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This week in the news

16 August 2019

A round-up of the week’s news from Together and the world of property.

Bank-of-dad comes to the rescue with a buy-to-let remortgage

A landlord stepped in to save his son’s dream home purchase by releasing equity against one of his own rental properties – with the finance provided in ten days.

The son had had an offer on his dream house accepted but risked the sale falling through unless he found £21,695 - within 12 days - as a down payment to secure the property.

His father, who owns a buy-to-let portfolio, approached a broker who brought the case to us.

We agreed to remortgage the rental property over a 25-year term and at 48 per cent loan-to-value (LTV) - releasing the funds within ten days - and allowing the customer’s son to fulfil his dream of home ownership.

Chris Duckworth, business development manager, said:

“The clock was ticking. We worked closely with the broker to pull out all the stops, making sure the bank-of-dad was in a position to come to the rescue.

“This type of case demonstrates how we were able to work together with the broker to find an innovative solution and provide the best outcome possible for his client.”

Smaller towns and cities offer strong rental returns

Towns and cities with smaller population sizes are home to some of the highest average rents, research from ideal flatmate has found.

The research reveals that major cities with populations of more than 500,000 people attract the greatest level of tenant demand and see the highest rents – including cities such as London, Leeds, Manchester and Sheffield. However, some of the smallest towns and cities, where population sits between 50,000 to 100,000, are home to an average rental cost of £732, climbing to £807 in towns and cities with a population of between 100,000 and 150,000.

This increases further still to £830 per month for a population between 150,000 and 200,000. However, at this point the average cost of renting drops as populations start to increase with the best value for tenants being found in towns and cities with a population between 300,000 and 500,000, with the average rental cost at just £628 per month. This means that cities such as Liverpool, Bristol, Cardiff, Coventry and Nottingham offer some of the best value for tenants.

(Source: https://www.mortgageintroducer.com/smaller-towns-and-cities-offer-strong-rental-returns/)

Five renovations that could improve rental returns

The growth in the number of rental properties available over recent years means renters can often afford to be a little more discerning in their choice of property.

Some renters are happy to pay over the odds for the most desirable or practical properties, and landlords can increase their rental income by making some shrewd improvements.

1. Focus on kitchens and bathrooms

The old adage says that that kitchens and bathrooms sell houses, so it stands to reason that the same should apply to rental properties.

Giving an investment property a bit of attention could help it rent out faster, and for a better price. A renovation doesn’t have to mean a complete rip-out-and-replace affair. Small changes such as painting the walls, replacing cupboard doors and handles should ensure both kitchen and bathrooms are sparklingly clean when it comes to viewing.

2. Add a conservatory

If the outside space allows, a conservatory could be a relatively inexpensive way of increasing the amount of living space available – especially for new-build family homes, which can sometimes prioritise bedrooms and leave the layout of the house unbalanced.

A conservatory also help to emphasise fashionable indoor/outdoor living, and act as a bridge between a kitchen or lounge and the garden.

3. Use light smartly

As a general rule, larger homes command larger rents. And since light can make a home feel larger, using it intelligently can boost income. Roof lights and light tunnels can introduce natural light to dark spots and attic bedrooms, cleverly placed mirrors can amplify the effects of natural light, and replace bulky curtains with blinds that can be fully opened during viewings.

4. Create an en suite

Dividing off part of the master bedroom to create a small en suite bathroom can make a property more appealing, especially to young professional sharers. In a two-bedroom property, this will give them a bathroom each.

While this in itself may not increase the rental price significantly, it could certainly make it easier to rent out – reducing void periods, and therefore contributing towards a larger overall rental income.

5. Refresh the garden

Outside space is the Holy Grail for some renters, so presenting a garden as both tidy and useful can help inflate the potential rental income.

Landlords needn't go to great lengths with expensive plants or water features, but ‘zoning’ the space can help potential tenants visualise their life there. Perhaps create somewhere with seating, and leave a portion of space open if your target tenants are families with children.

Remember that turf can make a garden more high-maintenance, so could be a turn-off for some renters.


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