scottish property news
 

Rental Hot Spot

 © Evening Times
Originally published: 16.03.2005

Identifying where the next property hot spot is going to emerge is one of the tricks of being a successful investor, but it is not without its risks. While the large commercial estates can afford to take a chance on some down-at-heel district as it tries to negotiate the route from bohemian to bijou, it is not always the right move for the private investor.

Specialist buy-to-let broker Landlord Mortgages actively counsels against attempting to identify up-an-coming districts. "Unless you have reliable information, don't buy in an 'undiscovered' area," says managing director Lee Grandin. "It could be that it is undiscovered for a good reason."

Yet despite that sound advice, there are plenty of bold investors who have made a fortune out of spotting which areas are on the up.

One way in which they do this is by counting the coffee bars. When a branch of Starbucks opens, it usually means that a critical point in the process has been reached.

However there are more scientific ways to conduct your research. Start by logging on the www.myhouseprice.com and comparing the asking prices for properties against the figures that are actually being achieved.

If there is a sizeable margin between the two, then it is a clear sign that people are willing to pay over the odds to move into that area.

Check out what plans the local authority has for your chosen street. You can do this by logging on to their website and following the links to the Local Plan. This is the council's mission statement and it sets out their intentions, usually for at least the next decade.

If there are areas around your street that have been identified for investment, then these will show up here. You can then ask for further information from the planning department about the progress of any initiatives.

New supermarkets, leisure facilities and the refurbishment f schools are all worth noting, as these are the kinds of upgrades that help to improve an area.

Even so, it can take time for improvements to translate into house price rises. Longer-term residents may remember what happened in Glasgow's Merchant City. After a flurry of initial excitement in the early 1980s, investment stalled for the best part of a decade.

Now, however, it has become one of the most vibrant and sought after parts of the city and those investors who hung on during the lean years can congratulate themselves on their boldness and foresight.

The ideal situaiton, of course, is for a large investor to buy up all the property around your flat, including commercial premises and then invite trendy food shops, restaurants and boutiques to move into the area.

When this happens, speculative investors who have taken the risk of buying in a run down neighbourhood can really enjoy impressive returns.