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Townhouse vs Apartment Development – What to Choose?

Posted 29 October 2019

If you are looking to develop and are unsure whether an apartment or a townhouse development is the best property choice for you, the team at Summit have narrowed down the key aspects to consider when making your investment choice.

An apartment is a self-contained dwelling within a larger building where several residents live together within the one residence.

A townhouse is defined as a form of terraced housing, characterised by shared wall/s, a small footprint and multiple floors.

If you have bought a block, in terms of finance, timeframes and return on investment and current market conditions, the cost of developing an apartment is higher in price and legalisation is more involved, meaning a townhouse is a better option.

In a smaller development, it is much more advantageous when weighing up between a townhouse or apartment property development to go with a townhouse project.

A townhouse allows a standard configuration of two-storey residences that are a self-standing development, as opposed to an apartment with common access

However, this is dependent on the block size and zoning.

Apartment developments in higher density and inner city suburbs are more popular because the zoning is higher, and in these areas you can justify the costs and building timeframes.

However, current market conditions show areas more than 3kms from the CBD are best suited to a townhouse development as opposed to an apartment.

Other aspects that are important to consider to maximise your investment returns include:


Allow you to make use of a large block
If you’ve got the land and it is in the right area, an apartment development will maximise the amount of dwellings you can build, equalling a higher investment return.

Buyer demand
Developments near the CBD are popular, particularly those within easy reach of employment hubs, shops and public transport.

If you are planning on keeping your apartment development as a longer term investment and will rent them out, bear in mind there are maintenance costs to consider for all tenants – not just one.


More spacious
You can build a bigger residence that offers buyers/tenants the benefits of modern living in a more traditional style home.

Take advantage of narrow lots
A townhouse plan is better suited to a narrower block and enables space to be optimised.


Thank you to Summit Homes Senior Development Consultant Ewan McConnell for your tips for this blog.


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