It seems property investment opportunities don't come any greater in the London market than a house with a garden. Research from Marsh & Parsons showed buyers will pay at least a 20 per cent premium for outdoor space, meaning renovating a garden property could be an incredibly lucrative endeavour.
The discovery was made when comparing two properties in the same area to see the impact a garden, outside terrace or park proximity could have on price. It was observed that a one-bedroom property with a patio garden in Bayswater is GBP 75,000 more expensive than a comparable property without outdoor space. This creates a premium of around 16 per cent for a private patio.
Proximity to parks was observed to create a significant premium, though not as great as possession of a garden. In Kensington, a property with a large garden, overlooking Kensington Gardens goes on the market for around GBP 3,500,000. A similar sized flat without a garden in the same area shows a 36 per cent premium. A property in the same neighbourhood with a private patio and access to roof terrace had a six per cent yield.
Peter Rollings, chief executive officer of Marsh & Parsons, said: "In the summer months, Londoners yearn for some outdoor space and the freedom to have an external room in which to entertain. But fulfilling the dream of a countryside idyll in London comes at a premium. In such an urban area, outdoor space is both scarce and expensive."
He added that outdoor space in London makes the difference between a desirable property and one that truly has the wow factor. Homes without gardens may even struggle to sell during the summer months when the appetite for outdoor space is great. However, it isn't just gardens that have pull and research has indicated that bathrooms are a deciding factor for many buyers.
A study from PrimeLocation revealed almost 80 per cent of people looking for prime property in the UK consider the number of bathrooms to be a significant factor. Investors seek an average ratio of at least two bathrooms for every three bedrooms. In fact, almost a third of those surveyed would rule out a home if they believed it had too few bathrooms.
- Friday 12 July 2013