Divide and prosper

Flats are a growing market, says Rosalind Russell

The second Baron Carrington had a reputation for eccentricity. When he took a lease on Gayhurst House, an imposing country mansion near Newport Pagnell, he provided his male servants with a remarkable five- seater lavatory in a circular building behind the house, surmounted by a carved figure of Cerberus, the three-headed dog. He lived in style, with his wife, five children, a chaplain and 31 servants. Now 26 households share Gayhurst - split up into flats and houses in the Seventies - and with its ornate mullioned windows, formal gardens and garages, it is far superior to other converted flats.

A one-bedroom apartment in Gayhurst will cost pounds 97,500, say agents GA, for the 100 years remaining on the 120-year lease.

Buying a leasehold flat is now less of a lottery, thanks to the new changes to the Landlord and Tenant Act 1987. Initially hailed as the leaseholders' charter, the Act was found to be shot through with holes. While it gave tenants the right to first refusal of their freehold, the freeholder didn't face a penalty if he thumbed his nose at the Act. Now he does.

A few lunatic freeholders and residents who quibble about their share of the roof repairs will always be with us. And anyone considering buying a flat should still take particular interest in the efficiency of the managing agents. But flats still have advantages over houses for young professionals, older people trading down from an expensive house, or as a rental investment. While lenders won't generally offer a mortgage on an ex-council tower block or flats above shops, the rest of the flat sales market is enjoying a mild boom. Especially in Birmingham and in London where there is busy regeneration in areas like Bermondsey, Clerkenwell and Soho.

Paying pounds 300,000 for a flat in the centre of Birmingham - albeit a penthouse - might have seemed optimistic a couple of years ago. But that's the price being asked on one of the flats soon to be completed by Crosby Homes next to Birmingham Symphony Hall. Symphony Court, with octagonal domed towers and private terraces overlooking the canal, residents' gym, underground parking and high security, has drawn buyers back to the city centre.

John and Vanessa Clarke sold a house in Walsall and bought a two-bedroom flat in the block, so they could be near their daughter Louise, 16, who will be studying in the city. Others buyers are finding the flats an attractive investment, with rentals on a two bedroom apartment achieving a far higher percentage yield than anything currently offered by banks or building societies. For Crosby the development has proved one of their most successful. With 112 apartments sold and only 30 left to sell, asking more than a quarter of a million for a penthouse doesn't seem so daft.

In London, Strutt & Parker is selling a one-bedroom, second floor flat above Terence Conran's Mezzo restaurant in Soho for pounds 310,000. In suburban Putney, that would buy a three-bedroom house, but a much longer commute to work.

Says Charles Peerless of Winkworth's West End office: "Buyers in Soho and Covent Garden tend to be ABC1, mid-thirties, affluent, from bankers to creative. Fitzrovia is the best value for money, being quieter than Covent Garden but having more life than Bloomsbury. It's not a family area, which is something our business reflects... we don't open on Saturday."

Prices are sufficiently buoyant for Winkworth to have recently sold a one-bedroom flat, directly opposite a 24-hour shelter for the homeless, for pounds 150,000. A one bedroom, fourth-floor walk-up in King Street, Covent Garden has just sold for pounds 185,000. In the three weeks between compiling the latest copy of the Winkworth property guide and it hitting the stands in branches, the West End office has sold everything on their page bar two flats.

"Look for the well-run blocks," says Peerless. "Bloomsbury's Bedford Court Mansions is one of the best because it's part freehold. Ridgemount Gardens where a four-bedroom flat will cost around pounds 265,000, is also very popular. Of the new developments," says Peerless, "the ones which are selling fastest feature contemporary design, wooden floors and chrome fittings." It's a perfect description of a re-developed printing works at one Dufferin Avenue, near Moorgate tube station.

Of the eight apartments put on the market a fortnight ago, only three are unsold. Architect/developer Roger Black has aimed at style-conscious buyers likely to be impressed by the German column radiators, ash flooring and "pod" bathrooms, Prices range from pounds 175,000 to pounds 215,000; the most expensive has a timber-deck roof terrace with views over the City. Selling agent is Hurford Salvi Carr.

Actor Alexei Sayle is leading the way in Bermondsey, buying into the new Tanners Yard apartments, a few minutes from Tower Bridge and close to where the new Jubilee Line extension will run. More than half have been sold or reserved in the old warehouse building. The developers say their buy profile is young, upwardly mobile professionals. Prices range from pounds 139,500 to pounds 199,950.

Shad Thames, a previously unloved area south of Tower Bridge, is also being talked up. A former tea and coffee warehouse in Boss Street is being turned into 109 flats, due to be ready for Christmas.

Tom Marshall of selling agent Cluttons says: "The refurbishment includes glass lifts, glass viewing platform with panoramic views." More sandblasted brickwork - the woodchip of the Nineties - cast-iron columns, wooden floors and industrial-height windows.