Q I bought an apartment in a well-known city centre development for investment purposes about 18 months ago. I am now considering selling it, but concerned that I will not get the capital appreciation that I was hoping for. What are your thoughts on this? John Griffiths, Stratford
Isabelle Wright answers: The apartment market remains competitive in Birmingham with a number of apartments available. The pace of this development has continued unabated and competition in the market place continues to increase. As such purchasers have a wide variety of choice on offer to them and have realised their buying power. This situation has not meant however, that investors are not able to achieve capital appreciation, it has simply enforced a more realistic strategy. When the apartments are brought back to the re-sale market, vendors, whether they are investors like yourself, or owner-occupiers have realised that they are far better to accept a small profit and achieve a quick sale, rather than hold out for huge profits and be on the market for some time. I have seen many people make a 'healthy' profit out of their investment, but it is where they are realistic with their expectations. The continued development of apartments has flooded the market, but this is counteracted by steady demand. I would recommend that you carefully consider the price at which you are prepared to re-sell and research the direct competition to you in both the same development and similar schemes.
Q I am purchasing an apartment in Birmingham for myself to live in; however I may re-sell it in a couple of years. I therefore want to make the right choice investment wise and had thought that a loft apartment would be a 'good bet'. What are your comments on this? James Sutton, Coleshill
Isabelle Wright comments: There are few 'loft style' developments in Birmingham, compared to other cities in the UK. It is a clever move to focus your search on such an apartment. As you will see from my comments above, the Birmingham apartment market remains competitive. One way of bypassing this and often creating competition between buyers is to offer an apartment that provides something different - the 'X' factor. Loft apartments do in fact sell well due to the fact that the accommodation is not only unique, but it is usually spacious and light. As such they appeal to a number of purchasers and do not tend to stay on the market long.
Q I am considering purchasing an apartment and will be moving from a freehold house in Moseley. One concern I have is about the service charge and differing levels between developments. What are your comments on this? Vijay Patel, Moseley
Isabelle Wright comments: In terms of the differing levels of service charge, this will simply be dependant upon what facilities are on offer at the development and its location. For instance you would expect to pay more for a development that provides 24-hour concierge, communal courtyard/gardens, gymnasium, lifts etc than one without any of this. Similarly a development located in the city centre is likely to command a higher service charge than one in a suburb. I would therefore recommend that you carefully consider what facilities are important to you, the location that you would like to be in and the subsequent service charge that you are prepared to pay.
