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As I am sure you know if you are reading this, the location of your investment property is vital. It will determine your numbers and how much profit you can make from a property which is why it is so important to carry out due diligence on an investment area.
So what can you do to ensure that you have chosen to invest in the right area?
Here are some of the most accurate ways and sites you can use to identify whether a location will be a good spot to invest in.
Google Maps.
It's always essential to check exactly where a property you are looking at is located on a map, so you can get a clear idea of how close it is to amenities. Google maps is a great way to identify what is surrounding an area.
You want to be looking for shops and large institutions like hospitals or supermarkets which produce jobs for the area and boost the economy. Is it close to a train station or a bus station? Is it close to a dual carriage way or motorway for potential tenants or home buyers to travel to work?
These are all things you will need to consider when deciding on an investment area. Make the little yellow man on google maps your best friend.
You can drag and drop this little guy on any road which will give you a street view of the location you’re looking at. What do the houses on the street look like? Are they looked after? Is there reasonable parking? This tool can be great for exploring areas quickly to gauge an idea of what the area is like and the sort of tenants or buyers you can expect, without the hassle of travelling to the area.
Although this is a fantastic tool to use, look for the dates that the images were captured as they can often be slightly outdated.
StreetCheck.
StreetCheck is a fantastic way to get a closer look at the tenant demographic of an area. It gives you a good idea of the housing tenure and the sort of people who are already currently living in the area. Do they match your targeted tenant/buyer criteria?
StreetCheck can also tell you about the employment rate of an area as well as it's crime rate. This makes it a great tool for running enhanced due diligence on an area.
Land registry/Rightmove sold prices
One of the most popular and most essential tool for running basic due diligence. The land registry or Rightmove's sold house prices will show you how much any property has sold for. You should only be looking for properties sold within the last year which are 1/4 - ½ mile maximum, away from your chosen location. You can also look at pictures of properties which have sold on Rightmove and Zoopla on their previously sold house prices section. This will give you a good idea to what standard the property is refurbished to and if it is an accurate comparable.
National EPC register
The national EPC register is another fantastic way to run enhanced due diligence in an investment area. Legally, every property must have an EPC certificate to be marketed. You can find it by searching the post code into the website. At the top of each EPC certificate will tell you the size of the property in square metres. This is a fantastic way of seeing if a property is similar in size to an investment you're looking at. It can also give you an idea of how much a property could be valued/sold at.
It makes it easier to compare the property you're looking at with the most accurate comparable so you are comparing "apples with apples".
Local Estate Agents.
Local Estate agents are great way of finding out information about a particular area, as they are going to know it well. Ask them how many properties they have sold in an area. Do they have much interest in them when they come on the market? Speak to their lettings department. What properties in the area do they currently manage? How much rent are they achieving? What are the tenants like?
It can be very useful to get recently sold prices from estate agents rather than the land registry as the land registry can often take a while to be updated which makes estate agents' comparable much more accurate and up to date.
All of these methods for due diligence are great to enhance your knowledge of an investment area. Enhanced due diligence is essential to ensure that you run your numbers as accurately as possible.
Thanks for reading.
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