Should you buy a house, or a Unit or Town House or Duplex?

Should you buy a house, or a Unit or Town House or Duplex?

It seems to be a very common question when it comes to buying real estate, particularly for first and second-time buyers – will it be better decision to purchase a house or a Unit?

As a starting point, the factors that go into making this decision are mostly personal preferences.  These include whether the property is an investment or to be your residence, the location that you’d like to live in, how many people will be living in the property, what types of maintenance you are prepared to carry out personally, and so on and so forth. 

Investment vs. Primary Residence

Many investors find Units to be easier purchases for a number of reasons.  Units do not necessarily require the larger amount of external maintenance (e.g. gardens, pools) and attention that an individual house will need, and the building’s manager or Body Corporate will usually take care of most building and remedial work that is required.  However, having this advantage comes at the cost of body corporate fees  to the investor, which may have an adverse effect on the rental income that the property delivers. 

Investors should also consider the length of time they plan to hold on to a property for and the capital gains desired from the investment.  Using historical pricing as a guide, we have seen that both houses and Units experience value gains; over a short to medium-term period, houses and Units appear to show similar price gains, however over the longer term houses may see larger growth in value. 

For investors, rental potential and income are other factors that require consideration.  Many real estate agents believe houses to hold appeal for a larger market of renters, including families with children and pets, who may steer clear of Unit living.  Houses also often allow a higher rent to be charged. 

Having said this, however, price is obviously a factor that will be of pertinence to many buyers, whether purchasing as an investment or home.  While some Units can be more expensive than houses (e.g. penthouses with water views in costly suburbs), in general terms, houses are usually the more expensive purchase, especially if you are comparing properties in the same area.  Units therefore may be a more friendly purchase option, especially for first-time buyers.      

Location & Space

High density housing is commonly found in city areas and suburbs that are only a short distance from the CBD.  Thus, if you desire an inner-city lifestyle, a Unit may be the best property option.  However, if you wish to live further away from the city and have enough room to accommodate several people including children and pets, you may find the extra space (both internally and externally) that a house usually provides may be more appropriate for your situation. 

In the end, the choice between an apartment and a house very much comes down to your personal circumstances.  By thinking about your needs and thoroughly researching the property market at the time you wish to buy, you should be able to reach a decision that is suitable for your situation.