Please help me choose a flat in London: 1 bed ex-council flat in Camden, London or 2 bed new build in Ware, Herts

[ldnflatbuyer2021]

Hi,

I am starting to go insane trying to make one of bigger decisions in my life !

I will be staying in London for at least 2-4 years - and will either sell the flat or keep it rented while likely moving abroad or renting somewhere else.
So basically my most important thing is trying to keep value for at least the short-term (next 2-3 years) !

After a lot of viewings, my two main options are:

1. Ex-council 1 bed flat in central Camden (small, well maintained block) - £385 000

PROs:

• excellent, excellent location
• seems like flats in this development have sold previously for much higher prices meaning this is a good price point - also compared to other nearby properties
• low ground rent / service charges
• lively area with lost of things to do

CONs:

• whilst good sized overall (>45 sq.m.), it's still somewhat small for more than 2 adults and one very small baby
• needs a lease extension soon (likely costing £10k in total)
• council as leaseholder - which can supposedly be problematic with big repairs
• half of other flats are council tenants
• I don't know if the city center exodus has stopped or will keep going?

2. Newish build 2 bed flat in Ware, Hertfordshire (smaller block) - £315 000

PROs:

• everything is new
• allocated parking - which you could perhaps rent out
• very high demand in the area at the moment due to everyone moving to suburbs
• about 40% cheaper per sq.m. than the 1 bed flat in Camden

CONs:

• ground rent increase every 5 years with RPI - will go over £250
• bad management company - all bad reviews, relatively high service charge for such a new block
• bad lease terms such as restrictions like no dogs, license to have a cat
• flat could be of shoddy quality, I've seen issues with it mentioned by others

I'd go with the Camden flat if it were me, particularly if you intend to hold it as a long-term investment.

In favour of the Ware flat though, I would hope a high service charge means the block will be well maintained, and I think managing companies always get bad reviews, it's one of those situations where people only ever review if its with a complaint. Re license restrictions, those are also in place to protect you. If you move to the Camden flat, and a neighbour has a dog who won't stop barking it will be difficult to rectify the issue whereas I would expect in the Ware flat they could withdraw the licence.

It depends a lot on how you like to live. Do you like being close to the heart of the city, with all its facilities on your doorstep, and without needing to worry about transport. Or would you rather be somewhere quieter and closer to countryside? I think those are the main factors rather than the things you've listed.

@mobear

I'd go with the Camden flat if it were me, particularly if you intend to hold it as a long-term investment.

In favour of the Ware flat though, I would hope a high service charge means the block will be well maintained, and I think managing companies always get bad reviews, it's one of those situations where people only ever review if its with a complaint. Re license restrictions, those are also in place to protect you. If you move to the Camden flat, and a neighbour has a dog who won't stop barking it will be difficult to rectify the issue whereas I would expect in the Ware flat they could withdraw the licence.

Thank you - I agree with the license - though I might want to have a dog which is completely banned in such new builds.

I was wondering, why do you think Camden will be better?
Is it because there is less space where you can build?

I know the prices for new builds in Ware haven't shot up like for example houses did (houses rose at least 10-15% over the last year...).

Camden one for me. Easy decision.

@ldnflatbuyer2021m New builds tend not to appreciate in value as well as old housing stock, and you'd need to really lock down whether there were any cladding issues. London prices seem to achieve the best long-term gains. It's true, property prices have shot up outside London recently, but that's because people want more space and a garden, and I'm assuming the Ware flat doesn't have a garden? I also think this will cool off once the reality sets in that most people are going to be expected back in the office.

It's a separate point but if you're thinking about moving country I would seriously look into the ins and outs of relocating a dog. It's not necessarily cheap or easy (but depends on the country you're going to of course).

Well lots to think about and I am sure there are other options, ie there will be 2/3 bed ex council flats in hertfordshire also (probably with a garden).
As you have a baby I would want to consider local schools as your plans may change. Where would your heart be countryside or inner london? Where are your friends?
I wouldn't buy a newish build when you know the management company is bad and the service charge will rise to over £250.
With the risk of a possible large repair bill from the council in the council flat would you be able to raise that money if you did need to?
I am in an ex council house so I wouldn't rule out ex council personally, you get more for your money.

