One bedroom flats in Penicuik, are they good investments?

I was out for my lunch the other day in Penicuik when somebody stopped me to ask about the Penicuik property market .... a common and delightful occurrence for the author of the Penicuik Property Blog! 

The discussion this time was about whether one bedroom flats in Peniciuik make good buy to let investments. We had a good chat about this, both in the street and further in my office in Bank Street.

There are around 1,166 flats in Penicuik. This only represents around 17.6% of the housing stock here, with the national average being nearer 36.4%. The average price of flats in Penicuik is around £119,400, which is nearly 2% lower than 12 months ago.

You can buy a one bedroom flat in the centre of Penicuik, for a reasonable £85-90,000.  With a 75% mortgage, a landlord would only need to put down a £21-23,000 deposit to get the property.  These sort of one bedroom flats could achieve around £525 per month in rent giving a gross yield of around 7% per year on the purchase price. However, you must remember that every landlord’s tax and interest rates are different, so it is essential to research your investment carefully before committing.

Finally, let’s not forget about the potential increase in capital value of the property. I was looking at the one bedroom flats in John Street and found that they have sold for around £40,000 in the early 2000.  This had grown by 2.5 times at the height of the property boom in 2008 to around £100.000. The values have now dropped down to an average nearer £80-850,000 which is still more than double the early 2000 levels, but that is not to say we couldn’t see similar growth in the future.

If you would like some advice about what could make a good investment, please visit our offices at Bank Street .... or just catch me when I am out an about the streets of Penicuik, I am always delighted to chat!