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Is it best to buy a buy to let property in a better area or cheaper area?

Capital growth over yield

Asked on Mar 21 2014, Renting in Chelmsford | Report content

Answers (1)

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  • Hi susan, This will all depend on your long term goal with regards to your investment. Prices are starting to pick up across the UK at the moment, and are expected to do so repeatedly for around the next four to five years. And with job opportunities and the general financial health of Brits at last starting to improve, it means that demand and appetite for buying properties will remain high and potentially get even stronger in the next few years. What this means, of course, is that your chance of capital gains in the better areas within a relatively short space of time is actually quite strong. On the other hand, the UK rental market is still showing real signs of strength at the moment. Countrywide said that at the end of 2013 there were ten tenants chasing every home that came to the market, which means that many landlords are capitalising on high demand to push prices higher. If you are buying in a cheaper area, this can be particularly advantageous, as letting out the property in the current climate will allow you a high rental yield in relation to what you have spent on buying the home in the first place. Many thanks, Scott

    Answered on Mar 25 2014, Report content

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