Apartment living the way of the future?

I have a strong feeling that it is apartment prices that will substantially stagnate for a long time. Of course location/uniqueness takes precedence and some would go up, but as a whole apartment values should stagnate.

The cost of building is pretty high, currently approx $2500 per m2 for a typical high rise. So this will keep a reasonably high feasibility baseline (e.g. needs to sell at >$500 000 for a 2 bedder) for most areas that apartments should not drop below, except in a short term crash situation.

 

I wouldn't mind that but the only issue I have is they'll probably jack up the strata levy per quarter. I know that in a way it's a good thing that everyone contributes and can vote on each of the quote received, but feel that some strata managers do receive some kickbacks for selecting some people over others. To be fair, I can't say that my strata living has been too terribly bad at all with pretty good neighbours but the strata levy been increasing each year and more than the rate of inflation of course.

 

There is an 8 storey apartment block being built at Warners Bay at the moment with another site sold [BP service station] sold with plans for another apartment building. Was told by local REA that plans are afoot for the shopping centre to be re-developed into multi-storey block with shops [Woolies & Coles] on the ground floor and apartments above.

Will change the landscape in what was a quiet corner of the world into high rise, a first for a suburb on the shores of Lake Macquarie except for Belmont which is a developing high rise suburb and moving forward fast ...

 

I would love to live in an apartment right in the CBD. My problem is finding one that accommodates the 5 kids...........

 

Box Hill does at least have a shopping centre over it - but that's the only example I can think of

 

Still plenty of big open parks and green areas all around the city. Plenty of houses with backyards to play cricket in too, they haven't all disappeared! Anyway, the kids of today will be remembering their childhood by how long they spent indoors playing WoW or GTA

Friends, Big Bang Theory, HIMYM, GoT, Sex in the City etc are all set in apartments and have exposed the current batch of Aussies to that way of living as being acceptable and the new norm. Most my friends prefer renting units as they're apparently a lot less effort to maintain.

 

Boarding school

 

I would say, in general we will see a much greater proportion of apartments as a % of total housing. It's really a function of people wanting the benefits of density and proximity. Houses will always be there for those who either are prepared to pay for them or who are prepared to live far enough away from dense areas.

My prime focus of investment is the Gold Coast which has a greater % of apartment living than any other city. From an investment perspective we will see massive appreciation of the value of Gold Coast houses over the coming decade for the simple reason that the total supply vs apartments will continue to shrink and further due to the development potential of the underlying land.

 

For apartments location is a absolutely key if you are seeking a capital gain. This is the lesson learned from apartments in any country be it NY, HK, Gold Coast, Sydney.

 

Grew up in Australia with big backyards (& still own one) but the last 20 years have lived in small apartments (less than 50m2) in US, UK, Switzerland and Spain. Now I live in one of the most densely populated suburbs in Europe, 21000 people per km2. But with high rise you sometimes get a view, this is similar to the "spacious backyard" feeling. I have always had fantastic views (now in a top floor attic), a view is worth a lot in lifestyle terms, to me anyway, and can be a major advantage of high rise apartment living.

As far as investments go I´ve had 6 properties, 3 houses, 3 apartments. The apartments have been the better investments in terms of both income and capital growth.

 

I agree entirely. I have seen exactly what happened in HK. If you have a limited geographical space and ongoing demand to live in the space apartments boom in value (and of course pure land owned by developers even more). The closest I can see to HK in Oz is actually Gold Coast, with the limited geographical space being proximity to the beach. Is a matter of economics and understanding human nature. Big money for those who get this ...

 

Say what...the closest to HK in Australia is the gc.?
That's like saying Perth is going to double in the next 2 years and leave Sydney and Melbourne in its dust

 

Ormond will have an 8 storey block above it, lots of local nimbys going crazy though. But it makes sense, gets the government a bit of cash back after all the rail works too.

 

Personally I don't think this will be the case - at least not in our lifetime.

The fundamentals of most people migrating to Australia (and people living here already) is still socially driven and purely for lifestyle - people want the clean air, lots of space, quietness, security and a house with a backyard for a dog, kids, bbq etc - all lifestyle decisions. Granted the 1/4 acre block may be obsolete, but I see the 'acceptable norm' shifting towards small blocks, townhouse/villas or modern terrace housing (if it hasn't already).

Everyone I know living in apartments now for affordability are there only as a temporary step to get into a house. Whether they can achieve this financially is a different matter but when these fundamentals become too unachievable or jeopardised, staying in Australia will become less attractive

Unlike Hong Kong/New York, people are not moving to Australia to make money (in fact, our talent are leaving our shores to go overseas for better opportunities, more pay and less tax). I go to Hong Kong at least once a year and just got back from New York - I really don't see how Sydney/Melb will ever become anything like these behemoths. The economic drive, govt. policy and population demand just isn't there...

 

Yep - GC has the highest Percentage of apartment residents vs houses in Australia. By far. Also has the densist suburb population per sqm I believe (Surfers Paradise). Some might not say this a good thing - but I'm citing it as a future trend that in some parts of Australia is already well underway.

 

Interesting perspective. I would say that many of those who are moving here from overseas are white used to apartment living. Buyers from HK, China, Singapore, Europe etc. Further many are realizing that you can have "space" simply by walking out of your apartment building - where you have parks, public spaces, beaches, malls, mountains etc. and further they desire the security and the facilities apartments offer.