Strawberry Hill or St Margarets? It's all about the yield.

A landlord dropped me an email, just last week, asking whether he should buy a two bedroomed flat in the Strawberry Hill or St Margarets area. He likes and knows both and so would be comfortable investing in either. I hear this a lot, and whilst it probably won’t produce the greatest return, if you are much happier investing in your own area then do it. Life’s too short to be worrying about a property 100 miles away that, whilst it may get you an extra 2% yield, may also give you 100% more stress!!

We did some research and found that a nice two-bedroomed leasehold flat in a very attractive block called Stangate Mansions off Tower Road in St Margarets, was on the market for £419,950. We worked out the possible rent for this as £1450 per month, which could achieve an annual gross yield of 4.1%. The properties in this area are quite popular with professional couples and tend to have a great demand with investors and tenants alike, making it a relatively good investment.

A similar two bedroomed leasehold flat on Popes Grove, just around the corner from the station in Strawberry Hill, approximately two miles away, has a value of £599,950. The possible rent for this property is slightly higher, at £1800 per month, as it is slightly larger and a higher spec than the one on Tower Road. We found that although the rent can be higher, the annual gross yield was actually less at 3.6%.

This shows that, whilst a property can achieve a higher rent, it does not necessarily mean higher returns!
                      


If you would like any advice when choosing properties, please do get in touch as I’d be happy to help. There’s the right property out there for everyone if you’re ready to invest!

Rebecca Smith

http://www.rebeccasmithpropertyservices.co.uk/