If you’re an investor looking to put your money in bricks and mortar, it is often a toss up between investing in flats or going bigger and getting houses. Each has its own set of advantages and drawbacks, so it’s worth taking a closer look to see which suits your needs better.
Flats or apartments tend to be cheaper than houses (unless you’re looking at the high end of the market) so you’ll get more for your money. In general, you can get a two bed flat for around 15 to 25% less than a house of equivalent size. That’s because having your own entrance and a garden are seen as more desirable.
However, flats still rent out easily in city. For a two bed, you’re looking at around £600 to £800 a month for a standard flat. Purchase prices start at around £100k and go up from there. So, depending on what you’re buying, there are some good yields to be made.
On the downside, when buying flats you have to remember there are associated costs. Usually you don’t own the freehold so will be subject to maintenance and ground rent charges. These can be costly and while some can be passed on to tenants, not having control of your own building can be a pain. Especially when repairs are carried out.
The benefit of buying a house is that you usually own the freehold, so there are no costly charges and you can do work as and when you want to, not when the freeholder decides.
Having your own entrance and garden space means your properties will appeal to a broader market, with families often making good tenants. The average prices are, of course, higher with the cost of a house in Norwich now at around £223k. So you will have to pay more for your property and your yield will probably be lower. However, there will be advantages in terms of sell on price, and the possibility to add value over time with extensions is much greater.
In the past two years in Norwich, house prices have gone up by around 8% a year. Which means at the current rate, a £200k house could be worth £232k in just two years time, plus the rental income you can get during that period.
Choosing houses or flats very much depends on your individual position. If you’d like to know more, then why not get in touch with a member of our team? We’re experts in the Norwich property market and are happy to talk through your options.
To find out more about the local and national property market, or if you would like to chat about anything to do with property investment, give us a ring on Norwich 01603 567804 or send us a message.
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