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Are apartments more risky than houses?

By Staff Reporter
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Simon Pressley, Propertyology

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Risks associated with buying into apartment markets - there's really no greater risk in apartment buying than there is detached dwellings or houses. There can be good areas for investing in apartments and good areas for investing in houses. What's important, I think, for locations where there's a lot of apartments is just to be mindful of the zoning in that area. Look up at the sky and see how many stories they can go up to. It's possible to have an over supplied apartment market, either at the time of investing or in the near term, but the same thing can occur when you're investing in houses as well if you're getting too far out of town and you're getting into green field locations. So avoiding over supply is important. If you're going to invest in apartments the specific complex is worth considering as well. We particularly avoid large complexes with anymore than about 20 - 30 apartments in that on complex, and we look for low maintenance complexes. So try to avoid things such as swimming pools, lots of lifts, etc. because these become big capital expenditure items.

Listen to other instalments of The Smart Property Investment Show:
Episode 71: How this investor complements each property and balances his portfolio
Episode 70: Special episode: buyer’s agent answers more listener questions
Episode 69: Are you a ‘lazy’ investor? Consider the benefits to working with a financial team
Episode 68: Special episode: audience discussion live from the Property Buyer Expo
Episode 67: Don’t get ‘caught up in the now’: an expert reveals his tips for success
Episode 66: Wealth distribution: how should you manage your money?
Episode 65: Real estate agents: what separates the good from the bad?
Episode 64: How this investor learned from a property blunder
Episode 63: Q&A session: the SPI team answers your questions
Episode 62: Property procrastination: the importance of finding help
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