Apartments are often the target of first-time buyers looking to get on the property ladder and empty-nesters seeking to downsize after raising a family.
Both these groups will be happy to learn average values of apartments are recalibrating, dipping 2.3% nationally over the past four months.
With almost 80% of the apartment stock, cities are seeing the biggest corrections.
According to industry researcher CoreLogic, their values have dipped 2.7%, while those in the regions are steady at -1.3%. Looking across Australia, Hobart (-1.7%) and Sydney (-1.5%) saw the most significant one-month decreases in August.
If you own an apartment, you’ll be happy to know it’s still around 8% more valuable than before Covid hit our shores. Our agents say the price adjustment isn’t deterring sellers, and many great opportunities are coming onto the market.
Try these top 10 tips for buying an apartment:
Local amenities
Apartments near amenities such as restaurants and cafes will always gain value. Access to good transport and near schools, a university or hospital are also essential for a good investment.
Four questions
Is there good natural light? Can I hear noise from residents or the street? Can I open the windows for fresh air? Does the apartment have a pleasant smell?
Parking
Apartments with a secure parking space are sought-after regardless of market sentiment. It’s worth paying extra for a space because it will be an excellent investment when the time comes to sell.
Storage
It’s great to have access to storage space. Like parking, it’s another asset that will add value.
No wasted space
Make sure the apartment layout does not have a lot of wasted space: a corridor from the door to the living area is a classic example. You will want to use every square metre of your purchase.
Feel safe
Only purchase where you feel safe. Assess the apartment’s security so you’ll always be at ease. Find out if your neighbours are permanent residents or you’re about to move into a block of Airbnb rentals.
Strata fees
Don’t get carried away with a potential purchase until you’ve checked out the strata fees, usually charged every quarter. While you might be able to afford the asking price, can your cash flow handle the strata fees?
Facilities upkeep
If an apartment gives you access to a gym, swimming pool and tennis court, will you use them? One thing is for sure – you’ll be paying for their maintenance in strata fees.
Strata Committee
Apartments generally have a strata committee, or owners corporation, that oversees the property. Ascertain its financial strength to ensure it has funds to cover ongoing works.
Major renovation
Your due diligence must uncover any planned capital improvements. You don’t want a huge bill for your share of the work before you’ve barely moved in. It could be the reason why the seller wants out.