When it comes to purchasing a property, most Australians prefer a house with more than one bedroom – in fact, the more rooms, the merrier. But, is this the right approach?
Some quick facts
- If you’re looking for a one-bedroom apartment, you can typically find them in high-rises. 25% of the units in high rises in 2001 were either 1-bedroom apartments or studios.
- Houses are much less likely to have fewer than three bedrooms, with only 13% fitting that bill in 2001, according to the Australian Bureau of Statistics.
- The demand for studio and one-bedroom apartments is on the rise, with census data indicating a 50,000 increase from 2006 (317,000) to 2011 (363,000).
Is it actually a good idea to buy a one-bedroom property?
There are numerous advantages linked to the purchase of a one-bedroom property, related to price, neighbourhood, smaller expenses, good parking space and privacy. Let’s see why you should reconsider this option, next time you’re browsing for houses.
Better neighborhood
Typically, one-bedroom houses have smaller prices in comparison with two-bedroom properties. In some neighbourhoods, the difference can be quite significant. Official data informs us that a two-bedroom house located in Sydney is estimated at $1.13 million, while a one-bedroom apartment is worth $655,000. As you can see, the discrepancy is pronounced. In Melbourne, a one-bedroom flat costs about $335,000, 63 percent of the price of a home with two bedrooms. Therefore, we concluded that, due to the price difference, you could purchase a unit in a more desirable area, in the case of a smaller house.
Lower strata fees
When you select a one-bedroom apartment, you save money on strata fees and levies as well. That’s because these fees are typically calculated according to the residence’s floor size.
You benefit from better yield
Did you know that one-bedroom houses have a better yield as opposed to properties with more bedrooms? According to the data gathered by www.realestate.com.au, a one bedroom apartment in the central area of Brisbane has a yield of 6.98 percent, while a two-bedroom flat has a yield of 5.82 percent. It’s true that smaller properties don’t experience a flourishing capital growth, as opposed to houses with more bedrooms. Still, there are other advantages related to the first category – including excellent parking spots, and entertaining possibilities.
You can still have a backyard
Even though the vast majority of one-bedroom properties are flats, that doesn’t mean you cannot dream of having a garden or terrace of your own. There are numerous one-bedroom townhouses, which are established particularly in the larger cities. Plus, what is even better about these buildings is that they have a personality, being distinguished from other properties. In addition, if you’re browsing for houses, in time, you might consider the alternative of adding an extra bedroom.
You needn’t worry about hosting the extended family
If your house doesn’t come with more than one bedroom, you’ll always have an excuse for whenever the in-laws decide to crash. So, more privacy for you and your partner – sounds cool, doesn’t it?
A bigger deposit might be required
There’s one main disadvantage linked to small properties. Namely, lenders and banks tend to have stricter lending restrictions. That means you’ll need to have a deposit of 20 percent, or bigger than that, for a property that is smaller than 40 or 50sqm.