QLD Herses Road Estate Eagleby

Hi Everyone

I am planning to buy my first IP and I am looking at herses road estate Eagleby. There are some house and land package available there. Some are dual occupancy with possibly positive cash flow. Could you guys advise me if its a safe option?

 

The estate name is a no go zone - almost as good as Cemetery Road or Dungeon Lane.

Does it have a historical link to the name? Anywhere near the morgue?

 

Hi Abudh,

Good on you for starting out with the first IP

For Eagleby, be mindful price has already had some movement since 2 years ago when 3/1/1 houses were available between 200K to 300K. Nowadays mostly seem to be in the 300K range with very little stock sub-300K. How much are they asking for the new H&L package and what is the forecast rent?

Also vacancy rate is currently sitting at 3.6% according to SQMResearch so I suspect there will be lots of competition in getting a place rented out. Worst case you may have to drop the rent to attract tenants, which will have an impact on your yield.

I would suggest you do more due diligence at the suburb level and have look on RE.com.au to do comparisons between the H&L package you're considering and what's already on the market. This should give you some idea whether this H&L package will be a sound investment.

Cheers,
David

 

Hi David,

Thanks for the reply.

H&L package is around $480K with dual occupancy. possible rent combined will be around $600pw.

 

Eagle by is a very hard surburb to find quality tenants, it a very very low social economic surburb, if this is a new build you might want to consider suburbs like Loganlea, Waterford West or even Marsden or Crestmead where you will find a better quality tenant, these areas also have better facilities and infrastructure (close to hospital, TAFE, Griffith university, Train Station, etc

 

My 2 best tenants are in Eagleby. Never a day late with rent, properties are spotless and treated like they own it. Going strong for years...

General rule of thumb is house and land packages in Logan are never a safe option. I do see quite a lot of 2 - 3 year old distressed houses from people who overpaid on their house and land and can't afford it anymore though - take from that what you will

 

I agree with you there Simon you can't place everyone in the same basket, however Eagleby is a very low grade area with tonnes of social problems, high unemployed.

As a property manager I often see out of state investors paying more than locals, it really pays to do the research.

 

Hi Abudh,

Eagleby is a 'pot of gold'. It's water based, surrounded by the Albert and Logan Rivers with ocean access. Why not google aerial photo. Your more affluent residents live here on riverfront acreages in Albert St, Eagleby Rd, and Curlew Cres with plenty of owner occupied pockets.

Would investigate other properties before investing Herses estate to compare value and return as they are there. Eagleby has highest capital growth and rental yield % to surrounding suburbs.

Managed over 100 rentals in Eagleby bet 1997 and 2003...no real problems compared to other suburbs.

As for historical link which I saw above aboriginal name is Eaglebilyara 'Nesting place of the Eagles' King of the sky' can't be wrong.

Cheers

 

The developers of the Herses Road development, Heran, have been flip-flopping about Dual-Occupancies for some time, so just make sure the option is still on the table.

If you can get a Dual-Occupancy in there I think it's well worth considering. It's $20,000-$40,000 cheaper than a Dual-Occ anywhere else in Logan and shouldn't be too difficult to rent. I believe they're also a bit negotiable on the land if you push with the right terms.

The area does have a very special reputation, even for Logan, but it's likely to see some good growth as the whole Pacific Motorway corridor powers upwards. Just keep in mind it's going to be largely very basic investor stock in there, mostly likely poorly managed and surrounded by the rest of Eagleby. With a good PM you can control your property, but there's nothing you can do about your neighbours.

 

Good cash flow can be achieved there at a much lower price point than a new dual occ house and land package. Best to hold out for a better deal. If you know where to look there is still some good opportunities to pick up a great deal on older stock where you can add value or buy under market price.