‘Flipping’ Heck - Bexley Property Values Rise by £78.16 a day

Investing in Bexley buy to let property differs from investing in the stock market or depositing your hard-earned cash in the Building Society. Many consider investing in the Building Society the safe option, but the returns you can achieve are awfully low (the best 2-year bond rate from Nationwide is a whopping 0.75% a year!). The Stock Market can give good returns, but most invest in stock market funds rather than spending every day on the phone to the stockbroker, making the investment quite hands off; one always has the feeling of not being in control.

With buy to let, things can be more hands on. Many landlords like the tactile nature of property - you can touch the bricks and mortar. Bexley’s landlords are making their own decisions rather than entrusting them to whizz kids in Canary Wharf playing roulette with their savings.

Investing in property is a long-term game. You can earn from your investment in two ways. When a property increases in value over time, this is known as 'capital growth'. Also known as capital appreciation, this has been strong in Bexley recently. The value of property can go up or down, like shares, but the initial purchase price rarely decreases.  Rental income is what the tenant pays you, and hopefully this will grow over time too. If you divide the annual rent into the value (or purchase price) of the property, this is your yield, or annual return. Over the last 5 years, an average Bexley property has risen by £142,650 (equivalent to £78.16 a day), taking it to a current average value of £459,300. Yields range from 3% a year and can reach percentages in the double digits (although the risks are higher to achieve returns like these).

Something I haven’t discussed before is the more specialist area of flipping property (buying a property, carrying out some minor cosmetics and re-selling it quickly).  Recently, I have seen several investors who made decent returns from this strategy. For example, one Bexley Investor paid £290,000 for a 3-bed semi on Marden Crescent in April 2015. It appears some cosmetic work was done to the property, which was resold a few months ago (October 2016) for £387,000. That’s 33.45% return before costs (or compound annual return equivalent of 21.45% AER)http://www.rightmove.co.uk/house-prices/detailMatching.html?prop=54402136&sale=4493329&country=england

This demonstrates how the Bexley property market has provided very strong returns for the average investor over the last five years, and how it has permitted a group of motivated buy to let Bexley landlords and investors to become particularly wealthy.

As I mentioned a few weeks ago, more and more Bexley people may be giving up on owning their own home and are accepting long term renting instead. At the same time, buy to let lending continues to go from strength to strength. If you want to know what would (and would not) make a decent buy to let property in Bexley, you can find the information you need on the Bexley Property Blog - www.bexleyproperty.co.uk or pop into our offices located in the heart of Bexley Village.