A potential investor asked if they should buy a 3 or 2 bed semi detached property to rent out to tenants. The first question I asked them was what was are they looking for from the investment - capital growth in the property or a great yield?
Answering this question will help you figure out which properties you should buy...The average asking price of a 3 bed semi in Andover is £234,920 today compared to £202,535 for a 2 bed semi. The 3 bed semi achieves an average rental price of £940 per month compared to £780 per month for a two bed semi.
That’s a yield of 4.6% for the 2 bed against 4.8% for the 3 bed. So surely, the 3 bed semi is the better bet? Well it does offer a better rate of return, but a 2 bed semi is slightly easier to rent out (less void periods) and will be easier to sell in the future. The main thing to remember if going for the 3 bed is always make sure that the third bedroom is of a reasonable size rather than just a box room as this can make it difficult to left.
Pop into our office, call or comment below if you have any questions.