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The Numbers Don't Lie! Do They?
The Numbers Don't Lie! Do They?
15/02/2020
It's always good to stay ahead of the game in any business, and property investing is no exception. Continual market research of different areas in the UK helps us to understand whether we should be moving into a new town/city to invest. There are various ways analyse a specific area via a desktop without leaving the comfort of your sofa; a few simple calculations can let you know that there is a good demand and strong financial returns. For many investors, they never visit their investment areas, and a couple of sums would give them to all the reassurance they need to buy a property - But is that really enough to confidently say that our hard earned investment is secure?
As a seasoned investor, I recently conducted my usual market research and following the above methodology, it appeared that Barnsley (a town in South Yorkshire) ticked all the right boxes. The strategy I was looking to adopt in the area was professional house shares, and the demand vs. the supply seemed like it was the perfect opportunity.
If you spend any time at property networks, you'll be familiar with the 'hot investment areas' of the year, and Barnsley had been on my radar for a while. I'd heard a lot of chat about how it was an untapped area, and that you could achieve high returns.
In my experience, number crunching doesn't necessarily give you the full picture of an area, and the only way to really understand is to have a look around and see whats going on.
The following day I took a drive around Barnsley, and despite all the hype, the reality was that the area was on the brink of over-saturation. Every other other house surrounding the town centre had To-Let signs hanging off the exterior walls, with countless empty rooms, and a string of unlucky landlords stuck with negatively cash-flowing properties.
It's easy as a property investor to get caught up in the numbers, and the excitement of a potentially high passive income opportunity. In a few months, I'm sure the over-saturation would have become apparent from whatever investment calculator spreadsheet is cool right now; but the market was at a turning point, which no part of excel can work out for you - Always do your due diligence.