Ground floor vs 2nd floor apartment?

[pikla]

This may be a difficult question to answer but would like to get some thoughts.

Went to auction on weekend to bid on 3rd floor apartment. Missed out and the property ended up selling for $468k. Went to open inspection yesterday for a ground floor apartment in same building (less secure, no courtyard, non-elevated, less natural light, and slightly worse condition than the 3rd floor) with identical floor plan.
The REA said that the the auction will not be until spring (~3 months away) and vendor would only consider private sale with offers $460k+ on the back of the 3rd floor result last weekend.

Question is, is an $8k difference an unrealistic expectation on the vendors behalf or a REA doing what they do best, talking BS?

For people in here who have a lot more experience than me, if a 3rd floor apartment sells for $468K what would you reasonably assume a ground floor apartment in the same block would be worth? I know its hard to answer with so many variables (some of which I have mentioned above), but some guidance/opinions would be great

Thanks guys

 

[datto]

Don't knock the ground floor apartment! A lot of people love em especially the elderly. They can be very practical.

Imagine walking up 3 flights , only to realise you left something in the car. You'd be cursing as you go back down. But from the ground floor apartment , no prob.

8K diff is reasonable IMO. Top floor may have the view and might be quieter but ground floor is kore practical.

 

[superAndrew]

Like you said there are many variables to consider.

What if the 3rd floor owner really needed to sell?
What if the ground floor owner is just testing the market and wants to find out what he can get?

Could the auction for the ground floor unit achieve a higher price than 3rd floor unit? Maybe but unlikely.

It also depends who the buyers are. If they are PPOR buyers then the owner might get a higher price than investors would pay.

I wouldn't worry too much about what the agent says. Look at what recent sales of comparable properties tell you about the price and base your offer on that.

You don't have to put an offer that is +$460k. I don't really understand why agents do that. The only offer to put would be $460,001, which I have done before.

All the best

Andrew

 

[Scott No Mates]

If they don't ask for $460k you won't get $460k but you definitely won't get get it if you are asking $400k

 

[pikla]

It would be a PPOR for 2-3 years, then a long term IP.

It is located in a highly sought after location/street but there are not a lot of recent sales to compare to.

We do like it but think $460k is overs. Would it be unreasonable to make an offer less than what the vendor wants (i.e. high 440's, low 450's - which we think it is worth comparing the two) or just wait to go to auction to avoid the lack of transparency when negotiated a private sale?

 

[Joe D]

If physically equal (ie internal floorspace same) and courtyard same as balcony on higher levels then comparison really becomes an issue of the following 3 points:

Aspect / views
Security (gnd floor is usually more vulnerable)
Unit entitlement (theoretically will be lower for gnd floor, but not guaranteed)

In apartment buildings ground floor units are usually cheaper and more impacted by those that live above (noise, people movements, rubbish, security aspects etc)

 

[sammmeee]

Wow interesting, I have always liked a ground floor unit better than a top floor..except if their are views from the top floor..

Easier access, usually a courtyard...

 

[Jen_PFR]

There can be other issues with a ground floor apartment. In one complex we were in, a number of the ground floor apartments had semi-regular backups of the toilet, caused by large tree roots. I'm talking, 'rip up and replace the flooring' backups

In that complex we owned an apartment on the top (second) floor. We'd thought it was tough lugging things like a fridge up the three flights of stairs (no elevators), but after hearing about the tree root/toilet overflow issue, we realised that things could have been a lot worse.

 

[datto]

Good point Jen. I've seen the toilet problem too often. In one of my units the backflow now exits onto the front lawn instead of the lowest unit's bathroom (not a pretty sight). Dang council told us to convert to PVC pipes - what a waste of money! Bludy Dkhed council didnt let us cut down European tree! Soon fix that lol.

 

[pikla]

Wow interesting, I have always liked a ground floor unit better than a top floor..except if their are views from the top floor..

Easier access, usually a courtyard...

No courtyard in this one, otherwise yes, I could justify a similar price to the 2nd floor

 

[Mr. Fabulous]

Hi pikla, I live in St Kilda, next door to a rather... notrious motel. I live on the ground floor, so security is a very real issue. I happen to run my business from home, so I am at home about 95% of the time, which is very much to my advantage. Every one of the units on the ground floor keep their blinds shut all day, every day. The guy that moved in a few units down a couple of months ago used to keep his lounge blind open most of the time, but he doesn't do that anymore, lol.

Even though I am home most of the time, I keep mine shut most of the time as well, other than to air out the place. That's not to say I feel threatened or unsafe, just that I don't feel the need to tempt fate. I love where I live and plan to stay here until such time as I leave to travel.

However, from a landlords pespective, I would probably take the security issue into account when considering purchasing this particular unit.

Based on personal experience, if I was to pick between two units in my block, that were identical (quality wise), I would pay more for a unit that wasn't on the ground floor - that is, more secure - than one that was. Not a *whole* lot more, but the extra security would be a bonus.

As an aside, I have been in this unit for 18 months and the last two tenants that rented the unit next to mine both lasted less than three months and it's been vacant now for at least 2. Just something to keep in consideration. Since I moved in, the landlord hasn't put the rent up once, whereas with my IP, I've put the rent up three times in the same time period. Also, the 'For Rent' signs out the front of the block are on constant rotation.

However, that is for one block across the entire city! From experience, I would suss out the area you are looking to buy and determine whether security is an issue for the area you are looking in. Don't discount a ground floor unit simply because it's on the ground floor. A ground floor unit in St Kilda is a different kettle of fish to a ground floor unit in, say, Blackburn.

 

[Macca]

I have never owned units but I have lived in them. I decided my favourite place was on the first floor.

A nice balance, not too many steps, better security, no toilet problems, often but not always a view and always good airflow, suited me.

To me, top and bottom floor in a 3 story block would be equal with the middle floor being the best.

 

[WattleIdo]

When I was looking for my unit - initially to live in - I wanted a ground floor unit because of the cats. Ground floor was very hard to find. I found one or two but they had issues such as having windows onto the carpark which would've been unpleasant for me and unsafe for the cats.
In the end, I settled on a top/third floor walk-up. I'm glad I did. The cats I had at the time were pretty wild so used the stairs as an excuse to not come inside ( there is a heritage listed house next door with a huge overgrown garden - please don't freak out cat sceptics - they behaved themselves and generally hid there or slept on some hay in our own small garden that I made).
Two young subsequent cats found racing each other up and down the stairs a real hoot! They would go out in the morning when I left for work and come in at night when I got home. They were pretty savvy about the carpark.
The walking up and down didn't hurt me at all, either.
I loved living in the flat - so public and yet so private. Everyone tries to be flexible and accomodating .... most of the time.
Would still go for ground floor so it's easier for the dogs if need be. But it was really really nice being up the top - less frustration about noise, too.