Is 'Buy to Let' in Worthing a Good Idea?
Investing in property has long been a popular long term plan and as well as growth in the capital invested, property owners have enjoyed the rental income from their tenants which helps – if not covers their mortgage re-payments and many of the other expenses incurred.
In 2019 with the uncertainty of other investment channels, property is still a popular investment and the 'buy to let' property sector has considerably expanded in recent years. The number of people now opting to rent long term has also increased. At 36.6%, the figure for long term renters is the highest it has been since 1965 and the rental market is still developing quickly. Most rental properties are still taken within a number of days or a couple of weeks at most.
If you are considering 'buy to let', it is worth making some good research first. Talk with your solicitor about your ideas and get all the current advice about tenancy agreements – don't be tempted to make a 'DIY' job, get your solicitor to draw up a legally binding agreement. Your solicitor will also explain your responsibilities as the landlord. In the past, landlords were able to deduct all their financial costs from the rental income. This is no longer the case and landlords now receive a basic rate reduction from their income tax liability for their finance cost. This new scheme is currently being rolled out over a four year period and for 2019/ 2020 (the third tax year) there will be a 25% finance cost and 75% given as a basic rate reduction which has deterred some investors who require loans.
The other point to consider at this stage is that 'buy to let' is best run as a business and it is money well spent to sign up with a professional letting company to manage the property.
It is true that the company will take a slice of your property income each month (anywhere from 8% -15%), but will look after your property well and ensure regular maintenance is carried out and if a problem does develop with your tenants, the letting company is 'worth its weight in gold' as it will have the experience and contacts to deal with things promptly and effectively.
But Why Worthing?
Worthing is simply a great place to live for all ages! Worthing has come out of Brighton's shadow and is proving life there is just as good! Living by the sea is beneficially healthy for everyone and with five miles of beautiful shingle beach to walk on, romp on and simply stretch out on, it is certainly great. For water sports enthusiasts, there is catamaran sailing and kitesurfing amongst others.
Reasons why Worthing will be popular with tenants include:
• Good schools and children's activities
• Plenty of good amenities for retirees.
• Comprehensive shopping centre.
• Excellent commuter service from Worthing Station – just 90 minutes to Victoria
• Good road network to Brighton (12 miles) and Chichester (19 miles) and swift access to all main roads.
• Good amenities including a multi-swimming pool centre and well-appointed gym centre, restaurants, pubs and coffee shops.
If you are considering buying in Worthing it is good to find a letting agent in the early stages as they will have plenty of local knowledge about where best to buy as well as which type of property is in greatest demand and other key requirements such as being within walking distance of schools or the station to catch the train to London. With their advice on the type of property that rents well you can start looking for properties.
At present, the average rental price in Worthing is £983 per calendar month and there is a total of 291 properties currently available; with 67 being one bedroomed, 104 two bedrooms and 64 three bedrooms. The three bedroom properties are the most popular and being rented out in the shortest time. It is interesting that what we are saying about Worthing being good for 'buy to let' is not such a well kept secret after all.... 60 new properties have been listed recently within the town.
If you decide to look at suitable properties to 'buy to let' there are some key points to consider.
Points to Look For
• You need a property that is in really good order and has no serious maintenance issues.
• The property must be in good decorative order and if it is not, decide whether you are happy to put this right.
• Off road parking is always a plus factor, but if it is not available, is there good parking on the road immediately outside with no restrictions? Is the road wide and well lit?
The Best News, We Have Left till Last
Property prices in Worthing are noticeably lower than in Brighton and other towns in the area with a three-bedroomed family home costing on average £300,000 and a two bedroomed flat about £175,000 – a pleasant surprise as these prices can make great yields for landlords.