What is the best type of property to invest in for Buy To Let ?

[Ricky Bhurji]

Hi All,

Having been an Investment agent for over 10 years I've seen Investors buying lots of different types of properties for investment -

The first thought is should I buy: Studios, cluster houses, maisonettes, high rise apartments, flats in small blocks, terraces, semi detached, detached ?

The second thought is how many bedrooms: 1 beds (single person/young couple) 2 beds (couples and small families),3 beds (larger families in good school catchment areas),4 bedrooms (targeting sharers/students) ?

The correct answer to the above is of course dependent on your budget but it also has to be apart of your strategy as to who your target audience will be!
Each area is different and therefore has different demographics and demand from tenants.

If I had to generalise and put the type of property where you see the most consistent demand, and largely recession proof (they're not building many more of them),then the Top 3 would be:

1. Terraced property
2. Semi detached property
3. High rise apartments

Terraced property because they are mass-market, independent and have gardens often which people like.
Semi detached because they are totally catering for family lets, particularly in popular schooling locations and they offer better parking than terraces.
High rise apartments because they are often very centrally located to a town, close to mainline stations and therefore highly lettable. If you can buy one with an "edge" i.e. bigger square footages, with parking and/or a balcony - they're often a safe bet!

I'd be keen to hear other peoples opinions and experiences.

Ricky Bhurji.

 

[PropEx]

It wouldn't bother me what kind of property it was, I would always look at the yield and what the vacancy rates are in the area. I think they are far more important.

 

[Ricky Bhurji]

Hi PropEx - is it all just about yield? What about buying a property as a safe haven/ or a better location to factor in some capital appreciation? Investors who chase yields often own a lot of property in ex-council areas!

 

[PropEx]

Hi PropEx - is it all just about yield? What about buying a property as a safe haven/ or a better location to factor in some capital appreciation? Investors who chase yields often own a lot of property in ex-council areas!

I generally don't keep properties for that long and as I stated on another thread that I generally buy in America at about 70% discount of what the price was before the crash, so I do not badly on capital appreciation. There is no such thing as a safe haven in investments, so no, I wouldn't buy one as a safe haven. I look at figures and figures only, so I couldn't care less if it is a condo, a semi detached, a detached or a caravan. I don't get emotionally attached to my investments, if figures tell me to buy, I buy, if they tell me to sell, I sell.

 

[nmb]

I think it can be dangerous to pigeonhole yourself to one particular type of buy to let property and, as others have suggested, it should really come down to the facts and figures. What is the yield? What is the potential for capital growth?

 

[propertyvalues]

It doesn't matter what type of property you purchase for buy to let. It's all down to yield. Income. Like any other investment decision, if you are banking on capital appreciation and have little concern for yield, then your decision is speculation. The higher the yield, the less downside risk. The lower the yield the greater the risk. This is simple 101 investment fundamentals regardless of asset class.