Unit vs House

Hi,
I have been looking for an investment property in Sydney in the past couple of months but it just seemed the prices are on the way up up. My price range is around $280K-$300K. I have been looking at units within 15km from city. I have found a 2br unit, near train, near school but in an old block of units, which require some furnishing in the future. However, if I go further away into the west, about 30km from city, I could get a 3br house near train station, on an average block around 500sqm. The rental income is pretty much the same. Which one would you recommend?
Thanks.
 
Depends on the area. Although the unit 15kms from the city sounds like a good buy?
Ryde is one are that is about 15kms from the city and under $300k for the area is pretty hard to come by!
 
land

Hi tv2

If you go house out west rather than unit , you maybe able to develop the land at a later date and add value

if you go unit you may get better CG but not be able to do anything with it later to add value

this question has vexed greater minds than mine

remember this probably won't be your last buy , so don't stress too much about it

good luck , but what ever you do , just do it

stuart
 
Which one would you recommend?

1/ What is your chosen investment strategy?
2/ What are you wanting the said property to achieve for you in relation to your answer to Question 1?
3/ Do you think the said property will provide you with what your answer is to Question 2? If it ticks the boxes, then its a no brainer.

The property itself is merely the conduit or vehicle as to how you will be driving it (your strategy). A lot of people dont realise it tho.

The majority of people (mostly newbies but not so new as well) are too property (vehicle) focussed and dont even entertain the question of is it the right vehicle to use (via their strategy) to get them to where they want to go.

Property Investment is not about 'the' property.

Hope this provides some food for thought.
 
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1/ What is your chosen investment strategy?
2/ What are you wanting the said property to achieve for you in relation to your answer to Question 1?
3/ Do you think the said property will provide you with what your answer is to Question 2? If ticks the boxes, then its a no brainer.

The property itself is merely the conduit or vehicle as to how you will be driving it (your strategy). A lot of people dont realise it tho.

The majority of people (mostly newbies but not so new as well) are too property (vehicle) focussed and dont even entertain the question of is it the right vehicle to use (via their strategy) to get them to where they want to go.

Hope this provides some food for thought.

Why does this look familiar? :p Oh yeah, I remember

But it's a good thing to keep in mind, even for a "not so new"...
 
Hi,

Thank-you for your reply, it is much appreciated.

I did work out the pros vs cons for both long term investments and maybe wiser to choose the house. Although the unit is quite appealing, but I could do more work & add more value to the house/land.

Having a second thought, I might 'hold' my searching for now. Home prices is at its peak in Sydney now due to the low interest rate. It is harder to find a good house below the $300K range.

I just read an article yesterday called "Houses for $75,000? What a difference a decade makes?". It is a very interesting read. So tempting, should i be moving north to Brisbane for my IP? lol...

http://www.smh.com.au/news/domain/a...-a-decade-makes/2010/02/04/1265151934425.html

Cheers
 
Hi,

Thank-you for your reply, it is much appreciated.

I did work out the pros vs cons for both long term investments and maybe wiser to choose the house. Although the unit is quite appealing, but I could do more work & add more value to the house/land.

Having a second thought, I might 'hold' my searching for now. Home prices is at its peak in Sydney now due to the low interest rate. It is harder to find a good house below the $300K range.

I just read an article yesterday called "Houses for $75,000? What a difference a decade makes?". It is a very interesting read. So tempting, should i be moving north to Brisbane for my IP? lol...

http://www.smh.com.au/news/domain/a...-a-decade-makes/2010/02/04/1265151934425.html

Cheers

How well do you know Brisbane compared to the area you're looking at now? Remember "past performance is not an indicator of future results". There was a recent post on here (can't remember by who or in which thread) in which the poster suggested that they look at areas that have NOT grown recently, with the expectation that if surrounding suburbs have grown then this underperforming suburb is likely to grow in the future.

I believe that "timing the market", for a long term buy and hold-er, is a mug's game. If you hold off and hold off you may never buy - when IS the best time? I personally believe that the best time to buy is when you can afford it. Time will even out the bumps.

And couldn't this article relate to many different areas? I could substitute Rocklea for about 20 suburbs/areas in Melbourne suburbs, Geelong and regional Vic.

My point is NOT that Rocklea may be a bad investment, but that there's no way of telling whether it's a better investment than what you were looking at.
 
