Investment: What’s best? A house or an apartment?

[muppet]

Investment: What’s best? A house or an apartment?


Guest blogger Monique Sasson Wakelin is a director of Wakelin Property Advisory, an independent buyers agent.
For more than 20 years, I have been advising clients on how to invest in residential property. Over that time, the one question that comes up more than any other is, “Wouldn’t a house with a backyard make a better investment than a one bedroom apartment?”
The answer is never a simple “yes” or “no”, but rather “it depends” - it depends on the property, it depends on your budget and it depends on the location.

Source

[myplace_11]

its better to invest on an apartment, for me it's more income generating than of a house, a now a days lots of people stay on apartments than buying their own properties.

[mattinvestor]

Thank you for the great article. I am actually thinking about investing in an apartment complex here in Australia or the US. I read that apartment owners make good money since the economical crisis more people live in apartment now.

[Dman]

Hey Matt,

I honestly think it depends on the location of where you'd want to invest. If it's in a central location such as the Melbourne CBD or Sydney CBD, I'd definitely opt for an apartment. But if you're looking into regional areas or in mining towns with high potential growth like Perth or Queensland, then you'd be better off investing in a house. A census that was recently conducted by the Australian Bureau of Statistics about Australia's preferences for landed property or apartments suggests that Aussies do prefer houses. I can't seem to post links in my reply but if you google this, "Fewer occupants, more bedrooms: Census shows Australians prefer bigger houses", you should be able to find the article I'm talking about.

Hope this helps matt, cheers.

[mattinvestor]

Hey Dman,

Thank you for the article. I agree with you:it is all about the location. If I decide to buy apartment complexes in Australia, it will definitely be Sydney or Melbourne. But I also might invest in the American apartment properties somewhere in the south, Texas, for instance, as well.

[James Martin]

If you buy apartments in the states, i would suggest buying a (B)rated or (A) rated apartment units. Anything else will be in the low income area and become a money pit. This may not be true in all cases, but I'm speaking from experience and (3) differ buildings later we still own.

[mattinvestor]

James, thank you for the advice. I agree Class A and B is what I was thinking. I would definitely would not want to deal with Section 8 apartments in Class D.

[JonnoM]

Usually you'll find that growth between houses and units is quite similar in the long term. Otherwise, for example, if units were to grow by 3% annually while houses grow by 8% annually, after 20-30 years units in an area would be $500k while houses on the same street are worth $5M. This is just unrealistic, so the same level of growth would have to be sustained to keep the 10-20% price difference between units and houses in the same area.

In saying this, growth is affected by supply and demand. If there is a high demand for units in a particular area, they may well overtake house prices due to less maintenance etc. I'd suggest this is doubtful though.

Also, capital growth can be achieved through underlying land values. Land appreciates in value, while buildings depreciate, after all. So after time land will become more and more valuable and of course this will boost house prices up as a result.

[Gresham01]

I completely agreed with myspace_11.. Apartments is better choice

[propertyclickhere1]

I think its better to invest on an apartment, for everyone it's more income generating than of a house because in these days houses are very expensive so people likes live in apartment.

[tpr2]

....it depends on the property, it depends on your budget and it depends on the location.....

Actually it depends on your goals, your financial circumstances and your risk profile.....at the end of the day, the property remains the same, i.e a house, an apartment a block of land, it's only the purchaser that varies and hence whether it's a good investment or not so good.

[Davo36]

Haven't seen you post here for a long time Terry!

I actually quite like apartments because of the lesser hassle aspect i.e. no gardens, pets, drives etc. Plus they are really really f**king expensive to build, so can't be undercut too easily these days.

[vietnampottery]

Thank you for the article. I agree with you

[almoyen]

Well, It actually depends on your equity and investment plan. If you want to generate some passive income quickly, then investing in apartments is good. But if you're planning to get huge return on a long term investment, then house is the right choice.

However, it is always better to consult with any property investment agency near you to get valuable advice from real experienced and expert investors. They'll analyze the current economic situation and provide you with the right solution.

PPI - Investment Property Advice and Coaching

[Wilson212]

Hey Dman,

I completely agree 110 %, it's all about location and trick is to find the right property at the right location at the right price. I did my planning, finance, property selection thoroughly for years before my purchase last year. I also put the importance on quality not quantity and invested my times on reliable properties search websites such as:
1. Realestateview
2. Mitula Australia
3. realestate Australia

Cheers.

Hey Matt,

I honestly think it depends on the location of where you'd want to invest. If it's in a central location such as the Melbourne CBD or Sydney CBD, I'd definitely opt for an apartment. But if you're looking into regional areas or in mining towns with high potential growth like Perth or Queensland, then you'd be better off investing in a house. A census that was recently conducted by the Australian Bureau of Statistics about Australia's preferences for landed property or apartments suggests that Aussies do prefer houses. I can't seem to post links in my reply but if you google this, "Fewer occupants, more bedrooms: Census shows Australians prefer bigger houses", you should be able to find the article I'm talking about.

Hope this helps matt, cheers.