I speak with a lot of clients who ask me why they should be buying an apartment. Really the question is why wouldn’t you!
The demographic shift in Australia over the last century has seen the household size shrink from 4.5 people in the early 1900’s to under 2.5 people in recent years and predicted by the ABS to reduce even further over the coming decade.
Shrinking household sizes is due to a number of factors including: - People moving out of home sooner - Elderly population increasing - Higher Divorce rate
Today, most people actually prefer to live in apartments. We live in a more efficient world which means apartment living is more desirable. You live closer to shops, schools, transport and other community amenities when you live in an apartment. This is what is demanded from tenants and from first home buyers. The low maintenance nature of apartment living is very attractive to tenants.
In recent years, RP Data have reported that apartments have experienced a higher capital growth than any other type of dwelling. That coupled with higher rental returns for apartments makes this type of property most desirable for investors.
Now depending on the location you buy in, this will determine what size apartment you should buy. A 3 bedroom apartment close to the city might not be the best investment and likewise a 1 bedroom on the outskirts of Sydney may not be either. When looking for a property, you need to research the demographics of the area to work on what property type will be most in demand. This will help you when it comes to finding tenants that will pay a higher rent plus when you come to sell, there will be more people wanting to buy your property thus pushing the price higher!
Once you have found your desired development to buy in, many of my clients ask me about which level is best. There is really no right answer as every project is different. In most cases we recommend to clients to buy an apartment on one of the middle levels unless there is something unique about a ground floor or penthouse level apartment.
As a long term investment, apartments will stand the test of time based on future predictions of demographic shifts. With the population increasing, people are looking for desirable apartments to rent in high demand areas that cater for employment hubs, transport, schools, parks, shops and more. The apartments that I show my clients tick all these boxes and more.
If you are looking to buy an investment or a first home… consider an apartment. Talk to me about the benefits available to off the plan apartment buyers currently available.