Buying a Property In Brisbane

http://www.abc.net.au/news/2015-08-14/earthquake-rattles-queensland/6697516

 

@Bryan Loughnan: when looking at this indicator



You can't go wrong buy in Brisbane area, because it is at the rising market, so potential CG to be made before it reaches the top of the cycle like in Sydney.

My Friend have just secured new H&L package in Park Ridge, QLD 4125, with just $350,000 you can get 4 bedders with land size of 280-290 sq Metre.

Where else can you get that price for a new property in a rising market ?

http://www.realestate.com.au/neighbourhoods/park ridge-4125-qld

Looking at the statistics above, it will be a profitable buy after 10 years or so.

 

Thanks for posting the image @Tekoz , where is that one from?
Boy, that's a pretty small block for buying out that far. The price is mostly house.

 

Hi Tekoz - I've seen that graphic - agree that the long term fundamentals of Brisbane are sound - but just because someone puts a graphic together doesn't mean it's always true.

Significant supply both inner City appartments and unfortunately for your friend massive land banking by developers North and South of the city are causes for concern - at absolute worst they are a cause to be very cautious.

Cani ask why your friend bought a 'new' property in that location on such a small block as an investment?

 

What are your views on the Sunshine Coast and Gold Coast mate? What would you go for and avoid?

 

Short term - Gold Coast has all the indicators that it will have a very good 2-3 years.. Possibly better than anywhere else in the country. Longer term - investors should keep a close eye on Building Approval numbers (Lord Mayor Tom Tate has done an incredible job getting the economy going but with his background as a developer growth has been strongly driven by the construction industry). Other supply considerations include the breaking up and distribution of the athletes village after the 2018 Comm Games.

Sunshine Coast concerns revolve more around longer term demand. As property investors we are business owners providing accommodation/shelter. Generally - most people choose to live somewhere because it is where (or close to where) they work. Outlook for diversified industries with significant job growth prospects are limited on the Sunshine Coast.

You could certainly do worse than investing in South East QLD at the moment - but am very confident you can do better as well.

Good luck!

 

Well, it is because the price is still reasonable in Brisbane, on Stage 1, while on stage 2 it is asking from $400k onwards.

he's just starting to build his investment portfolio, so Brisbane House is the right choice according to his condition for a starting point.

I'd say you cannot go wrong investing in a house with a land component.

Note: he's done the due diligence from the Google searching & information around the area, many big stores are opening in the area near Park Ridge.

From what I can see, it is the same thing as Schofields here in Sydney NSW, where it can grow up to 43% in a year.

 

@Azazel it is from Herron Todd White, property valuer company. They released the graphic monthly along with some useful insight on Property investment.

http://www.htw.com.au/downloads.aspx

Hope that helps.

 

Park Ridge on 200 something?

Why???? Due diligence is not talking to different spruikers before you pick one.

280m2 in a rural area? Why would you do this? I live on 407 inner city, and that is small. sounds like a ghetto.

Insane. So much land out there.

For that price I would have parked my money in a Greenslopes walk up or a townhouse somewhere else, will almost have the same backyard.

I don't want profits in 10 years as opposed to 1-3 years.

 

Cheers, I see it occasionally but can never remember where it's from.
Thought the colour looked a little different.

 

Nice one, I'd prefer Mt Gravatt over Runcorn for sure.
And good on you for passing on your knowledge to your son, sounds like he will do well in the future.

 

It probably WILL go up 43% in a year. But this is because the new selling stock is priced higher than the old available stock.

PS. I'm not innately familiar with Park Ridge but used to live that way and I've posted about it before. The land continues west to the NT border.

If I were ready to buy in these areas, I would peruse Browns Plains, Regents Park, parts of Crestmead (perhaps), Heritage Park. But I would be targeting those homes that a decent family would like to rent (or buy) on a DECENT block. (That is the whole point of being so far from the city! )

 

Exactly, there's no scarcity.
Surely a bigger block closer to the City is going to do better long term.

 

Tekoz,

Ive done literally a two second search, but I'd rather something like this.

I'd be interested in frontage and access/size of the back yard for dividing down the track

http://www.realestate.com.au/property-house-qld-crestmead-120244797

Or, just leaving it. Still better than 290m2 (nearly 3x)

Each to their own I suppose.

 

Quote..i can't write that well...

