Studio Apartments - Good Buy-to-Let Investments?

Studio Apartments can split a crowd of property experts; while all acknowledge they can be a good investment, some would say a one or two bed would be favourable. Here at the Heaton Group, we firmly believe that a cleverly designed, well located Studio apartment in the North west can punch above its size as a buy-to-let opportunity.

What to look out for when considering studios

Good Design

Built in Storage: Floor space is at a premium in a studio and it may be difficult for a tenant to fit in a wardrobe etc. Look out for built in storage that provides a solution to this problem
Light: Ensure that the living space is light and airy, making the studio feel larger and liveable
Separated Bedroom: Studios with a divide between living and sleeping areas will be more appealing to tenants; after all, who wants to sleep in the kitchen? Here at the Heaton Group, we cleverly divide the living and sleeping spaces with the en-suite and storage to provide clearly defined areas

Affordability & Demand for Tenants

Affordability: Overall, studios are aimed at tenants with budget in mind - ensure that the proposed rent per calendar month is affordable for the location
Demand: How many other studios are there for sale in the area? Will your property be filling a gap in the market or is the market flooded with similar studios? Our studios are often the soonest to rent as demand tends to be greatest at the “cheaper” end of the market

Good, Long Term Investment Opportunity

Yield: Studios should earn a higher yield than their one and two bed counterparts
Capital Growth: Capital growth is usually a little slower with a studio apartment, so bear in mind that a studio should be considered as a longer-term investment
Maintenance costs: Studio apartments tend to attract a more transient tenant, who tend to rent for around 12 months. This can lead to more wear and tear, and higher maintenance costs – however this is balanced by the space being smaller and cheaper to maintain

Every investment decision must start with your goals and financial situation. Determine what you can afford to buy and then from there, develop a property strategy – remember to include Studio Apartments in your plan!