QLD $300k to spend! Rental Yield & Potential For Gains

Hi all, I'm looking at getting my first rental property.
-I would not be living in it at all, in an ideal world i'd like to have an area that would be able to get tenants very easily if needed... Yield doesn't have to be the best if there is abit more potential of property gain value to be had.

I would like to know what people would look for for around ~$300,000.
-I have been looking at closer to CBD area's/Brisbane Southside (Algester/Browns Plains/Acacia Ridge/Inala/Forest Lake etc)

If anyone would like to chime into ANY of the following and share their knowledge it would be extremely appreicated:
-Area's you believe have good tenancy rate's
-Area's you see good potential gains
-Property vs Apartment? (Body Corp Fee's)
-Quiet family type suburban area's vs Closer to CBD
-Is there any opinions also on old houses and when to steer clear, as i don't want to constantly be putting money out for fix-ups and constan repairs needing to be done... obviously at this price range for a home i wouldn't be looking at anything too new as they'd just be very very far out.

Much appreciated, Glad i found this site hopefully i'll get some awesome suggestions and input!

 

Hi and welcome to the forums

There's a huge amount of benefit in being able to research and find the property yourself. Vacancy rates are easy to find online, and growth potential is usually evident when you dig a little deeper.

If you know the areas you're keen on, check the vacancy rates as a start, read the forums and start to get an idea about what constitutes a good investment property.

 

House 100% in these areas. You might be surprised at prices. Not much for under $300k. Probably get pushed towards Ipswich for that $.

 

Another Holy Grail purchase. Then hope and pray.

Threads/posts on here about cheap properties in low social economic areas. Lots of dramas

It's nearly always land. Avoid any thing with body corporate fees. The exception seems to be 6 to 8 block units close to CBD that are old with a good land component.

Can you value add to house purchase? Cheap reno?
Is the block subdividable? Retain and build?
In the future will a developer want to buy the block?
In the future who will want to pay more for your purchase than you paid?

 

@My House QLD this will be a good question for you to assist with.
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Hi @LM993 and welcome to the forum!

You'll struggle to afford a house on Brisbane Southside for $300k, especially if you don't want to invest significantly in repairs/renovations, which moves you to Logan (or Inala). I'd say generally you'll have a higher yield and lower capital growth potential in Logan- but of course these things all vary based on the property condition/configuration, where it's located and how you manage it. There's also some great opportunities to create quick equity to continue growing, but you need to be careful with these strategies- e.g. often the below market property needs work...!

What would it take for you to expand your budget by 30%? That would stretch you back into Brisbane Southside (Algester, Acacia Ridge, etc.).

 

I have a few of these properties and have never had a drama in 5 years. If your property presents well and you have a GOOD PM you'll be fine. Got a run down house with an average/poor PM then you might have dramas...

 

How's your 5 year capital growth been? What kind of growth rates have you seen?

 

Also have houses in low socioeconomic areas. Purchased in Bridgewater and Clarendon vale of Hobart. Never had a problem of tenants or rent and id say they are safer option in times like these as they aren't subject to vulnerability like most other places

 

Good to hear. Happy for you. But my question wasn't about tenants. My question was specifically directed to @My House QLD, as I'm hoping his 5 year no tenant drama scenario has also delivered some 5 year tasty capital growth.

 

Yeha my post was more referring to your previous post about having dramas in those areas.

 

There was no such post, but cool, lets get back to topic.

 

Gedankenexperiment

Take one of these $300k investment properties in low socio-economic areas with say a $270k loan.
What weekly rent would I need to collect for it to be a good investment? Say currently 3.25% interest. What about 5%
What do I need to sell it for after say 15 years for it to have been a good investment? after all fees and capital gains etc.

I don't sell or manage properties for a living just a student on here.

Keen to see a real life example of a few properties that are were good investments (excluding ones in towns with a mining boom causing a rapid unexpected increase in capital value)

The Holy Grail, Examples of properties for sale or recently sold not just vague suburbs

 

Corio, Geelong if you purchased in 2015ish

 

think your not ubderstanding what makes city property grow in value

melb, syd and hobart low socio economic areas have seen big capital growth in the last 5 years
a lot would have doubled in value and would of had good rental yield to start with

reason the low socio economic.places boomed in these cities was because of demand and price disparity

huge demand and a huge difference in price between middle class suburbs and low class suburbs -.im talking 7-800k vs 2-300k

reason why brisbane and adelaide lower suburbs dont boom is the demand isnt as high (relative to.supply of.course) and they arnt much cheaper.than the middle.class.suburbs.

why would logan boom when you can still.buy a house in a much better suburb for 450k?

 

Example of my Bridgewater house which basically 1 suburb off lowest socioeconomic suburbs in Hobart. Purchased start of 2016 it's had 9.8% annual growth and rent yield is 8.6% however I could get 9.5% if I wanted to. Like the poster above me said though you can't compare Hobart to Brisbane they are just completely different in so many aspects.

 

The answer to that q is dependent on the area t h e deal and whether you can manufacture equity through renos etc. 25 - 30% in 3 years even in Logan is possible...that is in a suburb with good oo levels and higher than avg incomes

 

Agreed, back in 2018 I bought in Herdsman Cove (Tas), have tenants on the doll living in there, no issues of losing a job, look after the place and there is already $45K of equity from a $200K purchase.

 

And to answer your question directly, I feel some good areas for future growth might be (in no particular order):
- Bendigo
- Perth
- Moreton Bay Area
- Sunny Coast
- Logan

Should be able to pick up a house in any of these areas that is semi-decent without the need of throwing cash at the place.

Feel free to challenge me! - I'm a 25yr old with 3 properties trying to get as many as possible and hold!

 

Good PM? Can you recommend one?

Thanks