In the past few weeks, we have seen plenty in the news about Swansea’s proposed regeneration. &1.3 billion has been allocated for projects in the Swansea Bay region, and so far, eleven have been identified, and they include not only the development of the St David's site, the Kingsway "Central Park" and, most recently, the redevelopment of Castle Gardens, but also the creation of a Waterfront Digital District, and a Life Science and Wellbeing Village in Llanelli. 

The specific details of the projects is still subject to change, but if agreed in principle on 1st March (2017), this will be great news for landlords and investors in Swansea. 

It's estimated that 9,500 jobs will be created in Swansea by the regeneration, and a further 20,000 jobs created in Wales in construction alone as the Tidal Lagoon, M4 Relief Road, Newtown Bypass and Eastern Bay Link get underway. The creation of new spaces for start-ups and small businesses in Swansea, as well as the creation of a new City Centre Business District, will further encourage employment in Swansea.

A 5G testbed would also be established with expansion of 4G and wifi capabilities to urban and rural areas.

Already, Wales is seeing employment levels rise to a twenty-month high as businesses expand in the new year. According to the latest Lloyds Bank UK Regional Purchasing Managers Index (PMI), the Welsh PMI rose from 57.4 to 59.6 in January, signalling a faster rater of expansion than across the UK as a whole (55.5). A reading of above 50 signifies growth in business activity.

So what does this all mean for the Swansea rental market?

Where there is employment, there is a need for housing. Not everyone will be looking to buy, and certainly in the construction industry,  businesses will be looking to relocate key members of staff to the area, who may have permanent residences elsewhere. Areas benefiting from a boost to employment and amenities should also benefit from an increase in house value. 

Better internet also means more desirable rental property. Properties previously dismissed by professionals, such as doctors at the hospitals and professionals who work from home, would then become more desirable, especially if they were in catchments for good schools that previously had poor internet connectivity.

City Centre apartments should see a surge in demand. Young professionals will want to be positioned close to work, but also to cafes, bars, and nightlife, and where better to be located for that than the centre?

Surrounding areas of the city should see a boost, too, with some professionals wanting more space than an apartment might afford, and better provisions for parking and access out of the city. 

Overall, most areas should see an uplift in demand for quality rental accommodation with the regeneration.

If you'd like to have a chat about the future of Swansea Bay and how it could benefit your property portfolio, please give the team at McCartan Lettings a call on 01792 430100. 

Looking to invest right now? Take a look at this currently tenanted apartment in the heart of the city which is on the market for OIRO &109,995.

Click here for the property brochure.

It’s currently getting &650pcm, but a similar flat we have also been managing has recently achieved &700pcm. If the redevelopment of the Kingsway and Business District is completed well, then a rental of &750pcm should be easily achieved. We’ve been managing this property since 2008, so have a full history.

I don't usually recommend flats due to the service charges, however, looking at the figures and expecting an uplift in the future rental income, this looks like it could be a good opportunity. Full details and figures are in the next article, 'Buy-to-Let Deals of the Month'.

Sources: Wales Online / Business News Wales on Employment Levels / Business News Wales on Infrastructure Projects / South Wales Evening Post 

Everyone has a slightly different requirement from their property investment, so understanding what your requirements are will be essential to your success.

Whilst researching into the success stories of others is a good motivator, property investment is not a one-plan-fits-all, so exercise caution when going to ‘buy property without a deposit/grow a property empire in 1 year’ property seminars. 

Getting the right property takes time and effort. Hopefully these ten tips will help you on your journey:

• Be focused in your property search. Knowing what you want will make it easier to work out what to look for. Make a list of reasons why you want to invest (keep it simple!) and keep it in mind when you actively start looking for property.

• Know your numbers. How much do you have to spend, what is your budget? Start by working out what the yield would be before even thinking about booking a viewing.

• Stay objective. Don’t get attached - this is not going to be your home! Having said that, it will be somebody’s home, and it must appeal to the widest possible market. Don’t buy a hole just because the figures work out well.

• Who will your tenants be? What type of tenants are you looking for, and what sort of property might they want to live in?

• Location, location, darling! Even the right property in the wrong location will never let for as much as you hope it will. Think back to where your ideal tenant will want to live, and start looking there.

• Keep your letting agent in the loop. Market trends do change, and your letting agent will be able to offer information and advice on what’s popular with various demographics. For example, 1 bedroom flats were super popular in 2005, but 10 years on, professionals are looking to save money by sharing 2 bedroom properties with their peers instead.

• Don’t be afraid to negotiate! A low purchase price will help increase your yield. Focus your search on distressed and motivated sellers (repossessions, part-exchange, probate).

