Apartments in Adelaide

Hey guys,
I'm graduating uni this year and I got a grad job in Adelaide! This has caused me a bit of a headache for buying/renting property. I was wondering if buying an apartment in Adelaide was a good investment in peoples opinions?

I am looking at either a studio apartment in the city for about 150-180k vs. some really good one bedroom, pretty spacious, apartments for 250-280k.

Not sure if this is good value for what I am getting and more importantly I was wondering if this is a smart move to beginning a property portfolio!

Any advice would be much appreciated, I am very new to property and am overwhelmed right now to be honest. Thanks!
 
Hi Bakachin1

Hey guys,
I'm graduating uni this year and I got a grad job in Adelaide! This has caused me a bit of a headache for buying/renting property. I was wondering if buying an apartment in Adelaide was a good investment in peoples opinions?

I am looking at either a studio apartment in the city for about 150-180k vs. some really good one bedroom, pretty spacious, apartments for 250-280k.

Not sure if this is good value for what I am getting and more importantly I was wondering if this is a smart move to beginning a property portfolio!

Any advice would be much appreciated, I am very new to property and am overwhelmed right now to be honest. Thanks!

Hi bakachin1,

I think we are all learning here and I think you have made a great start by accessing a medium such as this community to try and start your education...so well done.

There are many people that contribute on this forum with a wealth of knowledge far more developed that mine so...with that said and IMHO you should start by perhaps getting some expert advice or at the very least take some time to allow yourself the opportunity to develop your knowledge...infact this would be the most important.

There are a whole host of issues you might want to consider before even starting to look at properties such as: what are your goals? What do you want to achieve by investing in property? How are you going to get to that objective? Are you going to be geared heavily or do you need to see some cashflow in the deal to keep your head above the water? Etc etc...

Finance is crucial but you need to set it up correctly from the start or you will suffer further down the track. There are brokers on this forum who will provide advice and will help you to select the right products.

Soon enough you will begin thinking with your head and analysing the whole deal. There are some fantastic opportunities in Adelaide but first you need to set yourself up for success.

I began my journey by wanting something better for myself and my family. I read books by Jan Somers, Margaret Lomas, Michael Yardney, Steve McKnight, Robert Kiysaki. I subscribe to the Australian Property Investor and Your Investment Property magazines and read the Financial Review...do what ever works for you.

I'm sure there is a whole host of reasons why average Australians don't invest in property but I'm sure that many don't because they just don't understand the benefits and can't be bothered finding out because that would mean putting some effort in....most people expect things are going to be handed to them and if they're not...well...then they just don't bother like 95% of people.

After you educate yourself you might find that what you thought might be a good investment may not be!

What a rant!

Only my humble opinion but take a breath and learn.

JT

Ps. I like Plumpton in Adelaide for units. Great position close to CBD and the beach and opportunity to add value...all for <$250k
 
Yeah I think a few people would say on here that Apartments can be OK but do have draw backs for the first investor, especially with Levies, and fees etc. Ie they may not turn out to be the investment they first seam.

Depending on what you have to spend, a Unit like JT says maybe the best option, Keswick, Thebarton, Prospect and areas nr the city like that may be worth checking out.

Good luck with the first purchace, It wasn't that long ago that I was there :)
 
Thanks so much for that guys!

To be honest I only started considering buying a property because my parents think it would be best to invest. I am in a good position to by, I have saved my money since I was about 19 (3 years ago) and have about just over 1/5 saved of a 250k property.

My real goals are pretty simple, just avoid paying rent (dead money) and have a property I can comfortably live in for a few years. If after my 3-5 year life in Adelaide is over I might keep and rent or sell the property. But ideally my goal is to learn about property and just have one under my belt.

Adelaide seems like a good area for be, because it is rather cheap compared to many places around Melbourne.

I was tentative about apartments, and the best appeal about a unit for me is that it has land associated with it!

I will check out the suggestions. Thanks a lot guys! I have been rushed into making a decision (I just got the job offer last week) but I feel much more comfortable I will find some answers. Thanks again, I appreciate it soo much!
 
One more thing though, what attracted me to apartments was that so many are available fully furbished, which is good for me! I dont have any furniture (I live at home in Melbourne) and getting all that organised could be a pain!

And most apartments are close to public transport, another issue for me!
 
