QLD GC going strong!

The best attribute that the GC has is that it's got brisbane closely. Imagine if GC was isolated...
Lifestyle alone is going to be tough to sustain CG in this market. It needs the jobs that brisbane has and indeed a lot of GC residents commute to bris for work. Of course it partly works the other way round as well- gc has the lifestyle and a lot of bn residents go there on the weekends

 

Hi

We've been buying in Brisbane , but happy to buy elsewhere if there good returns and low vacancies .

Are there any suburbs in the GC which give good returns in the lower price range ?

Is there a " Logan on the GC " . Most of the capitals have one or 20 . Is there a GC equivalent ?

Cliff

 

Yeah nerang is probably the Logan of the Gold Coast. Still very cheap but good rent returns.

 

Yes Nerang which is a lower socio economic area with lots of blue collar type factory workers.

If you want a fair yield and good prospects of capital growth then buy a three bedroom unit on the Gold Coast in a walk up close to the beach. Mermaid Beach, Broadbeach, Miami, Palm Beach, Burleigh Heads. I'd be looking at the pocket between the beach and highway around Mermaid Beach for something bullet proof.

 

In 2002 , in Logan the aim , 70 k with rent of 140 .

Cliff

 

But the GC is going to get hit with a swarm of apartments like @Bryan Loughnan mentioned + the commonwealth games village (around 1300 apartments)?

I have been looking into an old walk up apartment near the water but keep getting turned off by the prospect of oversupply. Growth looks strong in the short term but i don't know if this will be the case in long term and positive cashflow is difficult to find now. Ideally we would've bought last yr when 8% yields were available but unfortunately we don't have a crystal ball.

I'm still getting my head around the GC market so any insights you have would be appreciated.

 

If history is anything to go by, then any place that holds an event like the Olympics or Commonwealth Games ends up with a massive economic hangover. I doubt the GC will be any different.
Granted the Commonwealth Games is nothing in comparison to the Olympics but it's big by GC standards.
I'd be selling out beforehand to be honest.

 

For what it's worth the last time the Commonwealth Games was held in this part of the world with a city of similar size to the Gold Coast was Christchurch in 1974.
The legacy of that is Christchurch was left with a financial facilities management debt of what would equate in todays terms to well in excess of $100million.
The City was never able to clear the debt until the lotteries commission stepped in and paid it 16 years later.
Only 1 City has bid for the Commonwealth Games in 2022.

 

I doubt these 1,300 apartments will be in good locations close to the beach (50-100 metres). Walk ups are older properties so they're in better locations which keeps vacancy rates down and promotes stronger demand / cap growth. Having low body corp fees ($30-$50pw) and being more spacious makes them a better investment than dogbox highrises with $100-200pw body corp fees. These older blocks (4-12 units) have scarcity factor and developers also eye them off. It's much easier to sell/rent a unit in one of these small walk ups than a highrise which could have 50 other units available.

Don't be put off when people go on about over supply of apartments on the GC because they're usually talking about high rises. I recommend you continue looking for a quality walk up close to the beach with low body corp (no pool, lift, on-site manager), preferably three bedrooms, unrenovated and close to shops.

 

Let's not forget that the only other city to bid for the 2018 games was the Sri Lankan City of Hambantota which has a population of 11,000 people.



The previous games in 2014 had 3 bids and the next in 2022 has only 1 bid so interest in hosting isn't exactly trending up.

 

A lot of people living on the GC want to live by the beach, I mean easy walking distance, the comm games village is not near the beach. Along the beach front from Broadbeach to Burleigh and further south have good cafes, shops, restaurants etc, good lifestyle and thats what the GC is about. Units in 3 story walk ups are in good demand, not sure for me if the yields are there now as the rates and strata and water (rates and water exp on GC) eat into your rent.

 

Thanks @Rumplestiltskin @skyfall
@ rico2011

 

I don't think there is or was anywhere quite the same on the CG, here's an interesting list of prices in Qld from 2002. I remember one of our tenants wanting to buy a place from us for $260000 at the time, glad we didn't sell. If only I had been a little more aggressive back then.
Oh well.
http://www.couriermail.com.au/news/...-and-town-listed/story-e6freoof-1226509810617

 

Good article. Interesting how most of the low socioeconomic areas of Logan did 200%-300% and the nicer areas of Brisbane "only" went up around 150%. The cheaper properties would have had better rental yields too.

 

http://www.goldcoastbulletin.com.au...anning-and-talks/story-fnjdgobq-1227590244571

This is finally happening...

 

Looks like 3 bedroom units are circa 1 million dollars.

Or did you mean apartments as well? I've noticed realestate.com.au is listing apartments as units as well, eg, this one below.

http://www.realestate.com.au/property-unit-qld-mermaid+beach-119599327

 

That apartment would have very high strata fees ...3 bedroom apartments without pools etc will be quite rare in the areas mentioned.

 

Also I dont think buying near the beach guarantees better capital growth on the coast. Have a look at the price history @HUGH72 posted. Like brisbane gold coasts cheap suburbs like Nerang had higher percentge of growth.

 

Hi @rico2011 - my original comment regarding the athletes village wasn't where it is now. It is the fact that it will be broken up after the Comm Games and spread around the Gold Coast as affordable housing. As I think I said in my original post - affordable housing is likely to be the style of property or the tenant most investors are trying to target - but ultimately - just like the massive increase in building approvals for new high rise apartments - it's all supply into an already over supplied market. As a property investor when we break it down - you are a business owner supplying accommodation/shelter - if there is a reduced demand in general for shelter (because an extra 1,300 affordable housing properties hit the market - or new developments built) - you will never be giving yourself the best opportunity to have your money work as hard as possible for you.

 

Here's an example of the type of 3 bedroom unit I like:
http://www.realestate.com.au/property/6-16-18-montana-rd-mermaid-beach-qld-4218

Here's a 2 bedroom currently for sale (3 bedrooms is preferable):
http://www.realestate.com.au/property-unit-qld-mermaid+beach-121145178

MAGNIFICENT MERMAID BEACH

Mermaid Beach is one of the most desirable suburbs on the Gold Coast, a very tightly held location and any property available on the beachside of the Gold Coast Highway is snapped up as buyers can see the value increasing dramatically. On offer is a neat and tidy two bedroom apartment in a small block of ten just 100 metres from the beach. A great property for investment or your own residence. Be quick to inspect as this property won’t last long.

Features.
• Two generous size bedrooms
• One bathroom with combined laundry
• Separate toilet
• East facing
• Large Balcony
• Security Garage
• Close to convenience stores
• Body corporate approximately $39.00 per week

Cheaper properties always go up higher as a percentage because they're starting from a lower base. People on the Gold Coast want to live close as possible to the beach. If they can't afford beach side of the highway, they go further inland until they can afford it. Buying in beach side blue chip suburbs like Mermaid Beach will always do well long term because of high demand and demographics.

It sounds like they will be mobile homes if they can be broken up and spread around?