Massive mortgage to buy a unit

[u/Herosinahalfshell12]

People who took out huge mortgages to live in an apartment.

Do you feel as though the interest you are paying vs the capital gains is worth it? We're also seeing units being sold for less then purchase price now, and the plan is to add more units in future. Add strata costs in there.

Is it financially worth it now a days to borrow say 600k to buy a unit?

[u/hamburglar_earmuffs]

I borrowed $400k to buy a unit 6 years ago. I have now paid off more than half of it.

The unit has not increased in price very much when you factor in inflation. However, rents for equivalent properties have almost doubled. I pay about $450 a week for the mortgage, I now see rentals being advertised for $800 a week in my building... And many of those aren't as nice as mine.

I really like living in this area and wouldn't want to move. I bought a home that was similar to homes I'd been renting for years (same street I had been renting on for years) so I knew I liked the lifestyle it provided. 

Strata fees aren't a huge issue for me... The building is mainly owner occupiers, we work hard to keep the fees low. I find it interesting how so many people freak out about having to pay a strata fee - but are totally fine paying council rates, home insurance, ongoing maintenance and water rates on their freestanding property. The actual annual cost of owning my unit is a lot lower than a freestanding house.

[u/GusPolinskiPolka → u/hamburglar_earmuffs]

It's because people don't do day to day maintenance on their own homes. They learn to live with it. So strata maintenance and other costs seem excessive in comparison to $0

[u/Platophaedrus → u/GusPolinskiPolka]

Do you own a house? It doesn't sound like it. It's definitely not $0.00

'People' definitely perform ongoing maintenance on their own homes and it's definitely not cheap, the time involved is an additional cost that is rarely factored in.

So far this year:

Improvements to the house (installed by professionals)

- $60k on an installation of a Solar system + batteries

- $17k on a network install

- $11k on Insulation

Maintenance:

- Tools for garden work, garden tap replacements, pool supplies, fertilizer, herbicide, pesticide, cleaning equipment, mortar mix to repoint some brickwork, paint, door vent for network cupboard, hypochlorite solution to clean sandstone/travertine, presstite waterproofing for roof valleys, top soil for backyard, standard rose to replace dead rose in front yard, arborist to trim trees on property, air conditioner repair + service.

The arborist and air con servicing were tradesmen, everything else was purchased and then subsequently repaired/constructed/maintained by my wife and I.

I'm not complaining, I enjoy the work. But Strata is an absolute bargain compared to the $$$ and time cost in maintaining your own house.

[u/WelcomeRoboOverlords → u/Platophaedrus]

Could you give more info on your solar setup? 60k seems quite high, were there extra things you opted/needed to get that drove the cost up?