Thursday 7 May 2015

One bedroom flats in Chelmsford, are they good investments?

There are nearly 1,200 flats in Chelmsford. This represents around 5.5% of the housing stock here, reasonably close to the national average being 17.5%. The average price of flats with one bedrooms in Chelmsford is currently around £132,000, which surprisingly is 14% higher than 12 months ago. Bearing in mind that Chelmsford prices generally have increased by just over 8% year on year, this is a great result

At the moment, you can buy a one bedroom flat in ‘The Village’, which is a development off of Writtle Road, for a very reasonable £135,000. You would be looking to achieve around £675 per month in rent for this type of property, which means that the gross yield could reach around 6% per year. However, you must remember that services charges & ground rent may apply when buying an apartment, due to them being leasehold and every landlord’s tax and interest rates are different, so it is essential to research your investment carefully before committing.

Finally, let’s not forget about the potential increase in capital value of the property. I was looking at the one bedroom flats in the Chelmer Village area and found that they were selling in the region of £66,500 in 2001. Within 5 years in 2006, the value had jumped to £118,000, a 43% increase. The values had increased again by another 10% to around £130,000 at the tail end of 2014. There is nothing to say that we shouldn’t see similar growth in the future.

If you would like some advice about what could make a good investment, please visit our office on Duke Street.

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