QLD Brisbane Property Comparison - Opinions?

My husband and I really like the Camp Hill/ Coorparoo area in Brisbane and have been looking for a 3bdrm townhouse or unit with some garden/outdoor space as we have a 14 month old and another baby due in July. We were aiming to pay under $500 000, be close to CBD and are interested in 2 properties. We see ourselves living there for 5 years or so until I am back to full time work and we can afford to upgrade so we would ideally like to make some money/CG when we sell. The extra appeal of both properties are that there are parks and cafes within easy walking distance - just something of interest so we don't have to take out the car.

Keen for any thoughts or opinions on what to consider given our needs. Any Brisbane areas we are skipping that meet our needs and price range. We have never lived in a townhouse so also keen to hear any warnings, insights or factors to consider when buying them.

** Have uploaded sales history of all townhouses in both complexes.

Thanks in advance for any responses.

1. 17/21 Boongall Road, Camp Hill QLD 4152 | Domain
(One of 23 townhouses - body corporate of approx $795 per quarter)

2. 6/7 Derby Street, Coorparoo QLD 4151 | Domain
(One of 7 townhouses - body corporate of approx $330 per quarter)

 

Townhouses in Brisbane
Rule of thumb is buildings depreciate. If property prices go up, it is usually largely drive by rises in land values.

Therefore, townhouses will not appreciate as much as freehold properties, but likely to be better than apartments.

Can still be a decent investment if not so concerned with capital gain and get good yield (but check yield after body corporate expenses are taken into account). And sometimes it is better option if high value is placed on being in a desirable location and on a tight budget relative to the median house price of the area. You may not get great capital gains, but if it puts you in an area you want to live in and makes repayments so affordable that you can really throw lots more into the mortgage, this will help build your equity fast and smash down debt faster.

Body corporate levies - will be a mix of levy for yearly type costs, and sinking fund for longer term maintenance issues. Body corporate (which is basically an organisation made up of owners) is responsible for certain aspects of maintenance and insurance for 'common property' and the fees go towards this.

As well as body corporate levies, there will still be council rates to pay.

Low levies are not always a good thing, if insufficient is being put aside for long term maintenance costs.

Larger complexes sometimes mean less fuss but higher levies because you will generally pay a body corporate manager for grounds work and admin (often admin and the grounds work are separate issues). And there will be still some paperwork as general meetings.

Smaller complexes often try to save money by doing work themselves on the maintenance and/or admin, but this can be a real headache if you are one of the few owner-occupiers that get lumped with that type of work. Less economies of scale to get professional maintenance or admin.

Get a good body corporate specialist to do your conveyancing. I would be happy to give you my husband's number. He is a solicitor who specialises in body corporate management type issues, and he would probably be happy to have a no obligation chat if you want to understand more about body corporate in Qld.

Boongall Rd

It looks fresh and modern and a pool you don't have to maintain would be a good bonus with kids. Pool will be part of the reason that body corporate fees are higher.

But decent building and pest inspection necessary just as for older buildings (particularly with the quality issues with some modern builds these days). Check into cladding - there have been issues with some modern townhouses having non-compliant cladding.

I would carefully check flooding and overland flow issues: it backs onto a creek and may increase flooding risks which might mean higher insurance premiums (both for you and for the body corporate). Check Brisbane Council floodwise reports and maps if you can find them. Also suggest you get a premium quote from Suncorp for insurance that includes decent flood cover: I think they have fairly detailed mapping on flood risks (We were looking into a house on a large block that had overland flow in back third several years ago, and the quote was pretty good. When I asked about the overland flow issue, the lady I was speaking to said that Suncorp modelling indicated the house wasn't at risk, so it had no impact on the premium).

Derby St

Bit concerned about why there is no floor plan. I probably wouldn't want to have one of the townhouses that backs directly onto Cavendish Rd, which is busy.

Older, but sometimes the build quality can be better, and there is less depreciation involved.

 

Thanks so much Wylie for your response and insight. It is nice to hear other people's thought a- good point on the schools. My husband did check re flooding and it has not flooded but we will definitely double check this. Boongall Rd sold for $445000 in 2016. Agent has told us mid-high 400's and that he will take all offers from $450 000 up to the owner. Derby St will need some work as it is tired but it has a downstairs powder room whilst boongall doesn't so we were looking at costs to put one in. I jump from preferring one over the other nearly every hour. Derby is brick, in a small complex, has potential, low body Corp and feels sensible if we can get for the right price as we need to do work. $495000 feels too high given the work needed and we couldn't afford to do it anytime soon at that price.

Boongall feels easy but I don't like build quality of bigger complexes as much as derby st. Body Corp is higher due to pool etc. But very handy location.

Sorry just thinking out aloud.

 

Thank you so much for giving such a thoughtful, comprehensive and considered response. It is so helpful - printed it out to put in our folder. If you could pass on your husband's number I would appreciate it.

Will try and find out who the building insurance is through for the boongall road complex as this is included in our Body Corp. I suppose we have no say in the insurer (apart from contents) but my Mum has had several home insurance claims with Suncorp and found them to be very prompt and thorough.

