Apartments are often the target of first-time buyers looking to get on the property ladder, investors targeting a strong return and empty-nesters seeking to downsize from the family home.
If you have been considering purchasing an apartment then you will be happy to learn the average values 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. We aren’t seeing these price adjustments deterring potential sellers with many great opportunities coming onto the market.
Try these top 10 tips when buying an apartment:
Local amenities
Apartments near amenities such as shops, restaurants and cafes will always have appealvto lifestyle buyers. Access to transport and proximity to schools, a university or hospital are also key attributes to consider for a good investment.
How does it ‘feel’
Is there good natural light? Can you hear noise from other residents or the street? What is the outlook like? 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 is practical as well as aesthetic. You will want to use every square metre of your purchase and a clever floor plan will create a space that is functional and beautiful.
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 concierge service, 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 and try to get a sense of whether there is stability/harmony amongst the owners.
Major renovation
Your due diligence must uncover any planned capital improvements. You don’t want a surprise bill for your share of the work when you’ve barely moved in. Major works aren’t always a negative if they will improve the building moving forward, but should be taken into account in your purchase price.