Date Published 15 February 2016
This week, as a favour to an emailed request I received from a very enthusiastic reader of our blog, who suggested that they feel news of 4 bedroom properties has been very scarce recently; they would like to read more about the current state of these properties, in regards to the Marylebone market. I myself certainly could relate to this request as generally the most popular and most available properties on the market in Marylebone include: 1, 2 or 3 bedrooms; talk and indeed the availability of 4 bedroom properties (in comparison) have been less common. Perhaps the cause also stems from 4 bedroom properties generally possessing much higher asking prices or even out of a presumed feeling that 4 bedroom properties aren`t as efficient Buy-to-Let investments – well let`s find out! Let`s explore whether we should be talking about 4 bedroom properties with greater vigour as well as appeal, and if the prices associated with 4 bedroom properties are worth the jump. I will be using 4 streets across Marylebone of a mixed repute and popularity, which feature 4 bedroom properties (houses & flats) and we will examine how the average asking prices, the achievable rental values as well as the potential rental yields that can be generated resultantly, currently fare in the present market. I will then compare these examples of the 4 bedroom property market, with that of its closest competitor: 3 bedroom properties – 3 bedroom vs. 4 bedroom properties for each chosen street, how closely do they compare?!
Knox Street (W1H)
Average Value of 4 Bedroom Properties: £3,074,800 - Average Rental Value: £8,320 (pcm) - Potential Rental Yield: 3.24%
Average Value of 3 Bedroom Properties: £2,130,500 - Average Rental Value: £5,775 (pcm) - Potential Rental Yield: 3.25%
Cato Street (W1H)
Average Value of 4 Bedroom Properties: £2,721,500 - Average Rental Value: £7,875 (pcm) - Potential Rental Yield: 3.47%
Average Value of 3 Bedroom Properties: £2,440,000 - Average Rental Value: £6,625 (pcm) - Potential Rental Yield: 3.25%
Mansfield Street (W1G)
Average Value of 4 Bedroom Properties: £5,357,200 - Average Rental Value: £15,030 (pcm) - Potential Rental Yield: 3.36%
Average Value of 3 Bedroom Properties: £4,090,250 - Average Rental Value: £10,407 (pcm) - Potential Rental Yield: 3.05%
Chiltern Street (W1U)
Average Value of 4 Bedroom Properties: £2,296,250 - Average Rental Value: £6,650 (pcm) - Potential Rental Yield: 3.47%
Average Value of 3 Bedroom Properties: £2,130,700 - Average Rental Value: £6,040 (pcm) - Potential Rental Yield: 3.40%
From our results, this selection of various streets show us that the financial rewards of both 3 bedroom as well as 4 bedroom properties are very closely intertwined. 4 bedroom properties are indeed shown to possess very good investment potential (especially rental potential), where in these instances 4 bedroom properties have outperformed 3 bedroom properties in terms of the prospective rental yields that can be generated. However, on Knox Street, 3 bedroom properties are shown to minimally edge their 4 bedroom competition and this consequently shows that Marylebone streets differ greatly, in terms of their investment potential. Also we see that preferences in property types can be fulfilled and connected with individual financial circumstances – there are 3 bedroom or 4 bedroom properties at the right price and at a good rental yield in certain areas, compared to other areas, you just have to match the right area to the correct property type and you`re in business! Moreover, in all 4 instances we illustrated that 3 bedroom properties are, perhaps more obviously, but nonetheless importantly, shown to be cheaper than 4 bedroom properties by an average of £664,575; this is a substantial difference in price and shows that choosing between the two property types is also greatly affected by one`s financial budget. The fact that the prospective rental yields of both 3 as well as 4 bedroom properties, when combined, average out to a healthy 3.31% annually expresses that they both have a great long term investment potential. A choice between them would generally be decided by the individual`s financial circumstances, but whichever path you take you can rest assured that an investment with either a 3 bedroom property or a jump to a 4 bedroom property would undoubtedly reap you remarkable financial returns!
Lastly, let me absolve you from any potential predicaments by informing you that, I am always available for contact should you need any further advice, regarding 4 bedroom properties in Marylebone generally or even if you have a specific property presently in mind.