Monday, March 3, 2008

Boom in small units

Article: The Sunday Telegraph

By Sharon Labi

March 02, 2008 12:00 am

RISING rents, the most volatile sharemarket and single people have fuelled a resurgence of the unit one-bedroom market.

Agents say one bedroom - once the hardest to unload properties - are sold in the two weeks following its inclusion on the list.

Australian Property Monitors CEO Michael McNamara said Australian Bureau of Statistics figures show the number of people living alone is at its highest level and, consequently, investors are pushed onto the property.

Rental returns on a unit one-bedroom units purchased for $ 250000 to $ 300000 investment makes them attractive, he said.

Keith Soames agent James Campbell said one-bedroom attracted rents of $ 300 to $ 340 per week and are sometimes the only option for those seeking to enter the market.

"If you are going to be paying more than $ 300 a week in rent, you can buy,''said Campbell, adding most of its buyers were women in their 20s.

He sold a unit in a bedroom in Hornsby on Tuesday of $ 280000, with the buyer made the rent for six months at $ 310 per week to make a dent in his mortgage before moving in.

Lesley John Spence of Spence Property sold a one-bedroom unit Carlton for $ 285000 on the day of his first visit and said that there was not much on the market, particularly around the price range $ 300000.

"The best market for the property, the more buyers you have to work with, so there are certainly people who, if they can afford to buy, must start somewhere and that the item would be one unit one bedroom,''she Dit.

There was also a growing tendency for people to live alone.

Susannah Anderson, of Di Jones in the Western suburbs of Sydney, said there was a large single market of a few, but a bedroom.

"Towards the end of last year, a room really started creeping up to the $ 300000, the low $ 400,000 (to the east), whereas three or four years ago, a two-bedroom was $ 400000 and now is the price of a bedroom one.''

Residex head John Edwards said investors were still buying rooms because they are relatively affordable.

"But an investor to own a unit one bedroom has a much higher level of risk than owning a two-bedroom unit, because how many people can live in a bedder?''

Profitability highest enjoyed by developers for the construction of a bedroom as large businesses, but the construction has slowed right down, "said Edwards.

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