Saturday, 2nd May 2026
Welcome to the Reid & Co blog! Today, we are diving into a real-life scenario that perfectly illustrates why we value honesty over a quick commission. Sometimes, the best move for your portfolio is the one that involves staying exactly where you are.
Recently, a prospective client booked a call with me to discuss a Preston city centre apartment. He was frustrated with his investment and ready to walk away. But after we crunched the numbers together, the "obvious" choice to sell didn't look so smart anymore.
Here is the breakdown of why we advised him to keep his property, how the math worked, and why "selling up" isn't always the solution to a low-performing asset.
In 2024, our client purchased a modern apartment in the heart of Preston. Like many investors, he was drawn to the "off-plan" model. It promised a brand-new build, high tenant demand, and the prestige of city centre living.
The Financial Starting Point:
On the surface, £300 a month sounds like a decent "hands-off" income. However, the client wasn't impressed. He felt the £45,000 he had locked away in the property should be working harder. He came to us asking to list the property for sale so he could find a "better" investment elsewhere.
Preston is a thriving city with massive potential, but the off-plan market has specific quirks. As we’ve seen with developments like The Exchange, new-build apartments often command a "newness premium" at the start. When these properties hit the secondary market (resales) just a year or two later, they often struggle to maintain that initial high valuation while the local market stabilizes.
We looked at comparable properties in the immediate area. Realistically, we told him the apartment would likely sell for £110,000 today.
Most people look at a £119k purchase and a £110k valuation and think, "I'm only losing £9,000." Unfortunately, that is not how property math works. You have to account for the "exit costs."
The Exit Calculation:
Now, look at the initial investment. The client started with £45,000 cash. If he sells today, he walks away with £33,000.
That is a £12,000 loss.
In the investment world, a loss is only "on paper" until you hit the sell button. By selling now, the client would "crystallize" that £12,000 loss. It would be gone forever.
I asked the client one simple question: "If you had that £33,000 in your bank account today, could you find another investment that safely pays you £300 every single month?"
To get £3,600 a year (£300 x 12) from a £33,000 investment, you would need a net yield of nearly 11%. In the current UK market, finding a reliable, low-risk 11% net return (after all costs) is incredibly difficult.
The reality was clear: despite the dip in property value, the asset was still performing better than almost anything else he could do with that remaining cash.
Instead of selling and losing £12,000, we proposed a different strategy. We told the client to keep the property but change how he viewed the profit.
Many landlords use their monthly "rent profit" to fund their daily lifestyle. This is a mistake if your equity position is weak. We advised him to treat the £300 as "property money," not "lifestyle money."
Since he has an interest-only mortgage of £74,000, the debt never goes down. By taking that £300 net profit and paying it directly back into the mortgage every month, he starts a powerful chain reaction:
Preston is seeing significant investment. Over the next decade, the "newness premium" of the apartment will fade, and it will become a standard, established part of the city centre rental stock. By holding the asset, he gives the market time to catch up to his original purchase price.
As estate agents in Preston, we could have easily taken the listing. We would have earned our fee, and the solicitor would have earned theirs. But the client would have been £12,000 poorer.
At Reid & Co Property Group, our commitment is to the long-term success of our clients. We want you to build a portfolio that actually works. Sometimes, that means telling you that the best thing you can do is… nothing.
If you find yourself in a similar position with a property that hasn't grown in value as quickly as you'd hoped, follow these steps:
The client left our meeting feeling relieved. He wasn't "stuck" with a bad property; he was "invested" in a steady asset that just needed a better management strategy. By focusing on mortgage overpayments, he is now on a path to total recovery of his initial deposit and beyond.
Are you unsure whether to sell or hold your Preston property? Don't make a decision based on a hunch. Get the facts, do the math, and get an honest opinion from local experts who care about your bottom line.
Contact Nick and the team today for a transparent, no-obligation chat about your property goals.
