"Apartment buyers tend to prefer bright, sunny and well-lit homes that require more energy-efficient and sustainable living arrangements."
How to avoid a 'lemon' when buying an investment apartment: Frank Valentic
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Owning a home has long been a dream for most Australians. In recent years, the property squeeze has forced many potential buyers to look at other alternatives such as units and apartments. With people living busier lifestyles today, apartment living is proving to be a very popular option.
In fact, over a quarter of our population (27.3%) are now living in units and apartments. More people are choosing to leave the quarter-acre suburban block behind that was popular in the 1990s and opting for the “lock-up-and-leave” advantages of an apartment.
Consider also the hundreds of thousands of immigrants moving here from Europe and Asia, with many of them also buying apartments. In these parts of the world, apartment living is the norm – generally because it is very affordable compared with buying a house. Low-maintenance living is the way of the future and in my opinion, is here to stay.
With the above information in mind, it would be remiss of me not to mention the flipside of apartment buying. To avoid purchasing a “lemon”, be prepared to do some homework, as it will save you lots of dollars and heartache in the long run.
Not all apartments will make profitable investments, mainly because some of them achieve minimal capital growth over the long term. This is due to a multitude of factors and may include things such as: exorbitant body corporate fees that eat into your rental returns, buying in a low-growth location or simply buying in a bad position.
Our buyers’ agency has adopted a strict “investment-grade” criteria in helping over 2,000 buyers purchase apartments in the last 12 years.
So what are some of the advantages of apartment living?
• Less repair work – An apartment will generally require far less maintenance and repair work than a house, which will always have more structural issues including plumbing, wiring, stumping, roofing and much more.
• Minimal maintenance and general upkeep – Houses generally require more attention in terms of ongoing maintenance than that for apartments. There is no need to mow the lawn or do the gardening. Leave this to body corporates. Enjoy more time to yourself on weekends to do the things you love.
• Access to leisure facilities – Depending on what you buy, you might have access to communal leisure facilities such as swimming pools, gymnasiums, barbecue areas and bar/restaurants.
• Higher investor returns – For investors, the returns are generally 1 to 2% higher than for houses. This results in better cashflow and less money out of investor’s pockets.