Comparing Units vs Houses for Investment

When it comes to property investments, both units and houses differ in terms of the potential for capital growth, rental yield, and upfront costs. While the specific investment potential of a property depends on factors like location, accessibility, and size, market data consistently shows overarching trends for apartment vs. house investments in Australia.

For new investors planning their first foray into the real estate market, knowing what to expect from a unit vs house investment will aid in putting a successful portfolio together.

Apartment vs House Investment

Upfront Cost of Investment  

Houses and units have different upfront costs for investors. The average house vs unit price across Queensland’s major regions shows a clear trend.

Data from realestateinvestar.com.au (November 2025)

The purchase price of units can be less than half that of a house (depending on location). As a result, unit investments provide investors with less starting capital access to property at a lower entry cost. 

Buying a house as an investment offers the option for buying an existing or building a new property. An existing house is typically located in an established neighbourhood and will come with a higher price point to reflect rental demand. On the other hand, new build can be cheaper to buy and can still command decent rent given it’s new, unused, and (usually) in an up and coming area. House and land packages are popular for this reason - the cost of both the land and property is included in the price, making it a cost-effective option for achieving a ready-to-move-in home upon completion.

Capital Growth Potential

Buying a house is more expensive because you’re also buying the land as part of the investment. Land is a limited resource and will increase in value over time.

Units do not have a land component, so the potential for capital growth has been traditionally limited.

However, this is not always the case - there are exceptions. According to recent 5-year market data on average house and unit prices gathered by the Real Estate Institute of Queensland (REIQ) for Queensland (March 2025 quarter), both units and houses have the potential to outpace each other in terms of capital growth. 

The median house price in Townsville has grown by 66.41% from $327,500 in March 2020 to $545,000 in March 2025. In the same period, the median unit price in Townsville increased by 51.26% from $238,000 to $360,000.

On the Gold Coast, where units are in high demand, the growth rate of apartment dwellings trumped houses. The median house price on the Gold Coast experienced a 5-year growth of 78.29% from $645,000 to $1,150,000, while the median unit price saw a 84.65% increase over the same period from $417,000 to $770,000.

The takeaway is that while houses have a higher capital growth potential, the region’s rental demographics and demand will have a significant influence on each property potential capital gains performance.

Average Rental Yield

Rental yield is the assessment of the property’s return in proportion to investment cost. Higher rental yield equates to better rental performance.

Units can perform better than houses in rental yield. Lower upfront purchase costs combined with high rent returns means a strong yield for investors.

Real Estate Investar data for the average rental yield of dwellings in Queensland shows a median gross yield of 4.4% for units and 4.1% for houses.

Ongoing Ownership Costs

Investment returns on both units and houses will also come down to ongoing costs. 

Units will be under a strata or body corporate scheme which means regular strata fees but also less maintenance costs (for shared areas of the building).

Houses can have higher costs involved in maintenance, repairs, and wear and tear. A newer property (like a house and land package) will hugely reduce repair costs involved. There’s also builder’s warranty for 6 years and 6 months after completion.

Final Thoughts

The overarching trends in investment potential for both units and houses are only a guide - looking at the specific factors in each location for rental demand, demographics, and housing supply will provide more accurate information to make an informed decision on what kind of investment property is appropriate.

For those looking to invest in Queensland’s rapidly growing regional markets, Builder Direct is an experienced investment home builder with a proven track record in building new houses that achieve long-lasting returns. Explore our investment-focused house and land packages in Townsville, Mackay, and Cairns to find the next lucrative addition to your portfolio.