Interestingly, where Chatham (ME4) tends to have a strong yield, it is Rochester & Hoo (ME3) and Gillingham West (ME7) that stand out more in terms of house price growth.
I do know a number of landlords who have seen significant growth across all postcode sectors, so this statistic may be hampered by the number of sales per month in each area.
I trust that you have found this article helpful. I will be spending some time looking into demographics data in my next blog ad reflecting on how this impacts the rental market as well as looking at data relating to HMOs.
If you are considering a property investment and would like to find out more, remember that I run tailored discovery sessions to provide property investors with all the tools they require to either make their first investment, move into a new area, review, or expand their portfolio.
Sessions last two hours, cost £147 and have proved extremely helpful to both novice and experienced investors alike. You can find out more and book a session here.