Does land size matter on units (not apartments) for capital growth?

Does land size matter on units (not apartments) from a capital growth point of view?

The benefit of houses on big blocks of land is that it can be used for multiple purposes and cater to not only home buyers but developers too.

However, what about units? To my knowledge, you can't do really do anything significant on the land such as a knockdown and rebuild or add another bedroom, etc.

Because of that do land size matter on units? And do floor area matter more instead?

 

If it is feasible to redevelop the block then certainly land can be of value but I don't think it is often factored into the price.

 

For townhouses it matters but it's not the driving factor for a buyer. The location, size, quality and price of the unit itself would influence buyer decision making much more. Of course given 2 identical units on 2 different sized blocks the larger one would probably sell for more. There's also an indirect relationship because usually the larger the block the larger the townhouse or garden all of which adds value.

 

land size is less relevant as the number of units in a block increases. 2 on a block is a lot better than 3 on a block. But 5 vs 6 is not much different as the chance of buying out everyone on the block is low. Also redeveloping often does not make sense as with 5-6 units the rent on existing units would be quite good and this value is destroyed if redeveloped

 

So when it comes to units, floor area matters more than land size?

A 200sqm floor area on a 250sqm land will be worth more than a 100sqm floor area on a 400sqm land.

 

I think it depends on the difference. If one has a courtyard of 12m2 and next door has 14m2.... I don't think anyone is going to care.

Sometimes though, the difference is huge. My unit has another carport, 2 sheds, a spa and a patio. Next door has none of that. Mine is without a doubt more valuable and easier to sell.

 

I think location is the number 1 factor when it comes to apartments. People will accept a smaller apartment in an amazing location, but the opposite isn't quite true. A large apartment is an average area is of course always a good thing, but it doesn't attract like location does.

 

Zoning is more important. If the current zoning allows more or less intensive use of the site, this will have a greater bearing on value.

 

even better is taking a bet on area which may be rezoned in the future as if zoning is already good the price is already built it

 

Lots of monash area now being rezoned. esp clayton parts off clayton rd towards the university

 

Where do you get your information on areas which are getting rezoned?

 

large size ( internal + balcony + yard ) means more strata levy, usually higher value comparing with smaller ones in the same block.