Cons
- Space: less area than a house.
- Price: more expensive than an apartment.
- Shared title: you are on a strata scheme.
- No individuality: townhouses are often the same layout and design as the neighbouring buildings and tend to lack individuality.
- Privacy: you have less private space than in a house and typically share walls with your neighbours.
- Land: smaller lot size.
- Stairs: townhouses typically span two to three storeys, which may not be suitable for elderly or disabled owners.
- Resale value: townhouses usually experience less capital growth than a house, roughly the same as an apartment.
Subdivided blocks
A subdivided block which may include either a standalone house or an attached dwelling is considered a unit due to the division of the land. Addresses will typically have a number or letter attached to street number, eg. 1/29 or 42B.
Subdivided blocks are a fantastic option for families, couples or downsizers who wish to capitalise on the option to buy a house in an area where full blocks are out of their price range.
Technically all urban and suburban blocks are divisions of larger parcels of land that have been split up and arranged into the streets and suburbs we know today. Over the years these blocks have been further subdivided into smaller parcels to accomodate growing populations. For example, it used to be common for blocks of land in Australian suburbs to be around a quarter of an acre or 1101sqm.
Blocks in many urban areas are trending smaller, especially those close to CBDs, but usually the suburb will have a standard size that is common for most dwellings.
Subdivided blocks will be smaller than the average block in the area, hence the more affordable price, which allows more buyers to access land.
Often these properties can share driveways, parking areas or other outdoor space and may or may not be subject to an owners corporation.
This option can be popular for those that are looking for all the benefits of a house but don’t have the budget or desire for a full block in the same neighbourhood.
Pros
- Price: Subdivisions will be cheaper than full blocks in the same area.
- Dwelling type: Many subdivisions have traditional free-standing family homes with all the individuality and space that comes with them.
- Ability to make changes: Owners can make changes to their dwellings as they would a standalone house provided it’s not part of the shared or common space, unlike owners of a strata title.
- Outdoor space: Subdivisions will often either have a front yard or a back yard or smaller versions of both, depending on where the house is situated on the block.
Cons
- Privacy: Some dwellings on subdivided blocks may be built close together and therefore privacy can be impacted.
- Price: These styles of units can be more expensive than townhouses in the same areas.
- Land: The land size will be smaller than a full block.
- Resale value: The resale value will be less than that of a full block.
Things to consider before deciding on a property type
When choosing between a house, subdivision, townhouse or apartment, there are a few factors to think about when it comes to making an investment:
- What can you afford?
- How big is your family?
- Will you need to upsize or downsize in the future, therefore spending more on transaction costs?
- Do you have pets that require outdoor space?
- Do you want to entertain outside?
- Is a garage essential?
- Would you like to renovate?
- Do you like living close to your neighbours?
- Do you mind sharing facilities?
- Do you know what a strata scheme is and is it something you’d be willing to deal with?
- Do you mind paying body corporate fees?
- Do you want to own physical land?
- Will you be a owner-occupier forever, or might you rent out the property?
- For investors: Will renters find this type of property appealing?
How to choose between different housing types
When it comes to buying a home, it’s important that you consider potential downfalls and bonuses of all types of property and choose the one that is right for you.
This includes whether your family will grow and if you will need more space in the future. Meanwhile, if it is an investment property, location might be more important than the size of the property.
Answering some of these questions before you buy should help you decide which property type is best for you, reducing the likelihood of making a costly mistake.