AAAThrough June, the cheapest homes in Sydney were valued at slightly over $600,000 each this year, making even the lowest-priced houses in the greater Sydney metropolitan area more expensive compared with other assets, according to Eliza Owen, a commercial property research analyst at CoreLogic.

Meanwhile, in the heart of Sydney’s central business district, more than 80 offices sold for less than the bottom 10% of Sydney’s cheapest houses, ranging in price from $87,000 to $604,000 – for an average of $380,363.

Small commercial spaces are relatively low in value for a number of reasons. “Investors in commercial property are highly dependent on rental yield, rather than capital growth — and the initial price reflects these expectations. Whereas the lowest tenth percentile of Sydney houses saw capital growth of 11.4 per cent in the year to May, capital growth in commercial properties is typically more subdued,” Owen said.

According to Owen, the lowest sale value was a room in 229 Macquarie Street. At a mere 26sq m, the property was sold for $87,000 in July 2016.

The cheapest office sales were in the business centre: Macquarie Street, King Street, and Sussex Street. Meanwhile, five of the 10 cheapest sales came from  Sussex Street, a 10-storey building established in 1973. This building is just minutes away from a number of notable landmarks.

“The cheap office units sold over the year in the Sydney CBD are in high-rise commercial buildings, with an average floor area of 47sq m. The minimum floor space for one bedroom apartments in NSW is 50sq m,” Owen said.

Their relative affordability aside, are these offices a great investment? Given their small size, the per-square-metre price isn’t exactly cheap. However, like any investment, it’s about paying the right price for the right return – and some of these low-value office spaces have great rental yields.

“The highest rental yield associated with a transaction over the year was 6.7 per cent on a 51sq m unit sold for $475,000 . Depending on the terms of the loan for the property, such an investment is likely to be positively geared, Owen said. “Assuming demand for offices in the Sydney CBD is driven by strong economic performance, such purchases could present good investment opportunities.”

M. Mata, “Offices in Sydney more affordable than houses”, Your Investment Property, 2017. [Online]. Available: [Accessed: 27- Jul- 2017].