Hi
I have been a member of this site for some while…since I started looking at emigrating to Australia.
I have now arrived in Melbourne and want to start getting invested in property. Up to now I have not really visited this forum, but now it will become a daily stop.
My first question stems from rumours etc that the wooden building structures on last 30 to 40 years.I have to admit that this type of construction takes some getting used to for me…..only ever knowing brick constructed homes. And our rental property is so noisy…….sound seems to be amplified in the house!
Anyway, if a house only lasts for 40 years, it should be getting cheaper as it gets older. However this does not seem to be the case……..
Hi Oryx,
Congratulations on emigrating to Australia.
If maintained a timber veneer house should last more then 40 years. I see plenty of 1940s built houses still around and that is 70 years. There are often many other variations (more popular depending on area) like brick veneer and double brick.
If you are worried when purchasing an older style home make it a condition of purchase that you obtain a Pest, Building and Electrical report. All up it would cost you about $800, but it is piece of mind.
The comment about getting houses getting ‘cheaper’ is understandable (buildings do depreciate) and that is why some investors gain a deprecation bonus from the ATO. However, when purchasing a house you are buying 2 things, the house and the land underneath.Often older homes are in older areas, and commonly have larger blocks and are closer into the city. This means that when purchasing a house that is super old, you are often purchasing almost 100% land content.
Now land is what the driving factor of the growth is, because land is finite. That is why many growth investors purchase high land content.
To your success,
Kent
Thanks Kent
It all makes (more) sense now!
Yes no and maybe…. A house should last 40 + years with absolutely no maintenance whatsoever however the return on that property will also be reflected in its value.
There are plenty of 100+ year old houses in the inner city of Melbourne, Sydney and elsewhere which have been maintained and command premium prices simply because they are character homes.
I have a home built during the great depression not far from my house. The house was relocated from Mt Morgan to Brisbane timber by timber and rebuilt, looks in very good nick today. No indication of the maintenance or renovation costs along the way though. It's about to be sliced and diced to fit another house on the block, which is the key really, if the timber can last long enough for the land to be utilized for higher use then that's all it can reasonably do.
I regularly get the request for brick houses as the perception is they will be more low maintenance, all depends
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