SMF - Just Installed!

2bed Vs 3 bed flat - advice please

Started by RussB, July 01, 2020, 10:17:55 PM

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RussB

Hi all! Just hoping for a little advice or even a 'what you would do not his situation' approach.

I'm a relatively new landlord and getting my second property, so I have zero experience with decisions like this. Property is in Leeds city center.

Was about to jump in on a 2 bed (new build) for 220k. Before pulling the trigger though there is a 3 bed in the same complex built in an earlier phase, it's a 3 bed duplex with an extra parking space. It's 240k so 20k extra. The purchase price isn't an issue. In terms of rent, I could rent the 2/3 bed for 100-200 more pcm.

I'm as concerned about capital growth as I am yield,

Targeted Tennant in Leeds would be young proffesionals from what I've researched and spoken to local agents about, but also a healthy variation to that.

So my question is which one would you go for? Which one would be more likely to bring better net income?, i.e. longer lasting Tennants, less void periods etc

Additional information. 2 bed flat is on a 6th floor with a lift. 3 bed duplex flat is on the 3rd floor but no lift. 3 bed has a better/bigger living room. 3 bed had a Tennant already, 2 bed is brand new.
In my head the 3 bed is batter 'value', but given that a 3rd floor 3 bed doesn't exactly suit a family, is that 3rd bedroom pointless and most Tennant's wouldnt care/pay more for?

Any advice is appreciated just o help me make a choice... Thanks

R

Hippogriff

2 bed... for all the obvious reasons.

heavykarma

Are these leasehold? Personally I would never buy a leasehold again,knowing what I know now.All things being equal,I would go for the 2 bed.

Hippogriff

Oh Heavykarma... "neither" wasn't really one of the choices. You've gone above and beyond... gold starz for you (I'll get them added to your forum profile). I agree 100%. I wouldn't do it again either. I also worry about any Service Charges and any nasty clauses regarding Ground Rent. One assumes that all comes out in the conveyancing wash if not known already. I was succinct because I was still trying to figure out what a "healthy variation" to "young proffesionals" might be... now I've researched that and feel comfortable with the answer... 1) don't go Leasehold... 2) don't go with anything with a Service Charge you cannot control... 3) the only good thing about flats (usually) is there's no gas boiler.... 4) young professionals are generally terrible - they fall-out, they move on, you want a less mobile family that will settle, get into the local school etc. (your less voids worry - where even people in receipt of LHA / UC are the least mobile)... 5) new build vs. quite new build is gonna be important in being able to charge a premium... 6) you don't generally want to take on any existing Tenants... 7) you seem to imply the 3rd bedroom isn't really one anyway, so why count it?... 8 ) £100 more per month for £20,000 extra outlay doesn't seem to make much sense... but 9) the extra parking space is gonna be a real boon to anyone... then 10) it's deffiantly "Tenant".

Hippogriff

"Don't talk to me about sophistication, love, I've been to Leeds!"

heavykarma

Yea well, I have been to Hull (and back)

I agree about young professionals,they are irritatingly full of confidence and ambition,and still have the ability to attract a mate/get pregnant/emigrate.You want someone who has got all that out of their system,and once they have made the huge effort to move,can't be arsed to move on again.A kind of respectable loser.It is also clear that tenants on long-term benefits are going to be like gold dust.Nothing going on in the economy or jobs market will affect their ability to cough up the rent.Never again will I turn my nose up.
I have a profile? Fingers crossed it is a flattering one?