• Consider potential renovation costs. Are you looking to refurbish completely, or does the property just need a lick of paint? A well-presented property is likely to attract tenants who will keep it well-maintained.

• Get the design right.  If you are re-modelling, ensure you are making the property better! Kitchen and bathroom layouts are essential to get right – get them wrong, and they will put everyone off.

• Get some great mortgage and tax advice. Get an independent mortgage advisor that really listens to what your long term goals are so they can advise on the best possible products on the market for you. Similarly a good accountant should be planning your future tax liabilities and advising you rather than just giving you a bill at the end of the year. Both will save you time, stress and most importantly money, which means more profit for your investment.

And an addition tip - our cousins in Estate Agency are great at what they do, but don't take their advice about how good a property will be to rent - after all they are trying to sell you the property.

If you are looking to invest in Swansea and would like some free advice about the best areas to suit your investment requirements, just pick up the phone and give me a call.

Happy house-hunting!

I have been asked a few times this month to help and advise on some more buy-to-let purchases under the &95,000 mark. What is noticeable online at the moment is a glut of property for sale in previously high rental areas, such as Plasmarl in the SA6 region. The temptation for investors growing their portfolios is to look at snapping up cheap property in areas like this. However the question has to be asked: why are there are so many on the market at the moment?

My thought is that there is an oversupply of rental accommodation in the SA6 area from the boom in the early 2000’s, and for various reasons, Landlords are looking to offload these properties. In my experience, although these properties are located well for various employment opportunities, the properties themselves are not appealing to young professionals anymore. Property in the Plasmarl area in particular are generally older terraced properties, and are increasingly in need of costly maintenance, and do suffer from big issues like damp.

It would seem that Landlords looking to decrease their portfolio size due to the tax changes, or just wanting to get out of the letting game due to increased legislation and lower profits, are picking their Plasmarl properties to off-load first.

So putting Plasmarl to one side, these properties could be worth some further investigation:

A 2 bedroom terraced house in Landor, SA5

All done and ready for a tenant to move into, rental income could be coming in within a month on this property. What is appealing is the standard of renovation, which would be sure to attract the attention of young professionals.

It's on the border of Brynhyfryd and Landor, close to Liberty Stadium and various employment with links to the City and M4. This would achieve in the region of &500pcm, and at a prospective purchase price of &85,000, brings in a yield of 7%.

I would question if there was any parking facilities (such as permit holders close by) here as it's on the main road. The parking issue may have an impact on long term growth and/or resale value, so along with not being able to add any capital value, this property would ideally suit an investor looking at more for rental income rather than capital growth.

Tip: Always confirm the parking arrangements if it’s not clear before booking a viewing! 

A 2 bedroom terraced house in Llansamlet, SA7

We’ve had great success on this estate recently, with property letting within a week or two. The Lon Enfys Estate is a quiet residential estate roughly 15 years old, with excellent links to the M4 and Llansamlet Enterprise Zone. This property offers excellent value for money accommodation for professionals - mainly couples, although we have also let to single professionals in this area, too.

This property would need just some light refurbishment, which we can help advise and source competitive quotes for. Rented for between &475-&495pcm, it brings in a yield close to 7%. 

Pearl House, Kingsway

Click here to view the brochure on Zoopla 

Admittedly, this one is outside of the parameters I was given. One of our own managed properties is currently on the market for offers around &109,995. The apartment is currently tenanted and achieving &650pcm, however, a similar flat we have also been managing has recently achieved &700pcm. What is different about this property is that it is one of only five that comes with allocated parking in the block.

If the redevelopment of the Kingsway and Business District is completed well, then a rental of &750pcm should be easily achieved. We’ve been managing this property since 2008, so have a full history of how to market it, who it appeals to, and what maintenance has occurred. 

I don't usually recommend flats due to the service charges, but looking at the figures and factoring in an expected uplift in the future rental income, this looks like it could be a good opportunity.

The drawback with flats is, as I've suggested, they will most certainly have ground rents and service charges to consider, and you may as well wipe them directly off the rental income (although you can offset them against tax - but we won't go into that for the sake of keeping this simple!).

The ground rent on Pearl House is &200p/annum, and the service charge is approximately &983.50 every six months - so basing the figures on &700pcm and a presumed purchase price of &105,000, the yield factoring in the above still comes in at a not-too-shabby 5.94%. Planning ahead, this could increase to 6.5% when let for &750pcm.

This apartment will always be attractive for professional sharers as it is still cheaper to share rent and bills than it is to rent a 1 bedroom flat on your own.

Even if these properties are not what quite what you are looking for, this should give you some insight into what questions you need to be thinking about when looking around.

Have you already got some investment properties in mind? Why not drop me an email with the brochure attached and I’d be more than happy to look over them for you and give you my thoughts! You can send them to [email protected].