It’s on everyone’s wish list to get a place that meets their long-term needs. However, many factors dictate a property’s acquisition. There’s a lot to consider, from household income and budget to the property’s maintenance and location. Both buying an apartment and a house have their advantages and disadvantages. As a responsible investor, you have to do your due diligence to protect your financial future. Thankfully, we’ve compiled some significant differences between owning an apartment and a house to help you make your pick.
1. Price and location
Apartments are concentrated in the heart of metropolitan cities such as Desa Park City. This gives you greater access to transport, schools, restaurants, and other amenities. On the other hand, houses are less prevalent in the inner-ring suburbs, limiting your access to lifestyle attractions and employment. Suburban homes also cost more than apartments in the same locations.
However, if having a big yard and square footage is your priority, houses are more suitable. Lenders also have stricter mortgage policies when it comes to apartments in high-density areas. You might have to pay a deposit of up to 25 percent in some localities. Some lenders also blacklist certain suburbs that entertain an oversupply of apartments.
In the end, the choice of location boils down to your budget. Create a list of non-negotiable facilities and your price range, and see if you can narrow down your selection.
2. Maintenance and Privacy
One great advantage of buying an apartment is lesser maintenance costs. This is because of a particular contract called strata title. A strata title makes all renters in the building or complex pitch in for upkeep, maintenances, and insurance. Strata-tiled apartment owners have access to shared facilities, such as air conditioning, gyms, and pools.
As a homeowner, you’re responsible for maintaining your property. This means you have to mow the lawn, fix structural defects, and cater to any other maintenance job without outside assistance. If you’re not up for this, maybe you should rethink your options.
That said, a house provides more independence in terms of living. Lesser proximity to neighbors means lesser noise and distractions and greater privacy. This is one of the reasons why families generally stay in homes longer than apartment dwellings.
3. Property Value and Developmental Potential
Homes offer a better return on investment opportunities than apartments. Typically, homes appreciate faster compared to apartments in similar locations.
Apartment buildings have lesser value potential because they wear and tear easily because of multiple residents. In some cases, apartment buildings may need replacing altogether. On the other hand, houses are less exposed and offer a greater opportunity for value-optimization. Adding a room or bathroom or making minor upgrades can easily enhance the resale price of your home.
Apartment owners are not sole investors of the land their complex is built on and therefore can’t extend or rebuild. Even for cosmetic upgrades, they have to go through strata authorities, which limits control and autonomy.
Then again, apartments provide the potential for holding multiple assets. You can probably buy four apartments for the price of two homes in the same place. This could mean more rental income down the road and a more layered and diversified portfolio of assets, limiting your risk exposure.
4. Future Trends
Intelligent buyers don’t just look at current market conditions but also future trends.
The housing market has outgrown the apartment market in the past few years. Due to high demand and appreciation, houses have reached a point where they have become unaffordable and inaccessible for potential buyers. This trend is speculated to run its course.
So, if your ultimate goal is to sell your property for better returns, buying a house makes more sense. But, if you want a “home” for you and your family, and cashing out on your investment isn’t your immediate concern, buying an apartment is the better choice, considering your other non-monetary needs are met.
The critical takeaway is to stay in touch with the real estate world. Try to learn to analyze trends and housing data. The more self-educated you are, the more control and sense of peace you’ll have during the buying process.
Ultimately, buying an apartment or a house is about understanding your financial reach and preferences. Where do you see your family in the next ten years? What’s your household income? Do you have a young family that would need access to better schools and employment? Answering questions like these can help create a roadmap to the right choice.
The most important thing is to be thorough in your research. Consult as many reliable professionals as you can. You can schedule a meeting with a lender to evaluate mortgage options or sit down with a real estate agent to discuss capital growth. You may also want to make sure your finances are in check. Checking your credit score and redoing your budget will help set realistic expectations to actualize your ownership dream.
Once you have found the place that suits your needs, the next step for you to do is to contact an expert team of property valuers to complete a valuation on your next property to ensure that you’re paying its correct current market. Finding the right property for your needs can be a tough decision so it’s important to seek out a professional to ensure that you don’t have to deal with any more stress than you need to.