QLD Caboolture Yay or nay?

ive seena few well priced and good return on investment places come up at Caboolture. im looking to sepnd under 250k so it rules alot of other areas out. I own several properties in Rockhampton area (land, triplex, 3 houses)

 

Like Good..nah...it is a nah.....

 

I've got a 2 bedder apartment there. Purchased @ 233K and renting @ 280/week. Low strata & maintenance. Tenants are also good. It is a cashflow suburb rather than a capital gain. Thought I'd get some cash flow properties in my portfolio to assist with negative gearing. Definitely try to negotiate with sellers there as it is still a buyer's market there.

 

@thu555 thanks for sharing your experience. Hope this doesnt come off as critical (I am not trying to say this in this way!), but rather I am just curious. Is this property even really positive (net) cash flow? Gross it is a 5.53% yield, but even with low strata, QLD-priced MGMT (assuming 7.7% MGMT which is pretty standard in the area?), Council, Water, a rainy day/vacancy/repairs 'kitty'; does this property actually net-out to positive cash flow? My guess is that it'd be 1% net yield at best, but probably aroind the 0 or -0.5% yield at worst?

I'm just asking because, net yield to beat the banks savings interest rate offered and to beat inflation would need to be 2%+, to make it worthwhile. Of course, I do not know/have not considered youe taxation/NG situation so that info could well tip this into net 2%+ yield territory.

 

I spoke to 2 very reputable buyers agents when looking for my next purchase. Given my circumstances I needed something that wasn;t super heavily negatively geared.

In my initial meetings with the first buyers agent, I was recommended to build a new property on the outskirts of Caboolture for approx $350k-$400k, renting for close to $400pw. I walked away from this deal, and happy that I did.

The second buyers agent I spoke to, we discussed places such as Petrie/Kalangur as options in QLD, which i was very comfortable with given the new university and the infrastructure going up around the area.

Then, the net day they sent me an email containing a recommendation to buy in Caboolture 'quick smart'. They had found THE place for me. $280k for a 3 bedroom house, without a garage, renting for $320pw through the government (commission). House looked in OK condition, but again I was very unhappy with the area, and again, walked away from the deal and promptly asked for my deposit back.

Can take this 2 ways I guess - 2 very high profile buyers agents looking to recommend the same area. Maybe they're on to something, similar with the Western Sydney boom a few yers ago..

... Or, they could both be wrong, and attempting to get a high count of deals across the line due to the nature of the market up there and deals being able to be struck at 'under market value' (20k discounts on adverttised price...)

I will not be buying there.

 

What skills are required from a buyers agent to source properties in Caboolture? Ability to deceive and pull the wool over the eyes of buyers? What else?

 

Hence my reason for running.

Interestingly, I challenged the 2nd buyers agent on why Caboolture, and why that property, and then sent them 3 other properties, that to me provided better value, and a better yield.

Very disappointing from a very very highly regarded buyers agent, who up until then I had held in high regard.

 

It has an express, Goodna does naht.

 

I will be very careful what I say. But I have seen a lot of evidence of buyers agents not doing the best thing for their clients. Quite shocking. Really abusive of trust.

On the flipside there are some on this forum which post the properties they got for their clients and deals they found, and good deals they were too.

 

Caboolture close to the train has definitely had CGs. I would not rule out Caboolture. Would take Caboolture by the station and CBD over DBay.

 

My net yield is 4.3% but it is better than my investments in Sydney. I have selected this Caboolture property due to low body corp ($960/year). But management fees in QLD are generally 7-9%! Can't get away from this.

 

You are achieving 4.3% NET after all costs? On 233k purchase yielding just $280pw?

Is this an 80/20 LVR loan with IO? Or is it less e.g. 60/4 0LVR?

The body corp is super low - thats awesome! I'm guessing youe council, water, and MGMT are super low too?

 

Absolutely, I tried to be as careful as i could, and definitely not name names. I still go to of the agents market update seminars etc.. as they provide decent information and insights, but just didn't see eye to eye when it came to Caboolture.

I have too seen some fantastic results from buyers agents. Very envious.

 

Compare QLD's fees to Sydney in real terms (dollar value) and we're significantly cheaper in all but the most expensive areas.
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I'm not a big fan of buyers agents, by and large I have seen nothing but scams and poorly considered recommendations from them. There are a couple here on these forums that I've seen achieve outstanding purchases for their clients though, so as with anything, they're not all bad.

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Caboolture is a great area for cashflow, but just keep in mind just how far away it is from anything, plus the demographic... which is NOT improving, if anything it's getting worse.

Of course I'm biased, but I think Logan is a much better bet when it comes to that sort of area- much closer to the city, better council with better infrastructure etc and better growth potential.

But hey, since I bought my 4WD, a small part of me wished I lived up that way. The drive to Teewah Beach and Bribie Island is so LONG, and the Sunny Coast is so much more fun than the Gold Coast.

 

You care to name who the high profile buyers agent was?

 

Sent you a PM

 

Hi Tom,
I'm keen to know what you think regards to future land releases and the potential for saturating the market. Last time I looked this was a fairly important factor for me...Is this still the case in your opinion?

 

There is a MASSIVE amount of land available in and around Caboolture, and will be for a very very long time.

 

Could not agree more.