QLD convince me deception bay is a bad idea

I'm not sure what makes it weird. Maybe it's driving past Rothwell, I always thought of Roswell. That combined with Deception Bay. I'm not saying it was aliens, but it was aliens.

 

For me I wouldn't invest there for a number of reasons:

Opportunity cost - there's better buying for similar money closer to Brisbane
It has waterfront property, but not a waterfront many people desire to be near
Oversupply of rentals
Oversupply of vacant land
Brisbane locals know that it's pretty much a **** area and that reputation / stigma will take a long time to change.

I was recently talking with an agent in Scarborough who said he had Sydney buyers flying in for the day wanting a tour of a Deception Bay. They were predominately buying ex-public housing stock and lower range properties >$300k and some Buying two properties at a time. The agent said he wouldn't touch the area personally - low yields, lots of rental supply and little chance of decent capital growth.

Still, you pay your money and you make your choice. Genuinely, good luck with it.

 

We've done very well in areas we've been told were areas local wouldn't buy in .

The changes in price in D- bay won't be driven buy locals . It will be driven by interstate investors who see cheap places close to the water .

Cliff

 

Its called looking at the opportunity without rose colored glasses...

 

In this situation I'd call it looking at opportunities with out blinkers on

Cliff

 

I'd say that the Brisbane investors ('locals') are in on the joke.

 

Huge land supply, proximity to city, demographics, reputation. These things will mostly change over time, question is how much time do you have.

 

At some stage in the next 1-5 years all of the cheaper areas in Brisbane will be worth significantly more than than they are now .

At the moment , the smart interstate investors are already in or will be getting In in the near future .

Seen it occur first hand in several places in the last cycle .

The only time some believe something is going to happen is when it has happened .

Check back in two years time

Cliff

 

I won't, cos I know you will only confuse me more
You have downsized your sydney ppor, so plenty of $$.
You purchased in the bay area in 2013, a Brisbane median price range.
You were a slumlord back those days where your tenants had poo fights...
You aim for a quick flip in the next 3-5 years and not intend a long hold.
You are more interested in T/H/Vila and newr type so less maint issue

Based on your previous post on yield requirement, I don't see Moreton Bay meeting your requirement, unless you go for dual living which I doubted. Anything >350k is hard to find a yield >6%.

 

We have different criteria for different places and times .

Manly , Wynnum . Nice properties , lower yield but less hassles . Long term hold, yields closer to 5 %?

Lower SES areas . Cheaper . Higher yield . More hassles , easier to buy lots and if sell , can spread capital gains taxes over the years . Will sell to pay off the debt on the " nicer " properties .

I m working on the basis it will be easier to manage a portfolio of around 10 nice properties than 30 less so nice properties

Cliff

 

Whats your time horizon?
maybe waterfront and all that...but for the ripple effect to take hold all the way to deception bay, your looking at a very ling time. Deception bay is about 32 km from Brisbane, and whilst that may be ok in Sydney, it aint so much in Brisbane. Besides, as other posters have said, there is a lotta land between Brisbane and deception bay...

 

Yes - but not a great deal of land close to the waterfront. A place where a good sea breeze can be important, particularly in Summer. Besides, if vacancy rates are low, yields are good, infrastructure improving and area gentrifying - why not invest?

The process of gentrifying started over 20 years ago, with ex-housing commission homes being sold to private owners.

 

Hi
I was looking at Deception Bay last year. Figures seemed o.k., but crime and demographics didn't look great. Plus need to check supply/demand issues. Having said that, I have invested in Woodridge, which has been fine over the years, and good yield. It really depends on your strategy and risk profile.
Cheers
Jen

 

I like this as a longer term CG opportunity.

Just settled on two. Yield percentage of 5.5% on a 3 bedroom house was dilutive to my portfolio average of 6%, so also purchased a townhouse at 7% yield (plus Depreciation) to balance it up a bit. Both are buy and hold.

Market was pretty hot when I was up there. Ran into a few Sydney investors.

 

Sounds good.

What size and configuration is the townhouse to achieve a 7% yield? 3 bedder or 4 bedder? Garage - single or double?

 

It's a neat and tidy 3 bedder with a single garage. Has had the same tenant since it was built 10 years ago

 

What impact do the BC charges have on the overall return . If they're low it's ok , but with lots of the TH/ units we've looked at , the impact of these drops the returns down to net return down to similar levels to freestanding houses .

Cliff

 

Hey doc......I agree with you...but i am about 5 short of 30.....however...at some point I will look to sell down an get a few cash cows for income which are really nice in Sydney or Melbourne...when the market correct happens.

The beauty with smaller properties less in value...they can double easily. I have a couple in my portfolio bought for 90k or 163...which are now worth 520K+ and 580K+ plus.

The other ones are bought 3-4 years ago for something like 263k and 243k they are now worth 500k+ and 410k+....I will look to see these as capital gain hit easier to manager. Assuming I take the 263k one...including stamps and sell cost the cost of purchase/sell would be 280k assuming I get 500k...the net profit is 220k. 50% Cap gains reduction is 110k income...I would have pay 50% of this. But if I pre-pay my interest say for 100k...I would only pay abut 5k tax. If you profit was say 400k on much larger property the 200k profit would incur a larger rate of tax.

 

Going well sash .

You know what you're doing . Keep it up .

When things are moving ,I think the cheaper ones double quicker . That's what we're doing at the moment .

Cliff

 

Thanks Seech...as I said..I have no idea...what I am doing..I just stumbling in the dark. You are doing not bad yourself.

Hey on another topic...I was stunned (seriously)..that you will hit the straps on borrowings...either you have bought quite a few places in the last few months...or the APRA changes are bordering the ridiculous.

You da man....!!!