With spring just around the corner, homebuyers who’ve so far been priced out of major city markets, now have a great opportunity to snap up desirable properties at reduced prices. But what’s the better prospect – a house or an apartment?
Whilst more sellers have struggled to shift properties this year, it’s been a different story for buyers. Given that homes are now somewhat more affordable in key markets, property hunters will be able to consider more options throughout spring. Those who feel they’ve been restricted to looking at apartments may even be able to nab a house instead. However, which is the better choice for your needs – a house or unit?
If you’re in two minds, consider our list below and rank the most vital factors of owning a house or apartment against the least important.
Firstly, figure out what kind of place you want. Buyer’s agent Veronica Morgan from Good Deeds Property Buyers says if you truly want to live in a house, then ask yourself how you’d feel if you opted for an apartment instead on account of a cheaper price. “It may sound like a silly question, but you’d be amazed at how many people end up opting for a dwelling completely different to what they actually wanted due to various factors,” she says.
“Question whether you can surrender off street parking, a spare bedroom or ensuite bathroom (maybe a second toilet in a laundry will suffice). Or maybe you can live with that dated kitchen or bathroom for five years. Perhaps a townhouse would do instead of a house? If you absolutely, positively cannot compromise on the size, style, scale or condition of the property, then you may at least have to reconsider the location.”
Look at the links of everything that sold over the past three to six months that fulfil your requirements. Ideally you should do a “drive-by” of every property that you think could have passed muster.
Everyone has a wish list of ideal suburbs. But sometimes you need to widen the search area. “Often buyers like to limit their search to areas and suburbs they’re already familiar with and like,” says State Custodians general manger Joanna Pretty. “However, if your budget just won’t stretch to nabbing a home in the suburb of your dreams, then identify what it is you like about your ideal suburb and see if there’s places elsewhere that fit a similar bill. Whether it’s café culture, bush walking expanses or beach areas, have a good look around.”
Go on some weekend excursions to check out other suburbs that might fit the bill, hang where the locals hang to get a feel for the area and test out the commute to work.
So, answer this honestly - how much money do you really need to be able to afford your dream home? Is it achievable or it is way beyond your means? Or are you actually being too conservative? Sit down with your lender or a mortgage broker and do some hard sums. Review all your outgoings and come up with an accurate figure of what you can or can’t afford.
How much money a dwelling will make should you decide to sell down the track, largely depends on what area you’re in. In the weakly performing Sydney and Melbourne property markets, apartments have weathered the conditions better having outperformed houses in the last 12 months with across the board growth of around 0.4 per cent nationally. However, in all other capital cities where housing affordability is not as strained, houses have outperformed units in relation to capital growth.
Do research comparing and contrasting the sales figures for areas with similar types of properties. Also ask yourself how long you plan to stay in the property. And seek out a few differing experts’ opinions.
Lack of outdoor space: If you’re deadest on garden parties, then an apartment’s never going to cut it. Many apartments only have small balconies high up in the sky and some have no balcony at all.
Bedrooms: Whilst there are three-bedroom apartments around, the majority are only one or two bedroom dwellings. If you are wanting to have kids, chances are you’ll need to move when number two comes along and wants their own room.
Limited expansion: Whilst you can usually extend a house to create more room, there’s nothing much you can do with an apartment’s footprint.
Peace and quiet: If you like lots of privacy and detest noise, then apartment living long-term is going to be challenging, particularly if you have thin walls.
Strata fees: These pesky fees can be really expensive, particularly if the grounds have extra features like swimming pools and gyms to upkeep. If you don’t use such facilities much, it will be aggravating.
Property condition: Slick apartments are aplenty, but few homes are turn-key ready. Usually a typical house will require some kind of renovation to bring it up to your standards. So be prepared to put even more money into this.
Lack of free time due to maintenance: A lot more upkeep is required with a house – both inside and out. You’ll have to dedicate more time (and money) to mowing lawns, painting and cleaning to protect the property from deterioration.
Location: Often the trade off for an affordable house, is one in a suburb that probably isn’t your first choice. You may even have to move quite far away from your work and loved ones.
Price: Typically, a house in the same area as an apartment is going to be the more expensive purchase. If you've found a dream property and have your heart set on it, you’ll need to consider if you can make it work by possibly reaching deeper into your pocket or tightening your belt more than you initially wanted to.
See if you qualify. To get a more accurate idea of how much you can borrow with State Custodians,