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Great value for “buy to let” investors in Swansea Bay – if you know where to look

The letting market in Swansea Bay is booming, says Laura Thomas, who runs the local office of specialist agency Red Key Property Services. The challenge for prospective investors is knowing where to look for the best return on their investment…

The development of Swansea Marina has given those of us working in property locally a real boost over the last few years: creating such a fabulous place to live has brought new people to the area, and a host of attractive properties to sell and (especially for agencies like mine!) to let.

But sometimes the “Marina market”, which is very different from the rest of Swansea Bay, has overshadowed the very active letting market in other parts of Swansea… and, indeed, neighbouring Port Talbot and Neath. When someone comes to us and asks for advice on investing in a buy-to-let property we will show them what’s on offer at the Marina – and encourage them to take a look too at the value available in the less fashionable locations.

Swansea letting market set to grow

The fact is, there are a lot of people looking to rent rather than buy – either due to the challenges of getting into the property market or because of the greater flexibility that renting offers. And many will want as much space as possible for their budget, or need to live close to where they work.

Add this to the indisputable fact that more and more people would love to live in this special part of the world (and who wouldn’t!) then there’s no question that the local letting market looks set to continue growing: our office has seen a terrific growth rate since we opened our doors in November, with new landlords and tenants being added to our books every day.

So what can you get for your money?

A two-bedroom apartment in SA1, offering around 600 sq ft, will set you back between £700 and £750 a month. An “up together” two bedroom house or apartment in (Port Tennant, Swansea) will be closer to £550; in Neath expect to pay £475 and in Port Talbot £450

The upside for a potential investor is that getting into the market will mean a much lower outlay: those same properties will set you back £150,000 in the Marina, £90,000 in Swansea, £85,000 in Neath and just £75,000 in Port Talbot.

That opens up the market for someone with a much smaller investment pot, while the ROI (return on investment) will typically be between 5 and 6 percent once costs are taken into account: a handsome alternative to the miserly rates on offer from the banks and building societies, not forgetting the added bonus of the real prospect of capital growth.

What’s more, with a good letting agent on your side, much of the work is done for you: we will help you identify potential properties, then manage the whole letting process.

If you’d like to know where the smart money is going in Swansea, just give me a shout!

5 Responses to “Great value for “buy to let” investors in Swansea Bay – if you know where to look”

  1. Thanks for this useful article.

    It would appear that many seaside cities are being blighted by large numbers of HMO’s used to house vunerable social tenants.

    Is that the case in the less fashionable areas you mention?

    Are the rental figures you are giving examples of LHA or private tenants?

    What sort of tenants does the area attract?

  2. Tony Watts says:

    Hi Vanessa, thanks for the feedback, not to mention the follow!

    Had a chat with Jamie (I help out with the SM), and here’s his reply.

    Certainly there appears to be a longstanding issue of housing benefit tenants finding their way into seaside towns, almost certainly because of the national shortage of social housing. For hard-pressed B&B landlords seeing their incomes slide as we holiday abroad, it’s one way to keep afloat. But there can be an issue if (as you say) too many vulnerable people are housed in what can be inappropriate long term accommodation.

    That said, our portfolio is focused on private, working tenants in areas like Swansea, Cardiff, Newport and into the South West, and these are the rental figures we’ve given: “less fashionable” in this context are places like Neath and Ebbw Vale – where there are lots of perfectly good houses in nice areas which can be snapped up for very reasonable sums. We’ve got waiting lists of prospective tenants for these places – working families, couples and individuals employed in local offices, factories, care sector etc.

    The key point we wanted to make was that – in terms of ROI – you can do just as well or even better than trendy spots such as the Marina, and you can start off your portfolio very cheaply (a £20k deposit for a 75% mortgage buys you an £80k apartment or house).

    We’d also always recommend having a buffer of a few months’ mortgage payments at the very least to allow for repairs and voids.

    Happy to chat further!

    • Michael La says:

      Hi Tony.

      My name is Michael. I am due to move to Swansea in August 2014 for a year and new to the property market in Wales (very different to London). I am planning to live there for at least 12 months (then let out) and have been looking at new developments such as Copper Quarter. Just would like some guidance on good investment areas in SA1 for rental yield and capital appreciation (budget would be £150,000).

      Hope you can help.


  3. Thanks for the response and good to hear that you have a waiting list of good tenants!

    I always believe that, as investors, we have to find the demand before we create the supply, so it sounds like the supply in your area is very healthy! :)

  4. David Williams says:


    I have £30,000 immediately available for investment; a further £65,000 in approx 3 months and a further £50,000 from selling a local property could be made available. I am 69 in January.

    What purchase strategy do recommend please?

    David Williams

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