@Mixingvax

Oh dear what a shame the ex COUNCiIL flat still has council tenants living there god forbid they managed to hang onto what social housing is left.

Such a entitled snobbish view op I would look at your prejudices!

(From someone who grew up in Camden in a council flat)

Hi, I don't necessarily have issues with that, I've lived in flats my whole life - but it would be better in terms of value if you had all private leaseholders in the building - so you could even enfranchise and get rid of council freeholder. Also there is a stigma overall about council estates - which I do understand for large blocks with deck access as they sometimes look grim...

I'd be worried about the increase in ground rent every five years in the Ware property.

If you’re open to ex-local authority low-rise blocks then surely you could get a 2-bed if you look a bit further out than Camden? So I say neither, but particularly not option 2. I don’t like the sound of all those leasehold conditions and I’m not a new build fan.

@AlfonsoTheMango

I'd be worried about the increase in ground rent every five years in the Ware property.

It is concerning - this is perhaps why it's being sold for a bit less than when originally bought. It's a pretty high ground rent (£250 now) but grows with RPI every so often.

The biggest issue really is once you need to extend a lease or so - I imagine it will be quite expensive.

I wouldn't personally be buying a flat & assuming it will it hold its value for 2-3 yrs.

Can you look at small houses in Hertfordshire?

@SimonedeBeauvoirscat

If you’re open to ex-local authority low-rise blocks then surely you could get a 2-bed if you look a bit further out than Camden? So I say neither, but particularly not option 2. I don’t like the sound of all those leasehold conditions and I’m not a new build fan.

This one is in a nice block, very good location close to Camden town, only 4-8 flats per block with also 3 storeys.

- seems like flats in this development have sold previously for much higher prices meaning this is a good price point - also compared to other nearby properties

why is this one cheaper now?

It is concerning - this is perhaps why it's being sold for a bit less than when originally bought.

and this flat has has already lost value?

I'd go for the flat. The new build management issue and ground rent could end up making this one virtually unsellable.

Most ex-council flats are very well built if they're not too recent.

There is a lot in-between those two options.

I am a bit concerned with how slow/weak the market for 1 bed flats in Camden is compared to 2 beds in Hertfordshire.

Like 1/3 of these flats in Camden are sold STC in Rightmove, whilst in Ware it's 2/3 of all flats.

Camden. Easier commute - maybe even walk to work? More fun. I imagine it will be easier to rent out.

@gibletjane

- seems like flats in this development have sold previously for much higher prices meaning this is a good price point - also compared to other nearby properties

why is this one cheaper now?

It is concerning - this is perhaps why it's being sold for a bit less than when originally bought.

and this flat has has already lost value?

1. I think because it is in central zone 2 in Camden (very central), the current demand seems very weak for 1 beds

2. the new build in Ware already lost value compared to sales price - so I think the onerous lease/ground rent are "priced" in

I think the best thing to do is buy what suits you but just don't assume you will make money. How much have either flat increased by in the last 2 yrs?

@urbanbuddha

Camden. Easier commute - maybe even walk to work? More fun. I imagine it will be easier to rent out.

Actually, from looking into it, at the moment it's super hard to get anything to rent in commuter towns - at least in Ware. Properties stay on the market for just a couple of days.

Whilst in Camden, at the moment, you can even negotiate down and etc.

Personally I can't see demand increasing rapidly for the Camden one in 2 yrs. And if the Ware one has lost value again i'm not sure why it would go up.

I would 100% pick the Camden flat except for the council aspectthere is a potential to be hit with some really big bills here, especially if it's 50% council (who will likely not have to pay any share of the bill). However now is a good time to buy a flat like this, they will be at their cheapest and it will be super easy to rent outyou can Air BnB, student rental, professional rental no problem. Plus it would be a far nicer place to live

Location, location, location. Taking everything else out of the equation, where would you rather live? There's a huge difference between Camden and Ware, they're like chalk and cheese. For me, it would 100% be Camden, but where do you want to live?