There are benefits to buying smaller dwellings such as units, townhouses and villas as they generally required less capital to purchase and were often positioned amongst stronger infrastructure.
When looking to break into the property market, there are a myriad of particulars to consider. Your list will include where and what to buy, often leading to some confusion about which kind of property will be the right fit.
How much capital
Where investors can buy is often determined by how much capital they have to contribute to their mortgage. Dependent on location, a unit, townhouse or villa could be a cost-effective option for those investors looking to swiftly add a new listing to their portfolio or simply enter the property market for the first time.
If you’ve got limited capital, then you are probably going to go to something cheaper which is, for the most part, going to be a unit or a townhouse as opposed to a house. However units were only good for investors so long as the strata fees are realistic and the building itself is in good condition.
Avoid the fancy stuff
While investing in smaller dwellings could indeed be a cost-effective way for new investors to enter the market, this is only true so long as investors don’t aim for the “flash stuff”.
Don’t aim for the “flash stuff” where there are gyms, pools and the concierge downstairs. You’ve got the associated costs with that which pushes the strata fees up.
Distance to infrastructure
Employment and infrastructure are two of the underlying factors to an investment’s success In comparison to houses, units, townhouses and villas were often located close to popular city hubs and had access to better infrastructure.
The properties that rent out really well and the ones that push up in value quite significantly are the ones that are very close to railway lines and very close to the shops. Distance to this infrastructure would determine tenancy stability.