On the face of it, the answer to this question may seem like a simple one. Larger properties tend to see greater capital appreciation than their smaller counterparts, so the answer is houses right? Well not always. Property markets each have their own unique characteristics and in some, flats are a rarity which means they’re snapped up. The reverse can also be true.
Houses outsell apartments by 4:1 across the UK, with houses taking up 80 per cent of the sales compared to apartments’ 20 per cent. The average price of a house in England and Wales is £293,000 and the average apartment price is £302,000. This might sound the wrong way around but flats are generally found in urban areas where land values are higher.
However, when looking at the relative merits of flats and houses in Chorlton and Old Trafford, we have to look at relative capital inflation in the long run. Over the last ten years, the total rate of price growth for flats has been 27.9 per cent in the local area and prices now sit at £148,400. This compares with 64 per cent for houses which have an average sold price of £324,100.
There are benefits to investing in a house: you don’t have to pay service fees or ground rent, meaning you can save hundreds of pounds each year. They also negate the need to deal with a freeholder, and you don’t have to worry about renewing leases on buildings. There is also the argument it is harder to add value to apartments because of space restrictions and building rules. Apartments, however, are often cheaper than homes and will command higher yields if your are thinking of renting.
A buy-to-let investor will have to weigh up which is the most valuable investment property for them, taking into account yields and long-term gains. Many renters are young professionals and their budget will often be more suitable for an apartment. They prefer to live closer to the centre of towns and cities, which means accommodation near transport and amenities would be the better investment. That isn’t to say there aren’t other types of renters, and with 48.2 per cent of the local area consisting of families, there are still rental options for houses.
So as you can see, the winner in Chorlton and Old Trafford is houses in the sense that their growth rate over the last decade has been the greater. However, whatever type of house you are selling, it will always do very well in our market if you’re working with a local expert. If you have any questions relating to property in the local area, please don’t hesitate to get in touch with us on 0161 882 2233.