The 224 square-metre property came with green-lit plans for an architecturally-designed three-level home, in one of Brisbane's most popular suburbs.

http://news.domain.com.au/domain/re...ew-farm-sells-for-960000-20150813-giybil.html

 

Crikey. Pretty good yield.
I hope if they can ever afford to build they get rid of the workers cottage, that 'artists impression' looks stupid.

 

Yes, that does make sense guys.

So ok, what about Wynnum and Manly area ?

Would that be a good area for land banking ?

 

Hi

Hi Tekoz,

Took me a while to decide how/whether I was going to make any further comments on this and now that I decided I would, there seem to be plenty of subsequent messages saying very similar things to my own thoughts.

I'm certainly not saying that your friends made a 'terrible' investment decision. They could have done A LOT worse than investing in South East QLD at the moment. I also believe they could have done better.

I'm not interested in debating whether one suburb will or will not perform any better than another suburb. A single suburb can't simply 'boom' without the greater region performing well.

What I do know though, is that there are people that read this forum and take things that are written very seriously. I just want to make sure that if there is someone out there that considers making an investment decision after reading this thread - that they do so with their eyes open.

Schofields, has performed very very well over the last 18 months... but so has all of Sydney. I have no doubt that (as mentioned in another comment earlier) that the suburb of Park Ridge could well see it's 'median' price increase significantly over the next 12-24 months. I do not however expect that a single property in Park Ridge will increase by 43% though. The fact that median values are simply the average price of properties sold over a period of time is something that a lot of people forget - ie if all of the new properties sell in the next 12 months for more than $400k - this doesn't mean your friends property will suddenly be worth that much. 'Median' property prices as reported are hardly worth the paper they are written on without understanding the break down of the statistics... houses v apartment sales.. new sales v existing property sales... how much has each property had spent on it since it last sold??? These are generally things that aren't publicised with the figures yet have a HUGE impact on the figures.

Furthermore, the greater Brisbane economic outlook over the next few years certainly doesn't suggest that it will perform like Sydney has. We need to remember there are a lot of factors (most of which are not sustainable) driving the Sydney property market. We also need to remember that since the turn of the century, Sydney is the worst performing capital city in Australia. This includes the last 2 years which it has been the best performing location in all of Australia. Further to coming off a very low base, we currently have interest rates lower than any living person in Australia has ever seen - creating a false 'increase in expendable income' or affordability situation. We also have significant international investment activity creating increase in demand..... Whether this is sustainable or not is very questionable.

Schofields, compared to Park Ridge also has the advantage that it is currently situated in NSW. Economics 101 suggests that Supply and Demand drive commodity prices. With property markets, Confidence also needs to be taken into consideration. Confidence at a local, state and federal level. Without confidence, people aren't going to put their hands in their pocket and spend hundreds of thousands of dollars on investment properties. Ultimately, the NSW Government have created a huge amount of confidence in the market and what is being seen in Sydney and greater NSW at the moment is no coincidence. Unfortunately, we do not have nearly as much confidence in QLD at the moment. Hopefully some stability will return to the QLD Government sooner rather than later and hopefully soon, for all of us, the current state government will eventually release some guide on their infrastructure plans. Until then, business and consumer confidence will remain lower than we would like.

At a more micro level, (as has also been pointed out in other comments) vacant land, or 'land banking' as developers call it, all around the fringes of Brisbane at the moment is a major concern. From areas in the North like Morayfield and Burpengary through to Ipswich, Springfield and Logan in the West and South - Brisbane has a lot of land which will support future growth. Unfortunately such potential for supply should cause concerns for investors.

My primary concern however is that they purchased a brand new or off the plan property as an investment. I could start a whole new thread (or I'm sure there are many) arguing whether you should buy new or existing - my personal opinion is that there is very little to no benefit of buying brand new for an investment property. If it is for a PPOR and you want to design something or you want everything to look new and shiny - then great - buy new... but as an investment, I can think of much better uses of $50,000 - $60,000 than paying a premium for a property which is shiny and new and most likely in a location (similar to Park Ridge) where there is lots of other supply/development occurring.

Whilst it may seem like it, as I said at the start of this 'rant' I certainly don't think your friends made a 'terrible' decision - I suppose I just don't want people getting the thought that a brand new property somewhere like Park Ridge is going to increase in value by in excess of 40% in the next year or so.

 

That would be my major concern too I agree.