The lack of floor plan for Derby St has been frustrating but we did manage to find one for another in the complex. We feel it is over priced at $495 000 as it needs quite a bit of work as it's tatty - I am sure everything is still the original 80s fixtures. It does have a downstairs powder room which was important to us.

Boongall feels easy and straightforward but no downstairs powder room and slightly hesitant over a complex size of 23 and high body Corp. Wondering how $3800 a year fits with other similar complexes.

Do you know if there is a general rule of thumb for amount that should be kept in sinking fund eg) Is the contribution from each owner a certain percentage of their property value and that Is what it should be kept at.

 

Hi AnnaSophia - I am not sure if there is a rule of thumb on body corporate sinking fund, as it has more to do with the likely capital works, things that might need fixing or replacing. For example - paving or road surfaces in the complex. Pools would need long term projection. It's more about projecting those likely costs and whether they have a good basis for doing so. My husband would have more knowledge on that area, including how insurance tends to work. Will message you his number so you can have a quick (no obligation) chat.

 

Both those properties are near each other and generally quite reasonable area around there.

However, be advised that those properties are right under the flight path into Brisbane Airport (check Brisbane flight path maps), which is why the property's value is perhaps a bit lower than comparable properties in the same or nearby suburbs that are not under the flight path. You will need to hang out in the area for a bit when the planes are landing to see if it is acceptable to you.

21 Boongall Rd appears to be a gated community with some enhanced amenities (i.e. pool). It appears to be well kept, and seems to have a nice feeling. Once again, hang out and talk to the people living there. Body corporate fees are a bit high but it pays for the amenities like the pool. Probably not a lot of value-add there but looks like quite a comfortable place to live in. It is also near the Martha St precinct which is nice little cafe / restaurant nook area.

7 Derby St appears to be a more straight-forward townhouse development, lower body corporate fees. Potentially some potential to value-add / renovation. The property is on the corner of Cavendish Rd. Cavendish Road is a very busy road and can be a bit noisy. The property doesn't seem to have a lot of play area.

In both cases, check all the history of the body corporate for maintenance performed and any flood damage especially Boongall.

Coorparoo State school nearby is a good school. Out of the two, would consider Boongall Rd as probably the better place to live, especially in your situation with having kids.

Alternatives:
1) A little bit further out to Carina.
2) Northside, try Alderley, Enoggera, Gaythorne, Mitchelton.

 

Hi ORAC! Thanks so much for your advice. We didn't know they were under a flight path so will definitely go and spend time assessing the noise. Whilst the property has never flooded we rechecked and saw it as at risk of flood overflow so going to explore insurance cover etc after everyone's great advice.

 

Have you thought of renting in your preferred complex for 6 months to see what it’s like? This is what we did before making the jump from outer suburbs house to inner city unit.

 

Unfortunately this one is rarely up for.rent but would be super keen to do what you suggested because like you said you get a true feel for the place and if it works for you.

 

If you want Townhouse or Unit in that area, do consider renting there.
The reason why people receive negative gearing for Townhouse/Units is that the expenses for these buildings is higher than the rent.
If you buy and live there, it'd be your PPOR and you wont be able to claim the expenses especially the Levy.
And generally the Capital Gain from Townhouses/Unit is not as good as landed properties.

You probably heard of the term RentVest? Do consider buying in another suburb, might be further than what you desire now, but with your kids growing-up, you might want some backyard to kick a ball for them later on, and they can play without having to worry about By-Laws and Body Corporate.

 

Re flood check - I find the Dept of Natural Resources floodcheck maps are best. These two street are out of flood areas - FloodCheck Queensland

 

Please consider a house

 

Will definitely be getting a house when I am back full time at work but whilst we have babies keen to stay closer to the CBD so my husband doesn't have such a long commute and will get to have more time with them of a morning and evening. We are currently living at Kangaroo Point and my husband often can come home for lunch just by getting the cross ferry.

 

Thank you! Have saved the site and will look it up now. Just as I am a big of an ignoramus with all of this - is there a reason you prefer the Dept of Natural Resources as opposed to BCC floodwise check. Trying to learn as much as I can.

 

Thank you, we are open to all ideas. The issue with renting is that we have been renting our entire lives and came back from London after renting for 3.5 years and just feel we have haemorrhaged money on rent - esp in London because we have always lived relatively central (a lifestyle choice). Keen to get somewhere closer to CBD under $500 000 so repayments are manageable, my husband doesn't have such a lengthy commute and our money is going towards something we own. Once I am back at work we would buy a house further out.

 

Fair enough, people say rent money is dead money......
I am not familiar with the 2 properties you mentioned. But would suggest you also look at Greenslopes, just border with Cooparoo and in fact I know some streets have Greenslopes on one end, and Cooparoo on the other end.

 

Good bus commute from Carina and Carindale too

 

It's a lot easier to use and is all of QLD, BCC is Brisbane only. It can search by street, or just suburb. Try searching, say, 281 Gardner Rd, Rochedale on each. BCC cannot find it. DNR can. Note that when I search on the DNR floodcheck, I zoom out first to get the floods to show, then zoom in. Also, in the Map Layers field on the left, you can select the different floods.