Doing your due diligence. Hilgay or Tormead Road?

A landlord came to our office for advice recently asking whether he should invest by buying a three bedroom house in a more affluent area within a short distance of the town centre.

We did some research and found a reasonably sized three bedroom townhouse, within an affluent area of Guildford, a short walking distance from the town centre, in Hilgay, a cul-de-sac off Cross Lanes. This could be purchased for £411,500 and then rented out at £1,475 per month, to achieve an annual yield of 4.3%. 

Properties in this area are popular with families because there are a number of private schools located close by. These include Tormead, Lanesborough, Guildford High School plus George Abbot School so there is great demand from investors and tenants alike, making it a relatively good investment area. 

3 bed townhouses in Hilgay off Cross Lanes

Hilgay is located within a 10 minutes walk of the town centre with London Road railway station nearby, providing links to both Guildford mainline and all stations to London Waterloo. Stoke Park and the Spectrum Sports Centre are positioned across the London Road and there is access to Merrow Downs not far away. Active families are therefore able to enjoy both town and country life here.

A place on which to sit with neighbours on Tormead Road

We then compared the property in Hilgay with a more spacious and therefore bigger three bedroomed detached house on Tormead Road to determine if the landlord would gain more financially, by buying there. The two streets are five minues walk apart, located at either ends of Cranley Road. A 3 bedroom detached house in Tormead Road could be purchased for £749,500 and then rented out at £2,495 per month, to achieve an annual yield of 3.99%. 

Three bedroom houses in Tormead Road

While the rental on the property in Tormead Road is a thousand pounds more expensive the annual yield was similar. This shows that while properties can achieve a higher rent than others in the same geographical location it does not always suggest there will be higher returns for the investor. 

More importantly an investor could purchase an investment property in this desirable area, where there is high demand for rental property, for a lot less than they might have thought possible all because they have done their due diligence on what type of properties are available, and at what price, on various roads within a specific area. In this instance our landlord might have to forgo one reception room but who eats in a dining room nowadays?

If you would like any advice on doing your due diligence when choosing properties in a particular area of Guildford or a general discussion on investment opportunities in the area your call will always be welcome. Phone 01483 320207 or email richard@guildfordpropertyblog.co.uk