One more thing though, what attracted me to apartments was that so many are available fully furbished, which is good for me! I dont have any furniture (I live at home in Melbourne) and getting all that organised could be a pain!

And most apartments are close to public transport, another issue for me!

From my experience:

Don't go into furnished one. Buy as much floor space as possible for the same dollar (i.e. a bigger, older, uglier one than a new small one)
Research the body corporate/strata activites and plans (agm minutes etc) to see what current and future maintenance costs are for the building and build this into your offer price)

A kitchen like this one:

http://www.realestate.com.au/property-unit-sa-camden+park-106556761

has a lot of potential for future value add (and who knows, orange laminex counters might come back into fashion! :eek:)

Find the nearest salvo's or Vinnies store to furnish your abode.

The Y-man
 
Ditto on avoid the furnished apartments, better money on getting greater value property.

What with the likes of Super A-Mart and such you can get yourself almost all your furniture in deals under 3k.

Personally I don't like apartments that much, I think in Adelaide a unit/small house suits better. High tendency of apartments in Adelaide for apartments to be lower socio-economic unless in CBD/North Adelaide - Melbourne st/ Mawson Lakes.

You also have to look at whether if you possibly leave in three years and sell whether you made the most potential. After borrowing costs, fees, stamp duty, selling costs would you have made much (potentially any!) profit in comparison to renting. All things to consider.
 
I've started to look at some apartments, I have a very, very amateur question.

If I buy an apartment, what happens once that buildings life is over? i.e. the building needs to be rebuilt ect.

Some of the units I'm looking at are on 2-3 storey buildings that seem very old, I dont get any land with these properties, just a fraction of the building on the land?

I have seen a couple of units like small granny flats, but they have their own piece of land. If I buy one of these I presume I am also buying the land?

Embarassing questions, sorry about ignorance in field!
 
If I buy an apartment, what happens once that buildings life is over? i.e. the building needs to be rebuilt ect.

It'll be part of the body corp sinking funds to rebuild. Remember a well built structure should last a long time.... but I know what you mean. One of our apartments was slowly collapsing - so used a lot of filler and sold it fast!

The Y-man
 
Some of the studio apartments in Adelaide have seen very little to no growth over the last couple of years. I'm pretty sure the iPad studio apartments have been around now for a good 18months now and they are still advertised for sale around the same price as when they were new...

I think there would be limited demand for studio rental in Adelaide apart from students...and they may not want full 12 month leases if they are traveling home over holidays, etc.
 
Renting isn't neccesarily dead money. At first it's generally cheaper to rent than to purchase a property as a PPOR.

You have a job in Adelaide. Might not be such a bad idea to rent for the 1st year to see if you like the job and if it's a long term job. Also spending a year in Adelaide, you can do more research into areas of Adelaide (as you'll be there) and maybe pick a great place after a year.

Also you may decide to rent and build an investment property portfolio. Don't buy a property just for the sake of buying a property, just to avoid rent. Interest expenses, rates, body corp are generally higher than rent intially.
 
Thanks a lot for that guys! I did a bit of research and I think it is clear that units near the city are better bang for buck than studio apartments within the city! From what I have gathered this is what I know about multi-storey buildings and apartments:
You pay a sinking fee (usually quarterly), as well as Body Corp fees ect. to help cover the cost to rebuild the building once it’s life is up. And once a new building is built, the body corp is obliged to provide you a new unit/apartment with similar features, namely size of rooms ect.

Is that right? I hope so. If that is correct it would make my decision a lot easier. I used to think once the building was dead, your investment was gone :O
 
Bak, that's right but not something most people would concern themselves with. What sort of unit are you looking at? I can't think of many in Adelaide that you would outlive.

There are a stack of units in Adelaide around land value anyway so if it needs rebuilding at some stage then you'll end up with a nice new unit. :)

2 bedroom unit inside a 5km radius of the city centre is where I see pretty good value at present.

Go for it. Make some improvements to it while you have the time to tinker away at it while you're living in it.

Gools

p.s. Wish you hadn't got me looking again, might have to go and arm wrestle the bank manager again. Would have thought these two would be worth looking at. Go and low ball the Fullarton one, I would have thought you can't rent a single level 2 bedroom unit that close to the CBD for < $300/week now.

Fullarton Unit

Parkside Unit
 
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