I was recently asked by a friend of mine if he should buy a fairly standard three bedroom semi detached house in Picket Twenty or a slightly larger version with a garage.
We did some research and found a nice, nearly new three bedroom semi detached house with garage on Turnpike Road which was marketed for £275,000 should achieve a rental value around £1150pcm giving an annual yield of 5%.
A slightly smaller three bedroom semi in the same area was recently sold for £250,000 and would attract a rental value of around £1000pcm giving an annual yield of 4.8%.
Both properties would be popular with young families, especially with the local school growing in popularity. However, it does show that, spending more, won’t necessarily earn you a much higher return in the long run, even with a higher monthly rental income..
This shows that while a property can achieve a higher rents, it does not necessarily mean higher returns.
If you would like any advice when choosing properties, you may come and see us at our offices.