Entry level invest property in Adelaide or Brisbane?

Discussion in 'Where to Buy' started by Chris93, 13th May, 2020.

Join Australia's most dynamic and respected property investment community
  1. Chris93

    Chris93 Member

    Joined:
    20th Mar, 2020
    Posts:
    10
    Location:
    Melbourne
    Hi guys looking for people's personal opinions on wether they would purchase an entry level investment property (270k-300k) in ether Adelaide or Brisbane. I'm based in Melbourne and don't believe there to be any investment worthy stock at this price point hence why looking interstate. A free standing house within 30kms of cbd that is cash flow positive/neutral would be my main focus as I'm still studying and although would have a cash buffer in place, would prefer somthing that didn't cost money to hold. I have done alot of research of my own, just curious on other people's options! Cheers Chris .
     
  2. CryptoClown

    CryptoClown Well-Known Member

    Joined:
    12th May, 2020
    Posts:
    45
    Location:
    NSW
    Since you are starting out I'd look for something that you can add value or split at some point. Brisbane around Ipswich or Moreton Bay would be my pick. Adelaide is more of a cashflow play in my opinion. Cashflow doesn't help in the early days but equity certainly does.
     
  3. R S Gumby

    R S Gumby Well-Known Member

    Joined:
    24th Jan, 2018
    Posts:
    70
    Location:
    Hazelwood North
    I bought in Paralowie which is North part of Adelaide a couple of years ago for the price you are looking at paying. It's neutral/positive with some growth and no problem finding good tenants. It's a steady play, not fantastic but slowly appreciating in price
     
  4. Chris93

    Chris93 Member

    Joined:
    20th Mar, 2020
    Posts:
    10
    Location:
    Melbourne
    Hi thanks for your input! Was also thinking that those areas in qld would most likely be growing at a faster rate then Adelaide which would be a slow and steady sort of play. IV been looking around the Goodna area which looks like an affordable and nice growth area my old concern would be to buy in a flood prone area.
     
  5. Chris93

    Chris93 Member

    Joined:
    20th Mar, 2020
    Posts:
    10
    Location:
    Melbourne
    That's good to hear thanks for sharing that! I have also been looking around the northern Adelaide area in places like Para Hills. Are you from Adelaide or live interstate?
     
    Kriv likes this.
  6. R S Gumby

    R S Gumby Well-Known Member

    Joined:
    24th Jan, 2018
    Posts:
    70
    Location:
    Hazelwood North
    Country Victoria
     
    Vick B likes this.
  7. ashish1137

    ashish1137 Well-Known Member

    Joined:
    12th Sep, 2015
    Posts:
    842
    Location:
    Sydney
    Hi Chris,

    Your thoughts are pretty good.
    Wjy not look in Ballarat or Bendigo markets with comparatively higher entry point at say 365k to 400k but brand new house, decent land, 5% yields and equity as well.

    Easily tenanted, low vacancy rates, budding areas and way better prospects than SA or QLD.

    Regards
     
    Chris93 likes this.
  8. Ko Ko Naing

    Ko Ko Naing Mortgage Broker Business Member

    Joined:
    10th Aug, 2015
    Posts:
    594
    Location:
    Melbourne
    Clients have IPs in Parafield Gardens. Good cash flow and steady CG. Cost nothing to hold there. So it’ll be worth it to look at that suburb and the surrounding areas.

    +1 to @ashish1137 , Ballarat or Bendigo would be another option. A little harder to find in Ballarat, compared to Bendigo for better cash flow though.
     
  9. Spiralkut

    Spiralkut Well-Known Member

    Joined:
    12th May, 2020
    Posts:
    142
    Location:
    Melbourne
    Brisbane hands down. Anywhere around the Moreton bay area is absolute gold ATM and you will win big in the next few years.
     
    CryptoClown likes this.
  10. Shogun

    Shogun Well-Known Member

    Joined:
    26th May, 2018
    Posts:
    1,252
    Location:
    Perth
    Arrrh the Holy Grail. Under $300k cash flow positive or neutral. Really you still need a couple of percent capital growth per year to make investment worthwhile imho. Good luck finding that.
     
