avoid bad neighbourhoods when you buy
AVOID BAD NEIGHBOURHOODS WHEN YOU BUY
Always avoid bad neighbourhoods when you buy property, whether to let, to live in yourself or to improve.
Bad neighbourhoods can be harder to spot than you think and demand real, close local knowledge.
We all learn by making mistakes and I am now exception to this. These days, I think I have now learned all the key things one needs to know. So, surprises are rare – though often a tenant will do something surprising, (sometimes good, sometimes bad), that no tenant has ever done before.
But the things that go wrong today no longer cost me money or time.
But it was not always like this.
I tried to include everything I know in my book “Successful Property Letting” – see the link in the footnote – so that landlords would be able to learn from my experience.
But I thought it would be good to write the occasional blog post about some of the worst properties either I or my clients have owned.
This first one in this occasional series is the shortest and easiest to describe and is the story of when I bought in the wrong neighbourhood.
Some years ago, I bought a property in a town that I thought had good prospects for rental and capital growth. The town was one I knew well from my childhood and visited regularly, but I did not actually live there. I had already bought one property in that town, and it had gone quite well, but it was still a big step outside my comfort zone, as all my other properties are within 40 minute drive of where I live in London. This town, however, was one and a half hours away.
There always seemed to be some problem or other.
The first problem was that one of my very good tenants, who were retired and home a lot in the day were plagued by noise from a dog barking next door – the lady owner would leave all day when she buggered off for work. The dog got distressed or bored and it would bark, more or less incessantly.
Of course, we tried to reason with her about the logic of getting a dog walker to come in, even once a day to walk the poor distressed animal, but no luck. So, in the end we had to get the Environmental Services from the Council involved. (RSPCA were not interested in this case – and do not consider a dog left home alone to be sufficient abuse).
It was a very, very slow road to collect the evidence for the Environment people, it involved my tenants recording the noise – and then the Council people had to actually witness it too. Not easy as they were based 10 miles away. All the time, the lady owner of the dog was given warnings, things would go quiet for a bit, then the problem would restart.
In the end, after about a year, she was taken to court and fined over a thousand pounds after which it went quiet again for a few weeks. Then the problem re-started, and we were advised we would have to once more start collecting evidence. My tenants, by then, were worn out and had had enough. They gave notice and left.
The new family I let to were not bothered about dogs barking at all, but now issues emerged with the house next door on the other side. So, more anti-social neighbours, plus a damp problem emerged, which it turns out was common in this low-lying area.
By now I had had enough too of this lowest renting property in my portfolio. Too much work, too much aggravation, so I bailed out and sold.
So, what was the lesson here?
Well, it seems that whilst my first property in this town was in a good neighbourhood, this one was not considered to be so. To me, both roads looked more or less the same, but people who lived in the town knew different – and this was the reason the street where my second property was tended to attract less good people and it explains why there were more problem neighbours.
Also, for a while there, I had used a tradesman for small jobs who later turned out to be not very good at all – and his botched fixes led to a lot of re-work.
Unlike in London, I was not as much in the loop and connected to good local tradespeople in that town. In London, with more properties under my ownership I have access to a better class of tradesman, plus being closer, I can more easily follow up with spot checks on any work they do for us.
I still have the other property in that town. That one has done OK, but a lot of this is down to having the same very decent tenant who has been there for 15 years and is quite un-demanding. (I also charge her a rent about 15% below market, as I am aware the property is now quite tired).
My advice is to invest close to home if you can. You will know the good and bad areas very well. Better than you think, in fact.
Sure, if you see a great opportunity outside your area, go for it, but bear in mind that if you intend to let it, you will not have as good access to local networks of good tradespeople. (TrustPilot can only take you so far!). Also, it is harder to identify good and bad streets without detailed local knowledge. So, do a lot of extra work on the ground before you buy to avoid those bad neighbourhoods.
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