London, E3 2QE | Investment Property for Sale | VES-E3-001

Opportunity to purchase an apartment in East London generating £18,002 rent pa and a gross yield of 4.5%

£400,000

Apartment

VES-E3-001

INITIAL INVESTMENT

£186,300

GROSS RENT / YIELD

£18,003 / 4.5%

NET RENT / YIELD

£13,644 / 3.4%

The property

TENANCY

Tenanted

TENURE

Leasehold

GROUND RENT

£250

SERVICE CHARGE

£174

2 bedrooms

1 bathroom

1 reception room

618

Unfurnished

Leasehold information

  • Length of lease: 125 years
  • Start of lease: 2000

This property comes with a parking space.

Market Trends

Sales Trends

  • Prices in E3 have increased 31% over the last 5 years (+1% over the last 12 months) and are £430k which varies by property type (£331k for a 1-bed flat to £1.1m for a 5-bed terraced property (this area has insufficient data for detached).

  • On average, there have been 58 properties sold per month in the area in the last 12 months.

  • In comparison, prices in the wider East London postcode area are £445k (0% over the last 12 months) and range between £336k for a 1-bed flat to £1.94m for a 5-bed detached property.

Rental Trends

  • Rents in E3 are now at £1,630 per month (-6% over the last 12 month). On average, there have been 145 properties listed for rent per month in the area in the last 12 months.

  • Given prices in the area, gross yield is currently 4.3% which is lower than the national average of 4.7% and higher than the wider E area of 4.2%.

  • This property is currently achieving a gross yield of 4.5% which is line with the area.

Source: REalyse - 16/04/2019

Tenancy

RENT

£18,003 p.a. / £1,500 pcm

TENANCY DEPOSIT

£2,077

TENANCY TYPE

AST

TENANCY AGREEMENT STARTED

10 months ago

TENANCY AGREEMENT ENDS

5/31/2019

Floorplans

Documents available on request, please contact for viewings or further questions.

The information relating to the property is supplied by the vendor and the latest available at the date of listing.

Certain information may expire or become inaccurate over time and should be verified by the purchaser’s solicitor.

Financials

Rental Income

GROSS RENT PER ANNUM

£18,003

Equivalent of £1,500 per calendar month (PCM).

GROSS RENTAL YIELD

4.5%

Gross rent per annum divided by the purchase price.

NET RENT PER ANNUM

£13,644

Gross rent per annum minus fully managed operating costs.

NET RENTAL YIELD

3.4%

Gross rent per annum minus fully managed operating costs divided by the purchase price.

FULLY MANAGED OPERATING COSTS

£4,358

The total estimated sum of expenses calculated annually assuming a fully managed service.

Click to understand assumptions.

Disclaimer

This information is for illustration purposes only and does not constitute advice. It is correct at the time of writing. For advice specific to your personal circumstances, please speak to a financial adviser.

About Tower Hamlets, E London

  • Tower Hamlets is located east of the City of London and north of the River Thames in East London and includes the postcodes E and EC.
  • The area comprises of 20 districts such as Bow, Aldgate, Canary Wharf, Stratford, Leyton, Poplar, Hackney, Olympic Park.
  • It is also home to a number of famous tourist attractions Tower of London, Tower Bridge, Columbia Road Flower Market and Billingsgate Fish Market.
  • Canary Wharf is located on the Isle of Dogs in East London and is one of the leading financial districts in the United Kingdom. It primarily consists of modern buildings and is one of London’s newest areas, containing many of Europe’s tallest buildings.

Economy

  • 3rd highest economic output of any local authority area in the UK, next to Westminster and the City of London.
  • In 2015, the borough’s economic output was around £29 billion – accounting for 2 per cent of the UK economy.

Population

  • Continues to be one of the fastest growing, youngest, and most diverse populations in the UK - almost half are aged 20-39 (46%).
  • Median age in 2017 was 31.0 years which was the 4th youngest LA in the UK. The median age was 35.1 in London, 39.8 in England and 40.1 in the UK.
  • Population is 308,000 and is projected to reach 365,200 by 2027 – equivalent to around 15 additional residents per day for the next ten years.
  • Since 1986, the population has more than doubled – making Tower Hamlets the fastest growing local authority in the UK.

Households

  • Over 54,000 new homes are expected to be built in the borough by 2030/31.
  • The fastest household increase of all LA’s in England & Wales - +29% between 2001 (78k) and 2011 Census (101k households).
  • The number of households is projected to reach 160k by 2028 (28k over the next decade) from 134k in 2018.
  • There were 101,247 households recorded at 2011 Census, a 29% increase on 2001.
  • The borough has been significant change in the borough’s tenure profile. Around 39% of all households are in private rented accommodation (tax records for 2017 suggest the sector accounts for 39% of the housing).
  • Tower Hamlets accommodates an estimated 12% of all student accommodation in London. The most recent survey data available from 2015 estimates there are approximately 7,000 student bed spaces in the borough, the third highest proportion after Camden and Islington.

Businesses

  • The borough has 16,800 businesses (+55% in the last 5 years), 278,000 jobs and is home to some of world’s largest financial institutions (March 2017)
  • The borough has a wide range of local businesses including small family companies, creatives, start-ups, light manufacturers and small-to-medium-sized enterprises – 98% of local enterprises are small businesses which employ fewer than 50 people.
  • Employment is dominated by the finance industry. 44% of jobs are concentrated in Canary Wharf and 26% are in the finance and insurance industry, making it the borough’s largest employment sector.

Connectivity & Transport

  • The borough’s overall connectivity is high with its surrounding areas.
  • The borough is well served by several train networks and has 31 public transport stations (3 mainline, 12 underground, 16 DLR) and will have, in 2018, two Elizabeth line (Crossrail) stations at Whitechapel and Canary Wharf.
  • The majority of routes are east west in orientation. However, the Overground, parts of the Docklands Light Railway (DLR) and the mainline are north south. These lines link the borough with destinations, such as, central London, Heathrow Airport in the west, Cambridge to the north east, Southend in the east and to Lewisham as well as Crystal Palace in the south.

Prices

  • Prices have decreased -3% over the last 12 months and are now £463,000. On average, there are 239 sales per month (61 sales recorded in Feb 2019).
  • Rents have decreased -4% over the last 12 months and are now £1,800. On average, there are 841 listings per month (946 in Feb 2019) which has decreased from 2468 in Aug 2016. Gross yield is 4.2% have increased over the last 12 months versus 3.6% in Feb 2018.

Paton Close,

London,

Greater London,

England,

E3 2QE

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