Written by CIA Agency  |  25th March 2021

Which Semi-Detached House should I
buy in the City of Westminster?

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I got asked a question at some-point last week and the question was, which Semi-Detached House should I buy in the City of Westminster?

Furthermore, one of our landlords asked if they should buy a Leasehold or a Freehold Semi-Detached property to rent out to tenants or keep to sell at a later stage in life, within certain 1-mile radius parameters.

The first question that I asked them was, what are they looking for from this investment? Is it capital growth in the property or to purely to gain great yield investments?

What is property capital growth?

The dictionary definition of capital growth is: Profit made on an investment or purchase of an asset, measured by the increase in its market value over the invested amount or cost price. Also called capital appreciation.

What is rental property yield?

Rental yields signify the rate of return from an investment. Estate and letting agents, such as CIA, will often include the expected gross rental yield on investment properties being marketed.

The reasons why I asked these questions is purely to give our Landlord the most suitable answer based on specific data analysis and filtering the Local Real Estate Market for the most profitable investment.                    

Sales of freehold, semi-detached properties around the City of Westminster had an overall average price of £4,075,672 over the last year (2020/ 2021). Overall, sold prices for freehold, semi-detached properties around City of Westminster over the last year were 26% down on the 2012 peak of £5,475,000.

Sales of leasehold, semi-detached properties around City of Westminster had an overall average price of £1,840,457 over the last year (2020/ 2021). Overall, sold prices for leasehold, semi-detached properties around City of Westminster over the last year were 58% down on the 2013 peak of £4,350,000.

The overall average price of a Freehold Property was £4,075,672 over the last year (2020/ 2021), but the mean-average price was calculated on 76 Sold Property Ratio and this was examined on a 1-mile Radius from the Heart of Westminster.

The overall average price of a Leasehold Property was £1,840,457 over the last year (2020/ 2021), but the mean-average price was calculated on 9 Sold Property Ratio and this was examined on a 1-mile Radius from the Heart of Westminster.  

The 1st examination was the Mean Average Rent PCM for a 1-Bedroom Semi-Detached property and the figure is £1408.33.

rent per month per number of bedrooms

The 2nd examination was the Mean Average Rent PCM for a 2-Bedroom Semi-Detached property and the figure is £2369.50.

rent per month per number of bedrooms

The 3rd examination was the Mean Average Rent PCM for a 3-Bedroom Semi-Detached property and the figure is £3750.20. 

rent per month per number of bedrooms

The 4th examination was the Mean Average Rent PCM for a 4-Bedroom Semi-Detached property and the figure is £10622.71. 

rent per month per number of bedrooms

The 5th examination was the Mean Average Rent PCM for a 5-Bedroom Semi-Detached property and the figure is £25133.33. 

rent per month per number of bedrooms

The 6th examination was the Mean Average Rent PCM for a 6-Bedroom Semi-Detached property and the figure is £9950. 

rent per month per number of bedrooms

The 7th examination was the Mean Average Rent PCM for all 25 properties ranging from 1 to 6-Bedroom Semi-Detached property and the figure is £8482.52. 

rent per month per number of bedrooms

The conclusion in Buying into a Freehold property VS Leasehold property may come over as a clear answer due to the fact the Freehold property have sold 8.4x more than the average Leasehold property. Which in the eyes of an investor this comes across as a lucrative proposition?

However, there are far more factors to take into consideration before coming to a single conclusion and at CIA we are happy to discuss this with you in further detail.

Another Mean Average test was examined against 6 variations of bedroom number(s) in comparison to find the Mid-Value of Rent PCM depending the room Numbers and the 1-mile Radius parameter. We examined this data against 25 Random Semi-Detached properties for last year (2020/ 2021)

The conclusion in buying a Semi-Detached property in the City of Westminster to rent out largely depends on a number of varying parameters such as; exact location, specifications of the property, size of the garden, size of the bedrooms, number of bedrooms and the list is endless.

Based on my statistical analysis of the above data for the last year (2020/ 2021). It is rather clear that a 5-BR (Bedroom Property) wins the race of the highest yield and the figure is £25133.33 PCM. In contrast the 1-BR falls in last place failing to exceed to the £2,000+ mark PCM. Which in the eyes of an investor this comes across as a highly lucrative proposition? Yet again, there are far more factors to take into consideration before coming to a single conclusion and at CIA we are happy to discuss this with you in further detail.

Should you require further information please Contact Us, and CIA will do their best to help you with your enquiry.