We were talking to a landlord recently, who was considering whether a 2 bed terraced property on Alderwood Parc or a 2 bed semi on Little Oaks in Penryn would make a better buy-to-let investment. He was particularly interested in which would offer a better rental yield and was less concerned about long-term capital growth. We set about doing some research to help him with his decision.
Interestingly we found that when we started exploring the statistics, Little Oaks is the area of highest turnover in Penryn and Alderwood Parc has the second highest turnover. The average asking price of a 2 bed semi-detached property on Little Oaks is around £167,000; while on Alderwood Parc a 2 bed terraced is 7.2% less, at around £155,000. Both areas are popular for renting and, if the property is in good order, attract a good deal of interest when advertised.
We have been reviewing current properties for sale at these locations and, at the time of writing this article, there is a 2 bed terraced house at Alderwood Parc with an asking price of £150,000.
This should achieve a market rent of c. £650 pcm giving an annual gross yield of 5.2%. This property last sold in 2003 achieving a sale figure of £119,500 meaning it has increased in value by over 25.5% since then.
On Little Oaks there is a 2 bed semi-detached house - sold subject to contract - which was advertised with an asking price of £170,000. This property last sold in 1997 for £40,500 and has therefore increased in value by over 300% in 17 years. This property should achieve a rental figure in the region of £675 pcm giving an annual gross yield of 4.76%.
Ultimately, we found both estates to be good rental investments. So we advised them that if they wanted a higher short term yield, then the Alderwood Parc property would be a better bet but for long-term capital growth then the Little Oaks property would be the best option whilst also still offering a good rental yield.
If you would like our opinion on what to buy or talk letting property in general, feel free to pop in to our office on Killigrew Street or call Annabel Leach on 01326 210304. We don’t sell houses but we can help you find a good buy-to-let property.
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