Larkspur Close vs Kestrel View

Larkspur Close vs Kestrel View

I was talking to a couple who popped by the office yesterday who are looking at investment properties in the area.  They brought in details of two properties, a two bed in Kestrel View and the same in Larkspur Close and asked me my view on which would make the better investment.  Which would offer a better return/yield?  

Now both streets let well but I decided to do a little research to help them with their decision.

The average asking price on a property in Larkspur Close stands at £160,000 whilst on Kestrel View  it is currently  24% lower at £139,000.   To fully understand the investment opportunities available, I considered the average rents currently payable in each street.

Currently a two bed terrace house on Larkspur Close will rent for around £700 giving around 5.25% return whilst the same on Kestrel View will return around £650 showing around 5.41%- not a lot of difference.

However when we consider capital growth over the last 5 years the properties in Kestrel View have appreciated nearly 20% more than those  in Larkspur Close.  

So it comes down to that old chestnut, yield or capital growth!  Assuming both properties were in lettable  condition  I would suggest that you would be better investing your money in Kestrel View because although the yields are similar the capital growth is significantly greater and the original purchase price would be much less.

If you would like any more information on investing in Weymouth’s property market please call me on 01305 775504 or visit our office at the top of St Thomas Street.