Expected Rental Yields in Bracknell

A good rental yield is the backbone of any property investment and naturally an end goal for many investors. If you can take advantage of a positive rental yield that delivers cash flow, you’re already well on your way to a successful property investment.

Achieving a high rental yield is largely dependent on your location. It’s vital to find an area that is filled with potential. As an investor, you should be looking for locations that you think will excite tenants, offering them something that they wouldn’t be able to find elsewhere.

Emerging locations tend to have the added benefit of affordability, which can be a critical signpost for finding higher yields. If you can find a relatively affordable, up-and-coming market that has plenty of regeneration and amenities – which positively impact your asking rents – you can find higher overall yields.

In our research, we found Bracknell to be one of these emerging locations, filled with overwhelming potential. As a major player in the UK tech industry, it’s home to nearly 500,000 jobs that consistently attract young, educated and ambitious professionals looking for somewhere quality to live.

It’s the site of a huge £770 million regeneration project that is vastly improving nearly every aspect of its retail, leisure and infrastructure sectors, building new transport links and enticing well-known brands to set up shop in the crown jewel of the skyline, The Lexicon – a £240 million retail destination that has greatly improved footfall and amenities throughout the town.

Finally, Bracknell residents can reach London in under 50 minutes by train and yet property prices are nearly 70% more expensive in the capital (£383,788 vs £653,965). As you’d imagine, this makes Bracknell an appealing prospect for both domestic and commuting workers, cementing its position in the ‘outer London Commuter Belt’ that is rapidly becoming a reality as working cultures shift.

Average Rental Yields in Bracknell

The average rental yield for Bracknell sits at around 3.98%, outperforming the national average as well as London, which averages around 3.04%.

Despite seeing price rises of 249% since 1999, Bracknell remains relatively affordable within the wider South East market, which no doubt has an impact on its above-average rental yields.

As a commuter destination it continues to represent a more valuable proposition than its neighbours while also forecasting incredible growth, both strong indicators of all-important tenant demand (as well as rising capital appreciation, which can be another major goal for investors).

During 2018, Bracknell had some of the highest price rises in the UK at 19%. Since then, the South East has been predicted to outpace the national average for growth – with an expectation it will grow around 3% each year to make up a cumulative 12% increase by 2022. This will put Bracknell at the heart of the fastest-growing region in the UK, driven by new development projects such as Princess Dock and The Lexicon.

House Prices in Bracknell vs Rental Yields
Property type	Avg. Paid Prices	Rental asking prices	Rental asking prices p.a.	Rental yield
1 beds	£211,237.00	£554.00	£6,648.00	3.15%
2 beds	£306,137.00	£1,200.00	£14,400.00	4.70%
3 beds	£419,342.00	£1,295.00	£15,540.00	3.71%
4 beds	£628,803.00	£1,782.00	£21,384.00	3.40%

Source: https://www.zoopla.co.uk/market/bracknell/?q=Bracknell%2C%20Berkshire

Flat Prices in Bracknell vs Rental Yields
Property type	Avg. Paid Prices	Rental asking prices	Rental asking prices p.a.	Rental yield
1 beds	£205,508.00	£815.00	£9,780.00	4.76%
2 beds	£275,540.00	£1,103.00	£13,236.00	4.80%
3 beds	£442,273.00	£1,148.00	£13,776.00	3.11%

Source: https://www.zoopla.co.uk/market/bracknell/?q=Bracknell%2C%20Berkshire

Best Property Type in Bracknell?

The best property type in Bracknell according to our research appears to be two-bedroom apartments.

Research by Upad has shown that the number of bedrooms available definitely has an effect on the best property for rental yields, as does the property type itself.

By taking into account the average asking price of various flat sizes as well as looking at average asking rents, we can identify the best properties for rental yields. With this in mind, we’ve found that the optimal property for maximising rental yields is a two-bedroom apartment, closely followed by a one-bedroom apartment and then three-bedroom apartment.

What Will Affect Your Rental Yield?

Several elements can affect your rental yield – before, during and after the investment.

Supply and demand arguably plays the biggest part, alongside the location itself. With the right preparation, investors can quickly identify markets that are forecasting consistent demand and from that, determine whether yields could rise. The best way to do this? Research future development pipelines – residential, commercial and public – to see whether demand can be met.

Currently, in many cases across UK cities, residential supply is low although the amenities that residents want are still being created. This is ideal for investors as low supply, high demand almost always leads to rising prices and asking rents.

Similarly, the standard of career opportunities available can positively impact demand from workers in the area and contribute to graduate retention, an often forgotten demographic that should be watched carefully by investors – today’s graduates are tomorrow’s young professionals.

Finally, studies by Nationwide have shown that proximity to transport links (in this case, train stations) can have a huge impact on yields. Properties within 500m of a train station can typically command a 9.6% premium while properties 1,250m away will only see a 1.9% difference.

How does growth affect rental yields?

Rental yields are particularly affected by redevelopment and regeneration – something that Bracknell is experiencing in droves. As new developments regularly appear within the £770 million ‘Bracknell Vision’ project, research suggests that these amenities are having a direct impact on population, which in turn drives demand and thus, rental yields.

This is why Bracknell can be considered such an exciting ’emerging’ location. Rental demand is at an all-time high for the town, population growth is forecast to be one of the highest in the country and as more amenity-led developments are completed, the town is attracting more ambitious professionals that are willing to pay extra for premium features. This is encouraging a competitive market that doesn’t have the supply to meet demand, which for investors, means an opportunity to utilise higher asking rents and reap the benefits.

How do ‘ready-made’ investments affect rental yields?

Now imagine if you could harness the growth we’ve mentioned above right now. ‘Ready-made’ investments are an effective way to do this and thanks to No.1 Thames Valley – a very realistic option for investors that are looking to take advantage. With pre-tenanted, fully-furnished apartments available in the heart of Bracknell, No.1 Thames Valley is an opportunity to benefit from the town’s growth so far and get in before it hits new levels.

Conclusion

So what rental yields can Bracknell achieve in the future? As the ‘Bracknell Vision’ plan continues to fund new and exciting developments until 2032, the town itself continues to utilise flexible, mixed-use spaces to meet rising demand – Bracknell is predicted to experience population growth of 15% by 2036, one of the highest in the country. 

Building on Bracknell’s established connectivity is vital and the advent of Crossrail – a new line for the London Commuter Belt that will directly connect key locations such as Bracknell with the capital – will improve the quality of the infrastructure around the town and further boost the effects that Nationwide found in their studies.

All in all, this will create even more demand, creating an even more competitive market and pushing rental prices to higher levels than ever before. With the long-term effects of COVID-19 yet to be seen, many experts still believe that the bounce back we’re experiencing now could continue if demand remains high – an objective that Bracknell won’t struggle to achieve.