When you are ready to purchase a property, making the right decision is important. Purchasing a new home is generally one of the biggest, if not the biggest decision, that you will make in your life. Doing the research and considering your needs and wants thoroughly is vital. You shouldn’t be rushing the process. An important part of this is deciding whether to buy an apartment or house for investment.
The decision between purchasing an apartment or house might be an easy one for some. If you love the inner-city lifestyle, then purchasing an apartment is the only way you will be able to maintain it. Likewise, if you are raising a family and looking for a quieter environment then a home will be the only way forward. However, if you do not fall clearly into either of these groups or you are an investor and are tossing up between an off-the-plan new home or an apartment, here are some important considerations to spend some time thinking about.
Apartment or House for Investment?
Often purchasing an apartment can be a cheaper option to buying a house given the apartment rarely comes with the higher value land component. However, it all comes down to location and size. There are in fact many house and land packages that are 3-4 bedrooms that are much cheaper than an inner-city or inner suburb apartments that are only 2 bedrooms. Also, keep in mind that the majority of the capital growth you will enjoy from the property will be driven by the land values, and hence why historically a home provides better capital returns than apartments.
There is no hiding the fact that apartments are smaller than most houses, and they rarely have their own private outdoor spaces. Although they may have lots of shared outdoor terraces or playgrounds, they are not exclusively yours and can lack privacy and security. Depending on your particular lifestyle preferences, this could be a huge consideration. If you like to have friends and family round for a BBQ on the weekend or enjoy being outside with the kids, then purchasing a house might be the only option for you.
Maintenance requirements & regulations
There are a few things to consider when you think about maintenance in either a new home or an apartment. The biggest is probably the restrictions that an owners corporation will likely place on you if you decide to make changes to your apartment. These sort of regulations can really frustrate people, as they have to pass almost every maintenance idea through this group, from redoing the floors to installing an air-conditioner.
Additionally, apartment owners will have to pay a fee to the owner’s corporation to handle repairs and maintenance to the overall apartment block and surrounding facilities. If you think maintaining an apartment will offer you saving over a house, think again due to owners corporation fees. These can often be $5,000-7,000 pa, which gets you a lot of maintenance on the home (which for new homes and land can be very little)!
This is a completely personal decision. It ultimately comes down to whether you think that you and your family will thrive in an apartment or in a house. You should always look forward into the future with this one, as your needs and lifestyle will change. For example, will your family grow in the next 20 years? Or are your kids planning to move out? Do you want to be able to look after your parents when they get older? All of these sorts of considerations will help you choose between a new home or an apartment.
Choosing the perfect home for your family and needs is a decision that you ultimately will want to make with your heart and mind. You have to live in this home for a substantial time of your life, and while for some it may just be an investment, for others it could be your family home. Researching which option is best for you is vital.
Need help getting started? iBuyNew will point you in the right direction! Whether you are looking for apartments, townhouses or house and land packages, working closely with an iBuyNew property consultant, who understands the market, will help you find something suitable that’s tailored to your needs and requirements. Get in touch with them on 1300 123 463.