QLD Gold Coast or Brisbane - Advise for IP rookie buyer :)

Hi,

Looking for some advice regarding my first IP with a price range of 400-500k.

Some info about me and my "strategy" :

- Single income full time professional (corporate) working and living in Sydney with loads of work related trips up the NSW coast and potential to visit the Gold Coast while I am at it
- Pre-approval with one of the big 4's just came through so ready to go
- Went for a "scout" on the Gold Coast recently and really liked Burleigh Waters and Currumbin Waters but not so sure either will provide much capital gains in the next few years?
- Open to consider Brisbane suburbs (north I guess given my budget)
- Townhouse preferred with buy and hold intent (to be let to tenants but potentially planning for renovation in a couple of years)
- Considering lowering my budget to 350k with a view of buying second IP next year within my max borrowing power (confused a little if this is good thinking)
- I have considered using buyers agents but changed my mind as I'd rather learn in the process

I have been monitoring the sales / lettings market in Burleigh Waters and it looks like some of the townhouses on sale stay on the market for quite some time? Also it appears that demand for rental (2/3 bedroom houses) is high here so I am thinking I should just pull the trigger

AS you can see I am quite the rookie so any advice is much appreciated!

Murri

 

Hi!

How will this purchase help you move forward in future and tie in with your goals?

I do understand having a lower budget helps you buy 2 properties - but how will you ensure whatever you buy is a quality asset.

Even if it is lower price point, you want to ensure the asset is well located to allow an upside over the long term - there are a lot of properties in the suburbia at lower price point, that I feel may look good on paper, but you need to consider how these bring you closer to your goal.

In the current lending environment, in my view, you may want to consider quality vs quantity.

Some of our clients who have started their portfolios with interstate properties, have found value in working with locally based buyers agents who can inspect properties, and provide quality input, helping them make informed decisions. This will be a learning curve for you too.

 

The Gold Coast market has done quite well recently. Keep in mind that the GC and Brisbane markets operate quite independently and one can be hot while the other isn't so you should have a think about which one you think is going to go strong next based on the fundamentals.

Keep in mind the GC had a lot of hype with the Comm Games which is now over.

 

Thanks for all your replies

At the moment I can't "afford" BA fees as that would reduce my borrowing power (relatively low deposit around 17% to Value) however I would be open to recommendations for BA's on the Gold Coast as I know some offer different packages.

In terms of Brisbane realistically the only suburbs going for townhouses within my budget would be North (Boondall, Kedron, Carindale, Redcliffe) - I don't know Brisbane at all that's why currently I am wired to prioritise the Gold Coast

Having said that I keep hearing Brisbane has not "boomed" yet. Have spoken recently to a BA (friends bought IPs through them) and they were talking about either the Gold Coast suburbs near Burleigh or Brisbane (especially Manly)...this is why I am considering both scenarios

 

Carindale is on the south side of Brisbane.
Marg

 

It's 17% including costs (LMI, conveyancing etc)

 

LMI can be capitalised on top of the loan, unless you do not have the borrowing capacity for it.

Are you looking to pay it in cash? If so, what is your reasoning behind it?

 

I am getting LMI capitalised but even with that my current available deposit is only 16,5% of the max purchase price of 500k - I could get a BA fee into the equation by lowering my budget to mid 400s

Any recommendations for BA's specialised in the Gold Coast?

Thank you

 

Gold Coast - Paul Flynn & Santosh Nune of Paul Flynn properties
Brisbane - Andrew Allen of Allen Real Estate

Our clients have worked with both and have been very happy

 

Thank you!

 

I wouldn’t def prefer GC Over Brisbane if considering a unit/townhouse but detached homes are really the only game in town in SEQ

We don’t have the population levels or addordability constraints to push up attached dwellings.

My mermaid waters unit rents out within 2-3 days. GC vacancy rates are lower and yields higher than Bris. Anecdotally from my prop manager due to the transient workforce in GC, there is real demand for FURNISHED units.

I generate $550 a week gross on a furnished unit which cost me $345k and it has gone up probably 100k in the past 5 years.

A nice bright canal-front unit on a high land value block would b a good choice . Broadbeach Burleigh mermaid Nobby would b all good area imo.

GC is more “compact” and there is more land scarcity near the prime beachside areas whereas in Brisbane there is land out to Toowoomba and Caboolture that can be developed in theory.

Just don’t expect phenomenal growth. GC is also v cyclical and doesn’t grow and plateu like the bigger cities

 

So I followed your suggestion (thank you) and reached out to Paul Flynn's office. Ended up speaking with Santosh (really approachable guy and quite honest), however when doing a bit of DD I have found very mixed reviews regarding their BA services? They seem to operate quite differently from the other QLD based BAs (I don't mind different) however I cannot find a lot more on the web regarding feedback (besides an old thread on somersoft with some negative comments )

I was wondering if anyone had other recommendations so that I can make a few more phone calls and make an informed decision (at least based on my research and interactions)?

 

Hi @Murrilondon80
What Rolf said
Speak to a few different BAs and see what they have to offer and see who you connect with best.

 

I'd be looking for a house on a decent parcel of land within 15km of the Brisbane CBD. I bought one a few weeks back mid 400's 3 bed 2 bath 2 car on 600m with room to add value. There is scope to make it into a 4 bed property but for now we are just doing a small cosmetic reno.
rental yields currently are 4.2% but could be pushed to 4.5% depending on the level of renovation.

I agree with @Property Twins in quality over quantity, I feel one a grade asset over two b grade assets is going to be better for you and you're reducing your risk significantly.

 

I guess I am going go with my instinct after a few phone calls / meetings as I am also aware people tend to leave reviews more often when something is wrong than the opposite

 

that's great - I didn't think you could find properties that fit that description within 15km of CBD anymore (in that price range of course)

 

Hi - wanted to give a plug to Paul and Santosh. I've personally done a few deals with Paul over the last 8 years; mostly buy, reno and flick; however, the last three have been solid buy and holds with upsides both in terms of instant equity and strong rental returns. Paul was introduced to me by my accountant in 2000 as he had helped him buy a penthouse on the Gold Coast over that severely depressed market.

I've recommended both my family and friends to Paul (and Santosh who joined the business a few years ago) and they're happy customers. Karina, their ace property manager, has been managing our properties in the Logan and GC area over the last few years and is tough but fair. So essentially, they run a one stop shop and provide an excellent service to Sydney Mum and Dad investors, like me.