  11. jim1964

    jim1964 1941

    Joined:
    18th Jun, 2015
    Posts:
    1,249
    Location:
    Adelaide S.A.
    Christies Beach in S.A.,great entry point,go for the MP40 zone, its going to spike at some point.
     
  12. Chris93

    Chris93 Member

    Joined:
    20th Mar, 2020
    Posts:
    10
    Location:
    Melbourne
    Are you saying that there is no where in these capital city's you can buy a neutral/positive cash flow property for around 300k that would not be able to achieve a very small % capital growth over 10-15yrs?
     
  13. Chris93

    Chris93 Member

    Joined:
    20th Mar, 2020
    Posts:
    10
    Location:
    Melbourne
    Thanks alot mate I'll look into it!
     
  14. Chris93

    Chris93 Member

    Joined:
    20th Mar, 2020
    Posts:
    10
    Location:
    Melbourne
    Hi Jim, I have heard good things about Christies beach just not to sure if I'll be able to source anything around 300k as it looks like all the older stylefstyle standing houses go for around 320k-380k. Really think it's an under valued beach side suburb though and seems to be alot of subdivision/townhouses going up!
     
  15. Shogun

    Shogun Well-Known Member

    Joined:
    26th May, 2018
    Posts:
    1,252
    Location:
    Perth
    No. Do the math.

    Using Perth numbers
    300k property maybe $300 a week rent so about $15500 year
    Loan $250k interest $7k to $9 a year
    Pm fees $1500 to $2000
    Rates $1800
    Water rates $1200
    Insurance $400
    ECM insurance $300
    Loan fees $300. Allows offset account
    Maintance repairs $1000 to $2000 a year
    Smoke detector checks $125
    No depreciation old property

    Growth needs to cover buying and selling cost
    Deposit would be getting earning 5% plus as dividends as shares

    Current very low interest rates blur the equation.

    Make rent $270 a week and empty 2 weeks a year.

    High rent is often in areas with low capital gains expected.
     
    Last edited: 13th May, 2020
  16. Spiralkut

    Spiralkut Well-Known Member

    Joined:
    12th May, 2020
    Posts:
    142
    Location:
    Melbourne
    @Chris93
    Hey mate, Brisbane is by far best place to buy ATM however your price range is under what I'd spend there. If I was you on what you're after I'd go either Mildura Victoria if you really care about the cash flow or probably the Maddington / Cannington area of Perth if you can handle a lower yield.

    I own 2 properties in Mildura so know the city quite well if you have questions about there.
     
  17. Spiralkut

    Spiralkut Well-Known Member

    Joined:
    12th May, 2020
    Posts:
    142
    Location:
    Melbourne
    There are certain suburbs of Hobart that are still undervalued and are currently still spiking in value. Very high yields as well with people paying 400wk for houses worth 250k
     
  18. HUGH72

    HUGH72 Well-Known Member

    Joined:
    18th Jun, 2015
    Posts:
    3,023
    Location:
    QLD
    That’s probably one market best to leave alone for the time being and it see where the dust settles.
     
  19. Toucan

    Toucan Well-Known Member

    Joined:
    18th Mar, 2018
    Posts:
    94
    Location:
    Adelaide
    My mum lives in Christies Beach & her car has been broken into twice this year.. hoons doing burnouts and racing up & down the street at all hours. She looked out her bedroom window one night last year after hearing noises outside to see cops with guns drawn & torches pointed at her, turns out there was a man hiding in the bush under her window.. they were looking for him after loud disturbances down the road were reported. She has security cameras & it doesn't deter. Thats just a few issues in the past 6 months, stuff like this has been going on for years & its not getting better
     
    ndpjai likes this.
  20. wilso8948

    wilso8948 Well-Known Member

    Joined:
    23rd Jan, 2018
    Posts:
    420
    Location:
    NSW/QLD
    Townsville is another option that hasn't been mentioned. Not for the uneducated. Consider higher insurances etc. But not uncommon to see $250k houses rent for mid $3s.