Hi,

I have been looking at units across the region in Sydney such as Rockdale, Strathfield, Campsie. I calculated briefly that if I buy 2br unit around $280-300K, with rental around $300/week, my monthly prepayment should be around $1000/month (allowing 2% interest rate rise in the next 2 years). In the long term, it is a good investment towards my super. I also know that there is a high demand rent for units that are closer to train station here is Sydney. However I have to leave room for $25-30K for any repair/fixing within the 5years span of the property. I just feel that the property market may head south once the Reserve Bank started to raise interest again.

I have been to Brisbane once & would like to retire there. When I read the stories of those who invest in Brisbane, it is very enchanting read.

Cheers
 
Having a second thought, I might 'hold' my searching for now. Home prices is at its peak in Sydney now due to the low interest rate. It is harder to find a good house below the $300K range.

Confusion & indecisiveness will prevail if one does not have a pre-determined investment strategy. Its the strategy that dictates where and what to buy. It sets your property selection criteria. Without a selection criteria all properties look the same....and there in creates the confusion & indecisiveness.

Food for though.
 
When I read the stories of those who invest in Brisbane, it is very enchanting read.

Been there - so many profiles are written about Queenslanders (eg, Reno Kings, Brenda Irwin) that it can seem like it's the only place to make money! And maybe there are some great opportunities there that aren't available elsewhere, but I doubt it.

Like Rixter said, determine the strategy first, and assuming that property is the appropriate vehicle, the location and property type will reveal itself.

*Attempts to practice what is being preached* :eek:
 
I just feel that the property market may head south once the Reserve Bank started to raise interest again.

TV2, if property prices head south what reason will the Reserve Bank have to raise interest rates? In reality the only reason the RB raises rates is to keep inflation in check. In your scenario if inflation gets out of hand (and rates are pushed up) you will be runover the top of if you are not invested in something.

Feel free to sit back and do nothing, you may regret your inaction in years to come.
 
Hi
I have been looking at houses near Liverpool, Campbelltown region. I can find houses which are close to train station/shops. An old house on a big block of land for under $300K, which I think is great potential. I still think it is wiser to purchase house. Having said all that, why am I reluctant to make a move now?

Five years ago I purchased my home for $340, and costs me $25K on renovating it. Today, it is worth about $370K+. Not much CG in 5 years. You can see why I have join this forum & do all the research possible.

Thanks for all your comments, they have been much helpful.

Cheers
 
Hi
I have been looking at houses near Liverpool, Campbelltown region. I can find houses which are close to train station/shops. An old house on a big block of land for under $300K, which I think is great potential. I still think it is wiser to purchase house. Having said all that, why am I reluctant to make a move now?

Five years ago I purchased my home for $340, and costs me $25K on renovating it. Today, it is worth about $370K+. Not much CG in 5 years. You can see why I have join this forum & do all the research possible.

Thanks for all your comments, they have been much helpful.

Cheers

I bought a near CBD unit/villa 6 months ago for $250k. Spent $10k on reno and it's just been revalued at $320k.
It's not about houses vs units.
It's about scarcity and desireability. Put those two together and you get CG.
 
TV2, what did you learn in 2005 that you can now use to help your decision? Did you overpay? Did you buy the best house in the worst street?

Gools
 
Units as set and forget, houses as ??

Being exposed to both units and houses, we like the unit experience of less paperwork and fiddling with minor repairs as opposed to the "whole of block" view of managing a house and land property.

Certainly we pay an owners corporation premium, but at the very least that evens out the bumps and over a period of time, despite strata operator fees, it can be surprisingly efficient.

Once we discarded the managing agents and sourced dependable tenants ourselves, we have a reliable stream and can go literally 6 or 8 months without a murmur, so we get that elusive "work-life-balance" we all seek.

Ultimately, action is its' own reward.
 
Certainly we pay an owners corporation premium, but at the very least that evens out the bumps and over a period of time, despite strata operator fees, it can be surprisingly efficient.

Not sure how it is in other states, but here in SA council rates are effectively capped for strata units/villas. So, despite having to pay body corporate fees, you end up ahead on the deal with very low council rates.
I've heard seminar presenters tell people not to but strata properties because of the strata fees involved. They always fail to mention that council rates are only around $600 per annum.
 
I've heard seminar presenters tell people not to but strata properties because of the strata fees involved. They always fail to mention that council rates are only around $600 per annum.

Also fail to tell you they cover repairs/maintenance to buildings and outside common areas, buildings & public liability insurances too.
 
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