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Flats vs houses - the buy-to-let question

Published: 10/03/2021

There are a lot of things to consider when looking to start buy-to-let portfolio, or indeed increase it – you need to decide on your budget, will you need a mortgage, or are you in a position to be a cash buyer? Next, you make your choice of location, will it be urban or rural? Often the question of ‘urban or rural’ is answered by your budget and the rental yield you are looking to achieve. If you find yourself in an area like Norfolk where rental yield is high in the vast majority of areas, then you may find yourself faced with another question – do I invest in a flat, or a house?

The preference of flat vs. house is often subjective – a Landlord’s personal taste and preference for style of living is often reflected in the properties they own. However, if you are not a ‘professional landlord’ just yet and are starting to build your portfolio, or you are simply looking for an additional income to help flesh out your retirement fund then you can often find yourself scratching your head and wondering what is best for you. As with a lot of big decisions, it is sometimes most sensible to put pen to paper and write down the pros and cons for each.

The facts and figures

We know that sometimes a glance at the facts and figures can help cement a decision for an investor. We have looked at the Rightmove figures of five flats and five houses we have marketed and let agreed during the period of September 2020 to March 2021. The data shows that houses came out on top with 23% more interaction on Rightmove than their vertically challenged counterparts, 20.3% more viewings and 62% more applications to rent the property from our Landlords.

If you are a follower of the facts then investment in a house may be on the cards for you and it is only an added bonus houses tend to grow in value quicker than a flat – since the year 2000, terrace house prices have jumped by 96% from £189,394 to £321,519 across the UK as opposed to a 70% increase in the same period for flats/maisonettes. As well as the natural swelling of the market, houses are easier to increase in value the manual way by renovation or extension whereas improvements to a flat are sometimes rather limited to cosmetic works.


If you are looking to increase your portfolio quickly then the lower purchase price on a flat may be beneficial to you – the lower purchase price and often higher yields can equal a really quick transaction for those portfolio Landlord’s looking to build a steady income and build it fast.

However, the costs involved in owning a flat need to be considered – there is ordinarily a block management company and a head lease to adhere to. It is important to consider the terms of the head lease – whilst exterior maintenance is often not the responsibility of the owner and will largely be handled by the management company, which can often be seen as a ‘plus’ of owning a flat, you will need to pay an annual service charge to the management company to keep the communal areas and insurances ticking over and often there are restrictive covenants that both you and your future tenants will need to be aware of.


If you prefer to be more autonomous with your property ownership then a house may be more suitable as you will have greater control of the maintenance of the exterior, parking arrangements and insurance cover. However, always make sure you are ‘au fait’ with the boundaries of your property to avoid disputes with your neighbours when the fencing takes a tumble in the high winds.

Aesthetics and admin aside, one of the most pertinent things to consider when investing in a property is what sort of tenants will you attract? It goes without saying that the majority of Landlord’s want long term tenants, who will be prompt with the rent and keep the property in as good a condition as possible.

Logically, we tend to see more families gravitating towards houses with room for the family unit to grow, often they have permission to keep domestic animals and you can find 3–4-bedroom houses both rurally and in a more cosmopolitan setting so your applicant pool is really very deep.Young professionals or retired individuals may be more attracted to a flat due to the size and more often than not, the location.

Tenancy length

Tenancy length can vary for both flats and houses but on average, you will get a longer-term tenant when offering a house for rent whereas flats may have greater success in a city setting as you will corner the market on younger people with generous income looking for a well-placed bolthole for 12-24 months until they move on.

The important message to consider is that the purchase of a buy-to-let property is a brilliant investment, but it is one that should be considered very carefully. We hope the above point have helped you form a good idea of the positive and negatives of investing in both houses and flats.