9 things you should NOT miss when choosing an investing area

 In my last post, I talked about the danger of doing TOO MUCH research.

In this post, I want to share what to cover in your area desktop research, to avoid doing too little research.

Here are the 9 things to check when considering an area to invest in, and how to do a quick high level assessment:
 

1. Typical property types

Is the ‘average’ property in this area terraced houses, or flats? How many bedrooms are the most common? Are they Victorian conversions or ex-local properties? Just by browsing through Rightmove, you should get a rough idea.
 

2. Average rents for the above typical property types

For each ‘typical property type’, what is the average rent? Again, you can get a rough idea from Rightmove or Zoopla.
 

3. Sales prices for the above property types

For each ‘typical property type’, what is the last sold price and price moves over the past few years. You can find this on Rightmove.
 

4. Gross yield for each property type

With each of the ‘typical property types’, do a quick calculation of the Gross yield. Gross yield = Annual rent/ Sales price
 

5. Know your area by postcode

You should ideally know your area by postcode – sometimes two postcodes right next to each other could be the best and worst investing areas. I used a tool called PropertyData to get data by postcode. Very useful and worth paying a small price for, especially in the beginning of your property journey. Definitely check it out if you are serious about investing in property.
 

6. Is this area ‘up and coming’ or ‘slowly dying’?

You can pretty much just Google this one. What are the news related to this area (city/borough)? What are people’s first impression of this area when mentioned? I know I have advised against reading too much news on property investing. This one is different. What you want to know is ‘other people’s opinion’ towards this area – because what they think impacts whether they want to rent or buy there.
 

7. How far is it from where you live?

This is a realistic question. In the beginning, you will inevitably be travelling to this area frequently, before you build up a trustable team. This is also true if you use a sourcing company. You still need to know your area to be able to tell a good deal from a bad one. And don’t just check the distance on Google map. Check the actual time required to get there considering your chosen way of transport.
 

8. The nearest major employer hub

A quick Google on this one should do. The purpose is to gauge the whether there will be a stable supply of potential tenants to the area, and the tenant profiles.
 

9. Variety of local demographics

It’s always good to invest in areas with a variety of local demographics who could become your potential tenants. So search for any university, major employer (see point above) in the area. And don’t forget that local families are always a good source of potential tenants (except for central London).


To summarise, the above 9 things should never be missed. At the desktop stage, you can start with doing a high level quick assessment before you decide to focus on a particular area. Google, Rightmove, Zoopla, PropertyData have been my best tools and resources – make use of them!


Happy data crunching :)
Emma

*I can teach you how to build an extra £2000/month income through property within 6-12 months – CLICK HERE to book a free strategy session with me.