The house vs unit debate is one of the most common investment questions GeeVee is asked. The honest answer: it depends on your strategy, budget and target suburb. Here is what the 2026 data shows.
House vs Unit: Investment Comparison 2026
| Factor | House | Unit |
|---|---|---|
| Median price (Melbourne inner-north) | $1,400,000 | $560,000 |
| Average gross yield (Melbourne inner-north) | 2.8 to 3.2% | 4.2 to 5.1% |
| 5-year capital growth (Melbourne) | +28% | +14% |
| Depreciation benefits | Lower (older stock) | Higher (newer builds) |
| Land content | High | Low to nil |
| Body corporate fees | None | $2,000 to $8,000 per year |
| Vacancy risk | Lower | Higher in oversupplied areas |
| Entry price | Higher | Lower |
When a House Is the Better Investment
- You have a budget above $900,000 and can access inner-ring Melbourne or Brisbane
- You want land content that drives long-term capital growth
- You are in a suburb with low unit supply (Ivanhoe, Hawthorn, Kew)
- You are targeting a family tenant demographic for stability and long leases
- You plan to develop or subdivide in the future
When a Unit Is the Better Investment
- Your budget is under $700,000 and cash flow is a priority
- You are buying in a high-yield suburb (Preston, Dandenong, Liverpool NSW)
- You are an SMSF investor needing lower entry price and positive cash flow
- The suburb has a strong professional or student rental market
- You want higher depreciation deductions in the early years
The Hidden Third Option — Blocks of Units
Blocks of 4 to 6 units on a single title are rarely discussed but offer the best of both worlds. One purchase. Multiple income streams. Land component that grows. Yields of 6 to 8% are achievable. Most trade off-market. The Collings portal specialises in these. Sign up free at collings.com.au/portal.
Frequently Asked Questions
Do houses always outperform units in capital growth?
Not always. In high-demand inner suburbs with limited new supply (Fitzroy, Northcote, Newtown), units have performed strongly. The oversupply risk is the key issue — suburbs with excessive new apartment development can see unit values stagnate or fall.
Are units good for SMSF investment?
Yes, in the right suburbs. Units offer lower entry prices, higher yields and depreciation benefits that can reduce taxable income inside the fund. Avoid high-rise apartments with large body corporate fees and high vacancy risk.
What is the best suburb to buy a unit for investment in Melbourne?
GeeVee’s top-ranked unit suburbs for yield in Melbourne in 2026 are Preston (5.1%), Dandenong (5.8 to 6.4%), Reservoir (4.9 to 5.3%) and Heidelberg (4.8 to 5.1%). All have strong tenant demand and manageable body corporate fees.
Find Investment Properties Off-Market
Whether you’re buying your first investment property, building a portfolio, or exploring SMSF property investment, the Collings Property Platform gives you access to off-market opportunities, portfolio tracking, investment tools, and property insights powered by GeeVee AI. Join free today and start building your property future. collings.com.au/portal
Find your next property with Collings
Track suburbs, get matched to on-market and off-market listings, and manage your whole property search in one place. Access the Collings property portal.
