QLD Flood areas in Brisband and effect on value and appreciation

With Brisbane property that is in flood area, but never been under prior & no negative insurance impact, how is that land likely to perform, will it follow the surrounding non flood pricing, or is it it's own animal.

Looking at a place that seems to be about 80 k less than similar properties, even if larget floods than past came through, it is highset & there are many lowset on the street.

What are your thoughts if you are familiar with Bris property in or near flood areas.

Out of interest, I have looked at a lot of the land in the south east, and even in places like redcliffe, they are all only about 5m above sea level, so lots of property could be effected by certain events, this is about 5 m, but not near coast (not a few hundred m anyway.

 

Don't know but if it helps you when I look at properties in Brisbane I cross them off as soon as they are marked as flood effected on the map. Don't care if they never flooded in the past. Fwiw if the market goes up those properties will too but it severly limits your market of interested buyers. You buy cheap you sell cheap.

 

Agree with Biz.

 

Yes, I understand it limits who you may sell too, it is the only reason the op has not gone in a week

The location will mean always rented, and return will be pretty good.

That is really what I am trying to determine, can go to Logan, Ipswich etc, but the actual Bris area may be better, but I guess only locals who have watched closely would know, if a large flood came today, I know people will be put off. If it follows the market, only downside is hard to sell if market is down, longer days on market to sell, but it will appeal to someone. I do not want to throw in more really.......

There is another place with same size block, but better house, would be in same effected area on maps a few hundred m away, it is priced 150k higher (but that does not mean it will sell, and 150k is a big discount for someone to put forward, house is better, but probably only by 30 to max 50k, if that makes sense.)

if it is true, that they will follow the market, then that is fine, anyone followed flood effected places in Bris ?

 

Hi, I used to own one in the flood zone, the water did not reach the house but the insurance premium jumped to $1500/y. Yes the pricewas cheaper and rates were cheaper too as the land valuation was about $100k lower to similar properties not in the flooding zone. Rent was good but limited capital growth. I would rather buy one not in the flood zone, as the stress i went through during the 2011flood was much to take.

Thanks,

Anne

 

Hi Anne, thanks for that, Suncorp, consider it normal it seems, they quoted 1100 , NRMA higher as they said 2k

I won't live there, but if 74 and 11 floods did not bring any water to the street, and it is highset, it would have to be pretty big to be 2m higher than prior I would think, basically it would need a large normal flood plus king tide and other storm/tide event.

Checking the rates to a few hundred m away where it is higher is a good idea.

How did it limit capital growth ? did it not track other areas % wise ? Where was yours located (PM if you do not want to tell everyone area)

Ta

 

Capital growth is limited because the previous owner did not make much money out of it and neither did I

We bought it on a discount and so sold it at a discount.

I guess it depends on what you are looking for: capital growth or rental yield, but in hindsight, I would rather pay to get A category property than B category.

We were attracted by the discount.

My next purchase if any will be in the flood free zone.

Ta

 

The only thing that is important, is if the capital growth is the same % wise, if it tracks same, or similar, for investment, it does the same thing.

Different prospect when you live in it, but the numbers would be the same, assuming you did not sink money into renos.

I will have to look at other flood areas close by and see if I can work out if it tracks same or not, assuming not trying to sell during a major flood.

 

I recently purchased 2 house in Logan area, sight unseen.
B&P inspector ask me to walk away on the property I am buying.
One Lender simply rejected the security
Alternate Lender gave me really hard time and my broker basically had to sleep with the lender's BDM for them to lend me money on the security..

But when I see a light blue patch on pdonline, I move on without looking back.

 

Hi RetireRich, that is not very well thought out, and I don't want to sleep with anyone

I am not even sure what the light blue is, is that someone using the council maps ?

Do you have any historic info on increases in flood v non flood next to each other ?

 

Hmmm, interesting. I'm looking at one now that I've just realised has a 'blue line' circling it. It only just scrapes through the three adjacent properties but fully covers the one I'm looking at.
I originally looked the other interactive flood mapping tools and no flood has ever come within 100yards but when checking the BCC PD Online the property is covered in light blue.

What effect does this have on finance?

 

I am not so sure it would worry finance unless it is known to go under, you will find out I guess when you go for unconditional.

The maps are council maps, and from where I looked and talked to locals, water has never gone near any of the properties, but the council map probably looks at every possible condition combining, say heavy rain, river or creek already overloaded, dam releasing water and king tide, then lots of new things will get wet, also they have to guess what developments since last major events will do to flows etc.

What suburb you looking at ?

I just got approval for one where the blue line is right next too, insurance is cheap too, so that tells me the locals are right that it has never flooded.

 

How cheap is cheap? Have you checked their definition of flood?

 

Sorry to hear what happened to you Willy. When a house gets flood up to the roof what do you need to do to bring it back up to scratch? I would have thought by that stage it is time to call in the demolition crew and call it a day?

 

Cheap is 1k for full cover, costs slightly more in another location that will never flood from same insurer.

Yes, flood covers a few things, I am talking about flood from near rivers or creeks connected to rivers, local flooding can happen anywhere.

As will is saying, the insurers know the hot spots, they know where the claims for flood from river is likely to happen over and over and the cost to insure reflects that.

 

Who was the insurer if you don't mind me asking? I'm guessing Suncorp or AAMI?

 

I saw you talk about this one before and what it caused you.

Pretty devastating.

 

Yes, Suncorp. I checked with others too.

On one that I started this thread in regard too, one insurer had a higher permium and they could not tell me why.