Comments on: Are Units As Safe As Houses?

By: David

David — Mon, 28 May 2018 03:01:38 +0000

True just be careful there is already a healthy sinking fund in place. The first place I purchased , for $49,000 had no sinking fund. So as a young 22 year old who paid all his savings as a deposit you can imagine my horror at having to fork out $2,500 for upgrades to the roof and common areas.

By: Tim

Tim — Fri, 13 Apr 2018 01:56:37 +0000

HI steve,

Great article, I would like to buy a house but they are expensive, I have 3 units off the plan and all three have gone up around 20-25% with 5.5-6.5% cashflow positive. Strong demand in desirable locations.

I think the long term should be quite strong for units, I agree you have to be very careful which unit you buy though.

By: Steve McKnight

Steve McKnight — Thu, 12 Apr 2018 23:27:36 +0000

Hi Codie,

I’m not sure you have picked up on the gist of my article. Nowhere do I say that units, or houses for that matter, in and of themselves, make good investments. As for cities, you would need to revert back to my recent analysis for those I regard as having ‘tailwind’ and ‘headwind’ conditions.

My goal in the article is to help readers to see that a trend is emerging, one I expect will continue, that normalises unit ownership. As investors, if we can pick up on trends and exploit inefficiencies, then we can make profits.

Regards,

– Steve

By: Steve McKnight

Steve McKnight — Thu, 12 Apr 2018 23:08:05 +0000

Indeed. Due diligence is always needed. Thanks for the post.

– Steve

By: Steve McKnight

Steve McKnight — Thu, 12 Apr 2018 23:07:32 +0000

I agree! I think houses hold lots of opportunity, but the point I wanted to make in the articles is that units are becoming more and more popular.

– Steve

By: Steve McKnight

Steve McKnight — Thu, 12 Apr 2018 23:06:44 +0000

Great contribution Jules. Thanks for making it.

– Steve

By: Jules

Jules — Thu, 12 Apr 2018 21:51:36 +0000

Having recently sold my unit (in a 6 pack) in Brisbane, Paddington near transport, shops, cinema etc was a wonderful location and home, however due to the Committee of the Body Corporate making decisions not in the collective interest of all owners and goodwill of neighbours, placed the Committee in an unworkable situation with minority views and control which eventually led me to selling.

Please perform due diligence on the Body Corporate (Strata) carefully, meet the committee and examine AGM & Committee minutes carefully. Check if the Body Corporate is being controlled by a minority of lots.

Importantly ask if anyone on the Committee has a conflict of interest i.e. is related to the builder or developer and holds an executive position on the Committee.

By: Codie

Codie — Thu, 12 Apr 2018 13:27:50 +0000

Hi Steve, is it fair to say your generalising in this post? And apart from Sydney, every other market in Australia & the data doesn’t really support this. Obviously there’s markets within markets nationally & I’m Interested to hear your thoughts on Brisbane, Perth, and to a lesser extent Melbourne – given the supply issue and many approvals in the pipeline in Brisbane, it’s absolutely a buyers market with Unit medians decreasing. Melbourne lesser given the population increase taking up a lot of the supply. Until it’s forced & more widely excepted around other states, the data is still favouring land.

By: Ray

Ray — Thu, 12 Apr 2018 08:59:36 +0000

Thanks Steve,
As an investor I love reading and learning from those who have the runs on the board, I must say that I do like houses with yards as I see opportunity. Opportunity to either sub divide, add a granny flat and increase cash flow and capital, however as you have stated it’s about supplying and meeting the demand in relation to the demographics. I’m not against units but all in all, due diligence, due diligence, due diligence.

By: Marilyn

Marilyn — Thu, 12 Apr 2018 08:30:10 +0000

You really need to investigate the Body Corporate. Some of these units have massive admin costs. Older, smaller and usually ugly (but that can be changed) blocks have far lower costs. Also, number if units on block. If there’s six in the block you’re probably getting better land value than a block of 16