Hi Everyone,
I now have at least $37,000 money that I can use to invest in either a unit or a house. I am tossing between the two and not sure about buying another unit – I find the annual corporate fees on top of the council rates quite high. I guess with a house you don’t have that plus you get a block of land which is fast becoming rare.
Any advice would be much appreciated.[biggrin]
Thanks to everyone.
Rose
http://www.elegantdog.bizRose
Hi Rose,
Here is a link to an article on the residex web site that you may find useful,
http://www.residex.com.au/index.php?content=article12Regards
Steven
Mortgage Broker[email protected]
http://www.mobilemortgagemarket.com.au
Ph:0402483216
Ph:1800 820 500
VICTORIAPLEASE note comments made should not be taken as specific taxation, financial, legal or investment advice.
Personally, I prefer houses to units at any time. CG tend to be higher, and there is none of the hassle with body corporates. On top of that, if the land is big enough and/or in the right location, there is always potential for development and even higher CG later on.
Go for houses[wink2]
SG.
Rose,
Houses appreciate more than units in urban areas, where land is in short supply. Where land is in great supply, you can buy a block of land for $1500 (try katanning on domain.com).
The “land appreciates, buildings depreciate” saying is true for many markets- but land does not always appreciate- in some rural locations, for example.
BC fees for units can be expensive, but the more that is in a BC fund, the more your property will be worth more to investors because investors know there is room for contingencies. BC fees all vary, and I try to make mine no more than 2k per year.
I once had a unit where the BC fees were about $300 a year all up, but really, there were no repairs etc undertaken for the block.
kay henry
I have bought 3 units in surburban Melbourne over the last 5 yrs. I have done well, but in hindsight I would have made more if I bought houses.
But they would have cost me more to own initially.
So it was a bit of a trade off.
From now on, I am only going to purchase houses, even if they are not in as good a location as the units were.
Hi Rose
The answer of a house or unit cant be easily answered. If you can afford a hose or unit same location then the house would be better, but you probably find you could afford a unit in a better location to a house, now you have to decide if the units location will give it better capital growth compareed to a house in a worse location. We have both and when we look for a new property I would be looking for the one that offers me the best location. Infact we have a unit with uninterupted city and river veiws in brissy and it has shown the best growth of all our properties and it,s land valuation has gone thru the roof.So the question of which is best cant be easily answered.When there is an oversupply of rentals, units are always first to become vacant, you will very rarely have a tenant leave a house for a unit, but most are keen to leave a unit if they can get a house.
Returns are sometimes better on units, but the higher the return, the higher the risk.
Times aren’t always going to be good, so houses will always be better in the long run.investron, depends on the tenants as to if they want a house of unit to live in- it really depends on the demographic you’re targeting. A lot of young people do NOT want to live in a house- they want to live in a unit in the city, with a gym and a pool. If you are targeting the suburban nuclear family with kids, then yes, they do want a house for the kids.
It also depends on the demographic of tenants and their cultural background. There are some people who come to Australia- for example some International students- and in their culture, everyone lives in units.
I know people like John Fitzgerald say suburban houses are the best investment proposition- due to the nuclear family model, but for many people- including me- I prefer apartment living. I can’t be bothered mowing lawns and stuff either. I lived in my last rented house for 12 years, and we always go someone to mow the lawns because it just wasn’t an interest of the tenants (we were workers and students and saw it as something of a drama).
kay henry
Rose I can only say what my mother tells me however I can also add personal experience. I have bought houses and flats and the houses the LAND is what continues to row in good times and bad. You can always pull down a house but you cant a flat or unit. Buy where you can afford its ok if its a little further out. It will still b better off.
Hi Rose,
We would only every buy a house rather than a single unit. We like buying blocks of units, becuase there is no body corporate. I have always thought (right or wrong) that when the market is going flat, that single units go down in price quicker than houses. I’m sure there are differences in opinion here..
In this flat market, I wouldn’t buy a single unit, unless it were WAY BELOW market price. I don’t like the idea of body corporate fees. I like to be totally in control of what gets done.
I also found that when investing in regional areas, that houses get rented much quicker than units.
Just my opinion, [blush2]
Del
hehe Del- try buying a block of units in Sydney
)kay henry
Hi Kaye,
No thanks!! [blush2]
I’ve heard from reading a post by a very reliable poster that there is negative cap. growth in Sydney!! [biggrin][biggrin][biggrin]
Del [biggrin]
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