Buy-to-let on the up in Surrey, say local property professionals
The Surrey towns of Reigate and Redhill have long been popular with buy-to-let investors, but the area has been particularly lively recently. Increasing house prices have taken many out of negative equity, prompting them to put their houses on the market, and new-build developments coming through offer a wide range of investment properties.
Close to London, but in the heart of the Surrey countryside, the towns also enjoy good road and rail links to Gatwick airport and Sussex coast, making them a popular alternative to city living, and creating a lively rental market.
Local estate agency Leaders has offices in both Reigate and Redhill. Branch manager Jean Carter says that buy-to-let is busier than ever with 11 of her 13 most recent sales going to buy-to-let investors and two to owner-occupiers.
Carter says: “This has always been a popular area for buy-to-let investors and the market is very buoyant at the moment across a range of property types. Compared to the higher prices in areas of south London such as Croydon, the return from investing in property a few miles further from London is very attractive. Both Redhill and Reigate benefit from good journey times to the capital, making them ideal areas for the rental market.
“The average rental value of a thee-bed property in the RH1 postcode is between £1,300 and £1,400 per month, while in RH2 postcodes in Reigate, we're looking at something above the £1,500 mark. This rental return is reflected in prices, where good RH2 three-bed properties are selling for around the £420,000 mark, £60,000 more than for the same property type in RH1.”
Carter, who has been an estate agent for ten years, also believes that changes to the pensions rules will mean more people will enter the buy-to-let market.
She adds: “Many of our recent buy-to-let customers have been those with good-sized portfolios, say between 20 and 30 properties. I think that some people with larger pension pots will see a monthly rental return as an attractive alternative to an annuity and use the new opportunity to take their cash and become first-time buy-to-let investors, in towns like Reigate and Redhill.”
Elsewhere in Surrey, buy-to-let investors are active in the market and new home developers are seeing properties being snapped up by those looking for an investment.
Ten miles from Reigate is the village of Cheam. Part of the London Borough of Sutton, Cheam also enjoys good rail links to the capital but is more affordable than central London.
Queensbury Place is a development of one-, two- and three-bedroom apartments in the heart of Cheam Village by award-winning homebuilder Crest Nicholson, and has proved popular with buy-to-let investors.
Christine Tiernan, sales and marketing director, Crest Nicholson South remarks: “The majority of buy-to-let investors at our Queensbury Place development in Cheam, have been amateur local investors looking to maximise their savings by investing in property rather than have them sitting in the bank earning very low interest.
“They have been attracted to this particular development due to its great location near to local amenities and fantastic transport links to London, making it the perfect home for commuters which means the properties are being let very quickly and will enjoy very few, if any void periods.”