Why are houses with no development potential more expensive than apartments?

I know that generally, houses are more expensive than apartments, even with the same bedrooms, bathrooms and floor area, because of the land content. This represents the potential change of use down the track which means a developer could pay big bucks.

Like my parent's place, which has gone up hugely because it could easily be knocked down and 2 units built in its place - the value is the potential to do that.

But what about for an inner city terrace which is strictly controlled, no extension or redevelopment potential. It would still go for twice the price of an apartment of the same size and features.

Is it all just "character" premium that people want to live in a terrace, and I guess a "no body corporate" premium added on? Or do people have a stigma against apartments that they will never live in one, even if larger and cheaper and nicer and better located?
 
But what about for an inner city terrace which is strictly controlled, no extension or redevelopment potential. It would still go for twice the price of an apartment of the same size and features.

Is it all just "character" premium that people want to live in a terrace, and I guess a "no body corporate" premium added on? Or do people have a stigma against apartments that they will never live in one, even if larger and cheaper and nicer and better located?

A combination. No body corp. The fact that you don't have neighbours above or below you. You get a yard. And terraces are 'cool'.
Alex
 
Hmmm.. But many ground floor apartments have a courtyard....which admittedly doesn't usually have grass. But then most small terraces have a paved yard as well, no grass.

I'm talking a really small terrace - like 80 sqm. Take Carlton, a little workers cottage like that would be in the 600K range. The same size apartment, with a courtyard, same area, 450K. Is it 150K just not having to deal with body corp hassles?

I guess my point is a can't see the attraction to tiny terrace houses, I just couldn't see spending 600 when something so similar was there for 450? Perhaps someone could explain the appeal?
 
Well, I don't know Carlton from squat & don't know what you can & can't do there, but I would say that a terrace would win hands down for me every time, even if it was the same size as a courtyard unit.

The benefits include the lack of neighbours above & around you. The possibilty of renovating it to my wants, which may/may not (depending on Council) include the possiblity of going upward. The fact that I can control my desire for pets without having to ask permission. I can paint the outside to my liking.

In short, no Body Corporate, means I can do pretty much what I want to do with my own home.
 
For me, having only ever had one body corporate experience, I avoid anything where anybody else has a say in what I can and cannot do and/or spend on my own place.
 
I don't think it's even about extra freedoms without a body corporate. It's the IDEA that you can do whatever you want. You may not want to paint your semi in purple and pink zebra stripes, but you CAN. That ability to do it, even if they don't, is worth a lot to people.
Alex
 
It's the old supply and demand at work - terraces are trendy, aren't being built any more so there is a finite number out there.

And they are hugely popular, so the price goes up.
Marg
 
Because people are grumpy, they don't like being told what to do - especially Ozzies, and they very much like their elbow room....it's the number one thing people fight about in a domestic communal situation - see fence disputes as an example.

I think the cost issues of Body Corp are not the reason, as items such as funds for upkeep of grounds, building insurance and so on form the bulk of the expenses and are all incurred by the green titled townhouse, so both situations need to fork out for those expenses.

It's only the swanky pools, gyms, high maintenance elevators on high rise and like that differentiate between the two, cost-wise.
 
It's only the swanky pools, gyms, high maintenance elevators on high rise and like that differentiate between the two, cost-wise.

I agree with this, but it is not only the high end stuff that can cause headaches. The one and only time I had a unit, it was in a suburban brand new block of five. Split up was the front unit, three floors including its own double car park with internal entrance. The other four units were single level with garages under, just like a normal six pack.

Don't know if this was usual, but back then the front unit had at least two votes. (I seem to recall the split up was dependent on the number of toilets, of which he had three, and the rest of us had one per unit, but this may be my memory playing tricks.)

Anyway, divorced foreign chap in the huge front unit with two kids wanted the driveway dug up and relaid because water puddled a little in a low spot. Because he had two (or possibly three) votes we had a bit of a battle saying "no" to him.

It was a battle, he didn't get his new driveway which was going to cost us all thousands of dollars and once we sold that unit, I have never wanted to get into battle with another body corporate, so we stick to houses.
 
"Why are houses with no development potential more expensive than apartments?"

Reasons:

1. there is development potential in them; but it's already been used by the developer who sold it to the next bunny. ;)

2. people are stupid enough to keep paying massive gobs of money for them.
 
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