Savvy investors will do their research before investing and finding the ideal investment property in the Mendip area is no exception to this rule.
I am often asked the question ‘Where can I find the ideal investment property?’.
Sadly, there is no simple formula to answer the question as there are so many variables that each property needs to be assessed on its individual merits when it is available for sale.
There are however a few pointers that may help investors make that difficult decision and in this article I will give you a flavour of what to look out for.
Capital Growth
Whilst rental yields deserve some focus, capital growth is the icing on the cake – you want some degree of confidence that when you eventually come to sell the property, the value has gone up.
Which areas are giving the highest capital growth?
Looking at the prices paid for property in the last reported 12 months and comparing the prices to those paid in the corresponding 12 months before, reveals some likely hotspots for capital growth in the area. Across all property types, the central wards of Frome represent 5 of the 9 wards with positive growth with Frome Market prices rising an average 15% in this time. Outside of Frome, the wards with positive growth in this short period are (in order highest to lowest):
What property types are giving the highest capital growth?
When I look at the property types and wards together, the wards with the highest growth in prices (in order highest to lowest) are:
- Semi-detached – Frome Market
- Terraced – Glastonbury St Edmund’s
- Terraced – Glastonbury St Benedict’s
- Terraced – Street South
- Terraced – Frome Park
- Flats – Wells Central
- Flats – Frome Market
- Semi-detached – Frome Keyford
- Terraced – Frome College
- Flats – Frome Park
Rental Yields
When we look at the property types and wards together, the wards with the highest rental yields (in order highest to lowest) are:
- Flats – Wells St Cuthbert’s
- Detached – Glastonbury St Edmund’s
- Flats – Glastonbury St Benedict’s
- Flats – Street North
- Semi-detached – Street West
- Flats – Shepton East
- Terraced – Glastonbury St John’s
- Flats – Wells St Thomas’
Number of Bedrooms
1 or 2 bedrooms – by 2031 almost 3/4 of households in the Mendip district will be one person households or couples and the average household size will have fallen to just 2.1 – 37.2% of households will be one person households and couples will represent 36% of households. Between 2006 and 2031 one person households will see the largest growth (46%) of any household type.
Proximity to Local Amenities
Close to local amenities and good transport links – poor provision of public transport in rural areas and increasing congestion on our roads mean many people will want to live close to local amenities – centres of employment, doctors, schools and shops.
Gardens
Garden over no garden – most people prefer some outside space over no outside space.
House or Flat
House over flat – service charges, ground rents and sinking fund contributions that are part of flat ownership will eat into profits.
Garages
Garage over no garage – few people use their garage to store their car but value the storage space a garage provides.
Parking
Parking over no parking – increasing dependence on the motor car as our primary mode of transport means increased demand for parking spaces and with many of our roads now congested even street parking is at a premium.
Old or New
Modern over old – generally older properties = higher maintenance = more work and cost = less profit.
Energy Efficiency
Under law enacted in 2018, the minimum energy efficiency rating for letting a property is now ‘E’. There are however proposals that the minimum rating should be increased to ‘D’ and at a later date ‘C’. So to future-proof your investment, consideration should be given to the current energy efficiency rating and the likely cost of upgrading the property to achieve a higher rating. Also, a more energy efficient property is going to have wider-appeal to would-be tenants.
For detailed boundary maps and postcodes please refer to Ordnance Survey Ward Maps for Mendip and click on the link for your ward.
About Tom Morgan
Founder of Jungle Property the multi award-winning letting agent based in Glastonbury, Somerset. I am passionate about property and Glastonbury and about providing the very best advice to anyone who wants the best return on a buy-to-let property investment. For an open and brutally honest opinion on anything in the Glastonbury property market please contact me via tom.morgan@jungleproperty.co.uk
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