Banks measure Apartments smaller than builders !

BUYERS OFF THE PLAN SHORT CHANGED   Worth taking note of this if you are considering an apartment purchase…

“Banks usually baulk at bankrolling smaller apartments for fear of a reduced resale value”. – Herald Sun

2014-05-01 Apartment sapce doesn't Measure Up - Herald Sun

8 Responses to “Banks measure Apartments smaller than builders !”

  1. Barbara C. says:

    There are instances where apartments have been promoted with balconies included in the total area to disguise the true size of living areas.
    I am surprised at just how many apartments have been sold off the plan overseas, particularly in Asia, that are yet to be built in Doncaster, but when these buyers want to sell they can only sell on the local market, which makes me think there will be a huge mismatch between stock coming on the market and purchaser demand down the line. Apartment resale prices in the current market continue to be very weak, I know of a couple who bought a two bedroom apartment on Doncaster Hill more than two years ago but had to sell at a price 8 per cent less than what they had paid.
    Barbara C.

  2. Regan says:

    As to what sort of apartments are being built, developers are under pressure to produce small apartments. Particularly in the case of local developers, in order to gain the required bank financing for a high-rise apartment project, the developer must satisfy the bank that the proposal is financially viable. To this end, it is usually necessary for the developer to maximise the yield in apartment sales from the site. This is best achieved by producing small apartments the smaller the size the more that can be packed into the site, and for reasons noted above, the easier it is to sell the product
    Regan

  3. Friend of Whittens says:

    Most of the high rise apartments in Doncaster are being sold to overseas buyers because they are only allowed to buy off-plan properties, which has resulted in off-plan units being priced way above current market prices, so investors who know the local market will not be interested. The main reason is that they want to have some of their money outside their country. Their primary objective may not necessarily be to make a good investment, rather they are looking for a safe place for some of their money. Quite clearly, without overseas buyers, many of the off-plan projects in Doncaster could never be sold..

    Friend of Whittens.

  4. Regan. says:

    I am particularly concerned at the high number of small apartments currently being marketed in Doncaster. There is one development already completed in Doncaster Road that has 70 of its 158 apartments with an area of 50m2 or less.
    Research has shown that the vertical location of small confined apartments is directly related to a high level psychological strain experienced by residents. Of all the problems that beset apartment owners and take first-time high-rise dwellers by surprise, noise is the most common and varied complaint. Noise is accepted to be the fastest growing type of pollution in modern cities, and its effect on our mental and emotional health has a direct influence on our physical well-being. Exposure to noise has been linked to sleep deprivation, annoyance and health issues such as hypertension and heart disease. Living in a very small apartment is difficult enough and with excessive noise penetrating through windows, floors, ceiling, walls, doors and even through water pipes the experience can be extremely unpleasant. And even with adequate noise control mechanisms you will find noise issues in apartment living may still arise. Noise irritation is not just from people in an adjoining apartment. The building and external environment can be a rich source of noises, the types of noise that can drive you batty.
    While these tiny apartments are directed towards singles and couples, I am concerned that their lower price tag may also attract young couples with children.
    Regan

  5. Ajax. says:

    These 50m2 “gun barrel apartments”, with only one window to provide ventilation and natural light, were once aimed at people who couldn’t afford the skyrocketing rents. I recall the early days of the first vertical tenements for the poor, where dense populations were squeezed tighter and tighter until the living conditions became unbearable. Are social patterns simply repeating themselves? Are we headed in the same direction?
    Ajax

  6. Talford says:

    It is understandable why London has set a minimum size of 50 square metres for one-bedroom apartments given its circumstances. However Doncaster is not London but a residential municipality, more than 15km from Melbourne CBD, that has no infrastructure or employment. In fact Manningham City Council itself, currently employing a total of 665 staff of which 408 are full-time, is our largest employer.
    Talford

  7. Nino says:

    A recent survey of apartment dwellers in Doncaster identified some key likes and dislikes about apartment living.

    Top four likes:
    1. Lifestyle
    2. Proximity to shops and cafes
    3. Low maintenance
    4. Better safety and security

    Top four dislikes:
    1. Apartment size and lack of storage space
    2. Traffic noise and noise from neighbours
    3. Parking issues
    4. Owners corporation management fees to high

    Nino

  8. Kim says:

    The Doncaster high rise apartment plan is not child-friendly, nor particularly understanding of parents. The childless usually expect children to be quieter and better behaved than children normally are, and for parents to be able to exercise heroic control over them. Parents who live in apartments with children already feel guilty enough. People from Asia have happily survived childhoods spent in apartments, but here we think such confinement is akin to child abuse. Cantankerous neighbours who expect children to be switched off like a sound system or an air conditioner just add to parents’ stress.
    Kim

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