‘Flipping’ Heck - Warrington Property Values Rise by £21.97 a day

Investing in Warrington buy to let property is different from investing in the stock market, or depositing your hard-earned cash with the building society.

When you invest money in the building society, this is considered by many as the safe option. However, the returns you can achieve are awfully low (the best 2-year bond rate from Nationwide is a whopping 0.75% a year!). While the stock market can give good returns, it’s a very ‘hands off’ investment - unless you are on the phone every day to your broker. It can also leave a feeling of lack of control.

Investment Properties in Warrington

“With buy to let, things can be more hands on.”

One of the things many landlords like is the tactile nature of property – the fact that you can touch the bricks and mortar. It is this factor that attracts many of Warrington’s landlords. They are making their own decisions, rather than allowing city whizz kids in Canary Wharf to play roulette with their savings.

Investing in property is a long-term game. When you invest in the property market, you can earn from your investment in two ways. When a property increases in value over time, it is known as 'capital growth/capital appreciation'. This has been strong in recent times in Warrington. The value of property goes up as well as down, just like shares do, but the initial purchase price rarely decreases. 

Rental income is what the tenant pays you – hopefully this will also grow over time. If you divide the annual rent by the value (or purchase price) of the property, this is your yield/annual return.

Over the last 5 years, the average Warrington property has risen by £40,100 (equivalent to £21.97 a day), taking it to a current average value of £205,600. Yields range from 6% a year and can reach double digit percentages (although to achieve those sorts of returns, the risks are higher).

Flips in Warrington

However, something I haven’t really spoken of in detail before is the more specialist area of flipping property to make money.

“FLIPPING - buying a property, carrying out some minor cosmetics and re selling it quickly.”

I have seen several investors recently who have made decent returns from this strategy.

·         One Warrington investor paid £125,000 for a three bed semi on Keyes Close in March 2016. It appears some cosmetic work was done to the property and it was resold a few months ago (November 2016) for £150,000.
That’s a 20.00% return before costs! (Or a compound annual return equivalent of 34.42% AER.) http://www.rightmove.co.uk/house-prices/detailMatching.html?prop=43307643&sale=89153106&country=england

·         Another Warrington investor flipped a lovely three bed detached property on St Bridgets Close, paying £159,950 in September 2016 and selling it again after some doing some cosmetic works. It was sold for £179,950 a few months ago (December 2016)!
That’s a 12.50% return before costs! (or equivalent 10.22% AER.)
 http://www.rightmove.co.uk/house-prices/detailMatching.html?prop=56283706&sale=89152779&country=england

This demonstrates how the Warrington property market has not only provided very strong returns for the average investor over the last five years, but how it has permitted a group of motivated buy to let Warrington landlords and investors to become particularly wealthy.

As I have mentioned before, more and more Warrington people may be giving up on owning their own home and are instead accepting long term renting. This leaves buy to let lending to grow from strength to strength. If you want to know what (and what would not) make a decent buy to let property in Warrington, then one place for such information would be the Warrington Property Blog.

Email me on manoj@hamletwarrington.co.uk or call on 01925 235338. If you are in the area, feel free to pop into the office – we are based on 6 Bankside, Crosfield St, WA1 1UP. There is plenty of free parking and the kettle is always on.

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