Newlyn - Is it the New New Thing?
Once or twice a week I have a conversation with somebody who is thinking about buying a holiday cottage and if they don’t have a fixed idea on location they want advice on where to buy. Which places will make the most income compared to the capital value and where do I think the capital growth will be best?
My first response is always to invoke Simon’s rule which is it’s most important to buy something that suits you that you will love. If you compromise and buy a cottage that you don’t like the best or doesn’t have the space you really want because it looks a better business proposition it’s likely you’ll end up regretting it. When you have to fork out for a replacement boiler or new roof it’ll be much less painful if you are improving something that’s special to you and the more you enjoy coming the more often you’ll use the place which is what gives you a value from your investment that’s greater than money.
Broadly speaking yields tend to be proportional to the capital value of the property- you pay more for a great sea view in a popular town but you get more income from the rent so the decision is usually more about what you can sensibly afford- being stretched on the finances and losing money every year generally doesn’t make for a happy owner.
Capital growth however is a little more variable. The market has been through some ups and downs this century but the right property in the right place in Cornwall has often remained steady in the dips and outpaced many in the boom years and so done much better than average over the long term. Every now and then however a location can emerge which becomes more fashionable and those who were in early can really benefit.
Porthleven was a place where this really happened just around the turn of the century when it suddenly seemed to be discovered and prices rose very rapidly over a couple of years. This seemed to set off a virtuous cycle with improvements to the restaurants, shops and buildings attracting more visitors and purchasers which in turn encouraged further improvements. I appreciate that not everybody was enthusiastic about these changes but there’s no doubt that the village I am looking out on as I write this is a much more attractive place to live in than it was 20 years ago and there are many more jobs and opportunities for those who want to live and work in the village.
Newlyn has always held a special attraction to me as I first came to Cornwall to work there as a fisherman in the early 80’s but I think it’s fair to say that the Saturday nights I spent there when the whole fleet was in would not have encouraged anyone wanting to dine alfresco and I don’t think you could get tapas in The Swordfish! Now every time I go there it seems that another interesting development has appeared or a new business opened up and for me the watershed moment was when the fabulous new cinema opened as a conversion of the fish merchants where I used to haul in boxes of skate and monkfish all those years ago.
I’ve been pointing new owners at the town for a while now and I’m really hoping that Newlyn will be a growing location for us for years to come. When somebody took me to the excellent Mackerel Sky seafood bar this week the rose tinted spectacles descended in such a big way that I started to think I could live here and that hasn’t happened for a long time.
Now we do need to add a dose of caution here as if you want to look for it there’s plenty of less attractive aspects to the town and as a supporter of the industry I sincerely hope it will be a proper working port for years to come. About 15 years ago I was involved in investments in Ilfracombe in North Devon which was on the up as Damien Hirst opened a restaurant and proposed an iconic sculpture but things never quite happened and the 2008 crash saw most people lose money. As we used to say in the industry be aware that investments can go down as well as plummet!I’m convinced though so if you have a holiday cottage in Newlyn or are thinking about one get in touch and I’ll make sure you are really well looked after.