Housing market: Churchdown vs Shurdington

                               St Bartholomew's,  Chosen Hill ,Churchdown 

I was recently talking to someone who lives in Badgeworth, that lovely village between Cheltenham and Gloucester. He wanted to purchase his first Buy to Let property and had noticed my previous articles, so was interested in getting to know the industry a little bit more. As he has lived in the village for over 18 years and he felt comfortable investing around there as he knew it well, we started to discuss the property market in his area.

He asked what my thoughts were on the village of Shurdington, as it appeared to him that made an excellent place to start. Yes, of the 857 properties in the village, the average rent achieved for the rental properties over the last 6 months has been £1,786 per month and with average values at £297,800, that makes ‘on paper’ a very healthy 7.2% pa yield. However, the issue is that there are only 36 rental properties in the whole of the village and in the last 6 months, the only ones that have come up for rent have been those at the upper end of the price scale, meaning it affected the figures considerably. I have a large database going back as far as 2000 for both the Cheltenham and Gloucester of just about every property that has rented and its rental price achieved. This database enabled me to tell him that the long term yield in the village was much nearer the 3% to 4% mark, depending on the year in question. Also, due to what type of properties have been built in Shurdington (mostly cottages and middle/up market houses), he might have to wait a long time for a suitable property that would have good tenant demand (lower to middle terraces and semis) to come along.

However, with my local knowledge I was able to tell him that literary a stone’s throw away, on the other side of M5 was the village of Churchdown. There is a much more vibrant rental market, with over 491 properties under rent (representing 9.9% of the households in the village compared to Shurdington’s 4.2%). Values in Churchdown have risen at a faster rate in the last 5 years, rising by 18.8% compared to Shurdington’s 15.2%. Also, there are plenty of 3 bed semis in the village which can be bought for around £230,000 to and they rent for around £850 per month, a healthy yield of 4.4% per year, especially since 1999, semis in Churchdown have on average risen by around 189% in value. Interestingly the larger properties in Shurdington have only risen (although the number of comparables is very low) somewhere in the order of 140% to 160% depending on location within the village.

So with a reasonable yield and excellent capital growth, I recommended he consider Churchdown for a quicker investment instead of waiting potentially years for the miniscule chance a semi in Shurdington may come onto the market. If you would like to pick my brains on the local property market, feel free to pop through the door of our offices in either Cheltenham or Gloucester or email on neil.west@belvoirletitngs.com