Currently in Chelmsford, the average rent for a one bed property is around £749per month with an average value of £184,683. This means an approximate return/yield of 4.8% per year. This is of course, the average.
There are one bed apartments on the market for rent at a higher price than some two bed apartments. In fact, some one bed apartments in Chemsford can attract rents in the mid £800's whilst some converted terraced houses with flats in them can be rented for as little as £550 per month. This means yields on one beds can range between 3.5% and 5.5% (approximately).
Two bed apartments in Chelmsford can be priced anywhere between £350,000 in one of those modern City Centre developments and as low as £150,000 in the Springfield area. Again, rents can be quite varied, ranging from over £1300 per month for some luxury City centre apartments in Chelmsford to £700 per month in Broomfield or around Springfield. However, looking at the average rent for a two bed apartment in Chelmsford, I calculate it to be £959 per month with the average value being £252,171 which gives a return/yield of 4.5% per year.
Whilst the difference in the yields should be taken into account, it is only one of many factors you should consider before buying a property. Whilst two bedrooms are more expensive to buy, they will always let better. Do they sell better? Well, 50% of the two bed apartments on the market in Chelmsford at this moment in time are sold subject to contract compared to 52% of 1 bed apartments . so not much difference there.
It really comes down to the property and type of tenant. Two beds attract small families and professional sharers, which bring both advantages and disadvantages to the landlord, but one beds have better yields, although with a one bed you tend to get a higher turnover of tenant.
It depends what you want from your investment. I know the lettings market in Chelmsford so I can advise you what you can expect to achieve in rent and how it go up in value together. If you would like any advice on choosing properties, come and see us at our office on Duke Street.