Are one or two bedroom flats best in Chichester?

I spoke to a new landlord recently who was keen to buy a flat in Chichester to rent out. He asked me whether a one or two bedroom flat would be a better investment.

The answer to that question would largely depend on his budget and what he wanted to achieve from the investment (yield or capital growth).

Chichester’s one bedroom flats range in price from £120,000 to £265,000. Meanwhile, the cheapest two bedroom flat is £180,000 whilst the most expensive has an asking price of £450,000.

The average asking price for a one bedroom flat in Chichester at the moment is £170,000, compared to £260,000 for a two bedroom flat. One bedroom flats are currently achieving an average rent of £695 per month compared to £850pcm for the two bedroom apartments. That gives an average yield of 4.9% for a one bedroom flat against 3.9% for a flat with two bedrooms. Surely a one bedroom flat is therefore the better purchase?

Whilst one bedroom flats do offer a better rate of return, a two bedroom flat should be slightly easier to rent out, with fewer void periods and longer-term tenants. A two bedroom flat should also be easier to sell in the future rather than a more restrictive one bedroom property.

One bedroom flats tend to be the first step on the ladder and one that often doesn’t last long for most tenants. On the other hand, offering two bedrooms opens yourself up to more tenant types, giving space for sharers, children or a spare room/office. Two bedroom properties can often suit tenants for many years, offering space to grow into. If chosen carefully, a real bonus can be finding a flat (generally ground floor) that has its own outside space, which is almost as good as living in a house in the tenants’ eyes.

One important aspect to consider, whether the flat has one or two bedrooms, is location. The two best areas I’ve found for flats in Chichester are those close to the city centre or near to St Richards Hospital. Flats are less frequently requested in the more family-orientated areas of Chichester, such as Parklands, where larger family houses tend to be preferred.

With a budget of £180,000, this particular landlord could make the decision to invest in a ‘nice’ one bedroom flat or a ‘low-end’ two bedroom apartment. This would have a bearing on the type of tenants likely to rent the property, which may also be something to consider. The ‘low-end’ stock tends not to increase in value as much as the ‘nice’ properties either.

If you’re looking at investing in buy-to-let and would like a second opinion on the options available to you, please get in touch.

(This article was featured in the Chichester Observer's property section 

on 15th October 2015).

Clive Janes, CRJ Lettings.  

www.crjlettings.co.uk

___________________________________

If you are looking for an agent that is well-established, professional and communicative in Chichester, then contact us to find out how we can get the best out of your investment property.

E-mail me on clive@crjlettings.co.uk or call 01243 624 599.

Don't forget to visit the links below to view my previous buy-to-let deals and Chichester Property News articles:

Follow The Buy-To-Let Property Investment Market in Chichester

Chichester Property Market LinkedIn Page for Clive Janes

CRJ Letting Agents Chichester Facebook Page

CRJ Letting Agents Chichester Twitter Page

Chichester Investment Property Management Specialist CRJ Letting Agents Website

__________________________________