The phenomenon of posh tenants in 'dodgy' areas

Heres a conundrum for you.

Where do professional landlords go for landlord insurance?

I have a house in one of the more 'culturally mixed' areas in Nottingham. These areas are often dirty places, inhabited by hooded youths clustering on street corners and have more than the odd stray dog marking out their territory on their grimy streets.

The house I own is a bog standard 2 bed terrace, which I did up nicely several years ago with cast iron fireplaces, new kitchen and bathroom, etc

Despite its location, this property has attracted some of my poshest tenants.

Previous tenants were a couple India and Spencer - definitely not working class names. Spencer had a decidedly private school drawl and this couple are just about to replaced by Elizabeth and Edward. This makes me reflect on research that came out several years ago about the young professional classes being attracted to more culturally mixed areas, attracted by their ethnic diversity and vibrancy.

Happening Hoxton

A visit to London's Hoxton and Shoreditch over the weekend confirmed this view. The run down streets were full of 20 somethings seeking pleasure and experiences all attracted by the places slightly edgy feel. I don't think I saw anybody under 30.

These areas can often provide landlords with some great letting opportunities as properties tend to be cheaper than in more established areas but rents are strong and there is always the potential for more rapid capital appreciation as a result of gentrification. Landlords should however be cautious about putting too much faith in the power of gentrification, especially outside London where housing demand pressures are less likely to shift values above trend, especially in the short term.

However, landlords looking for an investment bargain should 'check out' these areas. You never know you might end up with some right 'Royal' tenants.