Tempest or Berewood Estate - Which Makes The Best Investment?
Updated: Nov 11, 2018
A landlord approached me for advice, just before Christmas, asking whether he should buy a two bedroomed semi-detached house on the Tempest estate or within the new Berewood estate.
We did some research and found that a nice two bedroomed semi-detached house on Anvil Close, a cul-de-sac off Tempest Avenue, for £225,000. We worked out the possible rent for this is £850 per month, which could achieve an annual yield of 4.5%. The properties in this area are quite popular with families and tend to have a great demand with investors and tenants alike, making it a relatively good investment.
A similar two bedroomed semi-detached house on the new Berewood development, off Hambledon Road, approximately two miles away, has a value of approximately £280,000. The possible rent for this property is slightly higher, at £1000 per month, as it is slightly larger than the one on Anvil Close. We found that although the rent can be higher, the annual yield was similar at 4.2%.
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, please call us.