Securing a low-risk, high-return rental investment in Australia is a goal for many property investors and the question of townhouse vs apartment as a solid choice is something many of our clients ask us. We have put together this online snapshot to offer a guide on some of the many options available for your first, or next, investment choice. Read on to learn the advantages and disadvantages of both options and what else there is to consider when investing in real estate.
What Is A Townhouse And What Are Apartments?
Firstly, let’s give a brief overview of what these types of properties are in Australia.
- Townhouses: Think of these as a blend between single-family homes and apartments. They are typically multi-storey dwellings with private entrances and, in some cases, private yards. A common wall is shared with neighbouring dwellings on one or both sides.
- Apartments: Individual units within a larger building, often referred to as an apartment complex. Apartments share common areas like hallways, lifts and amenities and may be located on multiple floors.
Townhouses
Pros:
- Greater Privacy: Private yards and separate entrances contribute to a more independent living experience for tenants.
- Potential for Higher Appreciation: Limited land availability in some areas can drive up townhouse values over time.
Cons:
- Higher Upfront Costs: Generally more expensive than apartments.
- Increased Maintenance: You’ll be responsible for a larger portion of the property, potentially leading to higher maintenance expenses.
Apartments
Pros:
- Affordability: Lower purchase price compared to townhouses, making them a good entry point for new investors.
- Lower Maintenance: Shared common areas ease the burden of maintenance responsibilities.
- Potentially Higher Rental Yields: Lower purchase prices can translate to higher rental income percentages.
Cons:
- Limited Privacy: Shared walls and common areas can lead to noise concerns.
- Less Control: Greater restrictions and regulations may be imposed by building management.
Other Property Type Investment Options
When it comes to deciding which is the right investment choice for you, you need to consider not only townhouse vs apartment, but also townhouse vs house and house vs apartment. Here’s a quick snapshot of how a house and land package differs to both options already explored in this blog:
Pros of a house investment:
- Customisation: You have complete control over the design and layout of a stand alone dwelling when building.
- Privacy: Tenants can enjoy the seclusion and independence of a detached property and private full-sized yard.
- Potential for Higher Appreciation: Over time, detached houses can appreciate in value more than attached dwellings.
- No Strata Fees: You won’t be subject to common area maintenance fees.
Cons of a house investment:
- Higher Upfront Costs: Land prices can be significant depending on the location and building costs can vary widely.
- Maintenance Responsibilities: You’ll be responsible for all exterior and interior maintenance.
For a full overview of our investment property deals and packages: Click Here
Your Next Steps: Get In Touch With Us
Navigating the property market can be challenging and choosing which is the right investment choice for you can get overwhelming. At Positive Income Properties, we simplify the process and guide you every step of the way by helping you understand your options so you can make an informed decision for your personal circumstances. Our team’s extensive knowledge means we can tailor our services to fit your unique goals and provide a stress-free experience. Contact us today for a free consultation.
Gil Elliott is the Managing Director and Founder of Positive Income Properties. Gil has a rich background in business consulting and property investment. All of these he gained in his nearly four decades of experience in the real estate and marketing industries.
