As a property investor you'll probably have a preference for old or new homes already. But regardless of where you stand, today we show you some of the reasons why older properties are worth considering. Initially they may require a bit more TLC, but in the long run you may find the effort is financially beneficial.
More outside space
You’re more likely to find an older property with a garden in London, as many of the capital’s contemporary homes are built upwards. While you may get a balcony or a terrace in a new build, a lot of period houses and flats come with a garden, which is great news given the added value an outside space can bring.
In some newer developments, you may find that a small number of properties have outside space. However, you will certainly pay a high premium for this.
Fewer added costs
When developers build apartment blocks, this will usually be on newly acquired land, which can be extremely expensive – especially in more central parts of London. This means that a premium will usually be added to the price of the properties in order to cover these costs. You will also be contributing towards things like the developer’s profits and all the advertising spend that goes into marketing a development, which you won’t get with an older property.
Add more value
Older properties may be prone to damp and the interiors may not be super modern, but you’re more likely to have space at the back or side of the property to extend, meaning there is greater potential to add value than in a newer property.
Adding an extension doesn’t have to be really expensive and the return on your investment can be worth the effort. And sometimes just replacing an outdated kitchen or bathroom can add more value to the property than the amount you spend having to do it.
There may even be potential to add value to properties built just 15-20 years ago. So you don’t necessarily need to opt for a Victorian or Edwardian property to see a greater return on your investment, as any improvements may cause immediate uplift in value – which is difficult in a new home.
Get more space for your money
Homes built more than 100 years ago are often known for having bigger proportions than new builds. In London, the majority of Victorian and Edwardian stock was built for the growing middle classes, which means a lot of period properties have good ceiling heights, larger rooms and a greater feeling of space. However, their layout isn’t as open as modern properties, which give the impression of a larger space.
Learn more about the differences in an Edwardian house vs Victorian.
Lower service charges
A lot of contemporary apartments can be found in developments with facilities like gyms, pools and communal lounges. But while these are luxurious extras, this can make the service charge high. If you’re a buyer who intends to live in the property, then you might be happy to pay the charges.
However, if you’re a landlord then you would need to consider if you will pass these charges onto your tenant, otherwise you might be paying a high service charge when you’re not benefiting from access to the facilities yourself.
If you own a property in an older building with shared spaces, you will usually have to pay a service charge to the freeholder to maintain these areas. However, this is likely to be much lower than in a modern development.
