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VIC PPOR - House or unit

Discussion in 'Where to Buy' started by laziale, 12th Oct, 2016.

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  1. laziale

    laziale New Member

    Joined:
    31st Jul, 2015
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    3
    Location:
    VIC
    Hi all,

    Looking to buy a PPOR in Melbourne East, cannot decide between 2 properties in the same suburb - weatherboard house (2/1/1) or a brick unit (2/2/2 - block of 8). Both are quite similar in terms of price, age, building (~120sqm) and land size (~230sqm).

    Main differences are:
    1) unit has been recently renovated while the house will need kitchen and bath replaced at least.
    2) house has wasted land space around the building while almost all land around unit is the backyard.
    3) Strata fees (1k pa) for unit; obviously none for the house.

    My heart says the unit but my head says the house. Any thoughts?
     
  2. JacM

    JacM VIC Buyer's Agent Business Member

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    12th Jul, 2015
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    Location:
    Melbourne, Australia
    Hi @laziale

    A very good question and it will be an interesting debate given that the land size is pretty much the same.

    On the one hand, the unit is sturdier (brick) and sounds like it's in better condition.

    On the other hand, a unit is already in a strata so you're limited as to what you can do with the land later on.

    I don't much like weatherboard homes, and 230sqm is a bit too small to do anything much with in terms of subdivision / additional dwelling etc in terms of what current minimum land size requirements are for such things. However as time passes, councils tend to reduce the expected minimum lot size per dwelling. So in the future perhaps you can do something with it.

    Your age might play a big part in deciding on this one. If you're in say your early 30s you've got a few decades to see what happens with lot size regulations. If you're closer to retirement you might prefer a sturdier dwelling that isn't going to be as much of a maintenance burden or require immediate renovations.

    Watching the thread with great interest !
     
  3. Alfiesausagedog

    Alfiesausagedog Active Member

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    16th Sep, 2016
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    Location:
    Brisbane
    Hi there,

    I'm a complete novice here so please take my words with a hefty grain of salt.

    One thing worth considering is the house would likely have more opportunities to manufacture growth (through a renovation, adding an extra bedroom etc.). I often expect stronger capital growth from the house, however there are so many variables to consider it's not always the case.

    I understand they are both in the same suburb, however each suburb has sub markets which experience a varience in performance (some pockets of a suburb outperform others). Things to consider will be each properties' location in relation to nearby facilities such as public transport, schools, shops, restaurants, cafe's etc.

    All that said, considering it's your PPOR I would think about your mid to long term plans. If the plan is to stay in the property long-term, you'll generally look at things in a different light.

    You state your heart says the unit, is this because it appeals to you more from a long-term living perspective? If so, then perhaps this property makes more sense.

    If the plan is to stay here for a few years and then rent out the property as an IP, perhaps the house makes more sense.

    If I were you, I would consider shouting any willing local buyers agents a coffee and discuss the two properties with them, they might be able to shed some light.
     
  4. Big Will

    Big Will Well-Known Member

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    Location:
    Melbourne, Australia
    Without knowing any other details I would go for the house.

    As you get 100% of the land and you can build up or renovate, ways to manufacture growth.

    That is my quick 2 cents.
     
    JacM likes this.
  5. Colin Rice

    Colin Rice Mortgage Broker Australia Wide Business Member

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    Location:
    Perth
    On the surface and based on the info supplied I would personally opt for the house as you have a lot more control including a knock down and rebuild where a strata unit you can only improve the internal space.
     
    JacM likes this.
  6. The Y-man

    The Y-man Moderator Staff Member

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    Melbourne
    Also agree with above regarding houses being easier when it comes to extending and moving things around (eg kitchen/bathroom locations).

    Further:

    Remember in a block of 8 you will have a owner's corp, and you may get 5 of them go nuts wanting a glass driveway or something.

    If the house is a period home, there can be value in this factor alone.

    The Y-man
     
    JacM likes this.
  7. Marg4000

    Marg4000 Well-Known Member

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    Qld
    I would go for the house, provided you can make it liveable for the next 5-6 years without spending much.

    By that time it will probably be economical to knock down and rebuild.

    However, as it is for a PPOR then personal preference plays a part.
    Marg
     
  8. albanga

    albanga Well-Known Member

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    Melbourne
    The answer you seek is clear as day in the figures you provided.
    The unit newly renovated on the same size land with an additional bathroom and carapace is the same price as the house.

    This means if you renovated the front house, potentially extended ( which mind you can't be done to the unit) then how would values compare?

    It would blow it out the water.

    House everyday of the week.
     
    G TOWN likes this.
  9. JDP1

    JDP1 Well-Known Member

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    Brisbane
    I would let location drive the difference here. Unless they are next door to eqchoyher and location is a small differential.
    Often, even in the same suburb, one can be relatively inaccessible eg to public transport whereas the other could be within walking distance to pt and amenities.
    May or may not be the case here, my point is to use the precise locations as a differentiator if it can be used as such.