Real Estate Investor Magazine South Africa July/August 2019 | Page 54

UNITED KINGDOM
Identifying property hotspots
for the best investment results
BY INKY DRESNER
52
JULY/AUGUST 2019 SA Real Estate Investor Magazine
just one hour. Essentially making Manchester a commuter city
for London. “This is bound to drive up property prices,” says
Bathurst.
“As always, old-school economics still applies,” says Bathurst.
“Look at the demand and supply ratio in the area. How many
homes are needed in the area to meet the current demand? Is
the demand likely to increase? If so, what initiatives are in place
to satisfy that? Often governments set targets nationally and
regionally to cope with housing shortages and developers may
be given incentives to invest in certain areas,” she says. “For
example, Manchester needs 55,000 new homes by 2027, but
only 3000 a year are being built, another reason this city is a
prime investment opportunity.”
“Make sure the area is a convenient place to live in,” she says.
“Places that have a supermarket, a school, access to a major
motorway or train line and local shops within a five-mile radius
are more likely to become future
hubs for homeowners.
“Also take a note of the
number of estate agencies in the
surrounding locations. Agents
have specialised tools and
strategies for identifying where
to have new branches. So, if there
are many agents springing up,
it is likely that this is an area to
consider.” This has been the case
in the Algarve, with new agencies
opening branches and adding
areas outside of the main cities to
their portfolio.
Lastly, says Bathurst, delis,
restaurants and independent
coffee shops are a tell-tale sign
that an area is on the up. “The emergence of independent
retailers suggests a demand from people with a higher level
of disposable income and this is always a good sign,” she says.
The suburbs of Birmingham are now bustling with retailers
popping up in the neighbourhoods close to the city centre.
“
The best advice is always to
consult with property specialists
when buying investment
property in areas you don’t
know well,
“
B
uying investment property in an area considered a
‘property hotspot’ will considerably improve the suc-
cess of your investment. This is especially important
when looking at buying property abroad, but how does one
identify a hotspot in places you don’t know well?
International property specialist and founder of Hurst &
Wills, Lisa Bathurst, has been buying and selling property in
cities around the world for 15 years. Her experience has given
her a lot of insight into what to look out for when considering
an investment property.
Bathurst says, “When you’re buying a property for yourself
or your family to live or holiday in, you only need to consider
whether the area – and property - suits your unique needs.
Basically, find an area you love and buy there. However, if
you’re interested in buying property abroad as an investment
that you’d like to rent out or eventually sell for a healthy profit,
there are other things
you should look out for,”
she says.
“A good tip,” says
Bathurst, “is to look at
previously undesirable
areas that have shown
price increases for last
three years. This is a
good indication that the
area is up-and-coming
and it’s likely you’ll get
better value for money
buying there.” Porto in
Portugal was almost
uninhabitable due to the
government’s
archaic
rental laws just seven
years ago, says Bathurst. “Since the law changed in 2012, the
city has seen a transformation and now offers some great
investment opportunities.”
Also do some research into what is happening with the
population in the area you’re interested in. Is it growing? What
is the average age of people buying and renting homes in the
area? “Places that have a high population of younger people,
in their twenties and thirties, will inevitably experience house-
price growth in a relatively short space of time,” she says. “The
majority of these people will be young professionals who will
require proximity to local retailers and transport links, which
will encourage more local business owners to the area,” she
says. Lisbon is attracting lots of young professionals involved
in tech start-ups and there are government initiatives to attract
business to the city.
It’s also a good idea to check whether there are plans
for future infrastructure and transport, she says. “Obviously
better infrastructure means higher house prices. Larger-scale
infrastructure or transport projects are often indicators of
initiatives that will bring employment to the area, and therefore
more families and potential tenants. This is likely to push up
the demand for houses and therefore rental prices,” she says.
The high-speed train, HS2, currently under construction in
the UK will cut the travel time from Manchester to London to
“The best advice is always to consult with property
specialists when buying investment property in areas you don’t
know well,” says Bathurst. “Independent specialists, like Hurst &
Wills, who are not tied to one developer are the best option as
we work only for the client. Rather than trying to sell a certain
development, Hurst & Wills is motivated to find the perfect
investment opportunity to suit your unique investment needs
and wealth strategy.”