QLD Inner Brisbane Market 'Overcooked'

@Bran This is another beauty. Small lot, good location, new modern build (though I would argue its not that great imo in terms of design/finishes, could be much better) with a nice price tag at the end that is snagged by most likely a lovely OO.

Sold Price for 57 Tranters Avenue Camp Hill Qld 4152

 

Basically supply and demand - low interest rates causing construction boom, developers want to get their projects out of the ground as soon as possible and tradies are booked out for months. Basically upping their prices due to the shortage - can't blame them, I'd do the same.

 

I moved a while ago now (2012).
Will be back there pretty soon, things are looking up. Again.

 

Surprising price for the small lot, the market must now be willing to pay a premium for a new build.

 

Yes I think so @HUGH72 . This is happening more and more. They are willing to pay good money for modern architectural designs with high specs, closer to the CBD.

What is happening is that the suburbs 5km from the CBD with this stock that sells for 1.4-16.m are willing to move out say another 3-5km and pay 1.2-1.3m, saving 3-400k. So for the people who bought subdividable blocks 8-10m from the CBD on 800sqm+ blocks for a good price 2-3 years ago will now be assessing how to capitalise on that imo. That's exactly what one of my Brissy developments will be.

 

Yeah i agree with this.
If the location is right, the market will pay a premium for new builds...provided its not oversupplied..

 

I am surprised that on this forum there isn't a lot of commontery.about the already large drops in Brisbane units it's even part of the marketing now that agents are using to sell properties "look at what a bargain this one is we are selling it for 440 and the last one sold in the complex for 480" I'm seeing a lot of pretty solid drops.

there is a Mount Druitt thread talking about how much it will drop and the people talking in that thread actually own properties in Mount Druitt it seems like the Brisbane threads just talk up Brisbane no matter what.
I stand to gain from Brisbane going up so I'm not exactly going to start a thread called 'Brisbane unit bloodbath' but it would be interesting to note that people aren't already seeing and commenting on these quite big drops in units. Units only.
Suburbs 7-10kms North are doing great for houses. Seeing it first hand with trendy cafes including licqour licenses popping up as young people move in. So not talking down bne but genuinely wondering where the bottom is for inner city units.

 

But but, the thread title is Inner Brisbane Market 'Overcooked', and the 1st line of the OP is:

 

Don't know where the bottom is but personally I would not be touching any unit in a high rise building in the Brisbane CBD with high strata, hundreds of units in the block and paying a premium for it. To me its madness, but others may have room for it in their strategy/plans.

 

There is a fair amount of commentary on risks of otp, units, oversupply etc on the brisbane and other threads.
Where is the bottom for oversupplied inner city units..dont know.

 

I probably wouldn't buy one.
Definitely considering renting one though.

 

So, as a homeowner, close to CBD, in a riverfront, high rise, 160m2 apartment, resident 14 years - do I sell or stay? Opinions very welcome.

 

Of course affordability is important, under any accepted metrics of price to income no matter how this is viewed Brisbane is considerably more affordable. I'm a little surprised you would suggest otherwise.

I'm not suggesting a boom is likely but your argument seems to be based on the IT industry, the previous Qld Govn stopped all hiring for several years. This has been reversed.
I think its terrible but are we at a point where many of these jobs are outsourced overseas?

 

What I mean is we aren't seeing people talking about the big drops. Figures. It's all a bit future talk but it's already hit unit prices

 

"IF" It's in new farm and it's facing the riverfront up high,and depending what the entry price was with that living sqm's,then the only way is test the market,costs nothing to ask the question..imho..

 

Please re-read my post. I did not suggest anything about the affordability gap. I said if we go by what you have suggested, then if Brisbane goes up in price, it is creating a self-destruct routine because the affordability gap is going to either narrow down or be completely gone and therefore become unattractive. Also affordability is one thing, having employment for the extra people who then create the demand in housing is entirely different which is why I was surprised when you mentioned affordability.

It hasn't been reversed at all.

To spend, you need budget and to have budget you need to collect extra taxes. QLD government heavily relies on collecting taxes from miners but with mining projects either shut down or reduced they will be lucky to have enough money to get by let alone reverse anything. I mentioned earlier, they were asking us (the supplier) to donate money so they can upgrade their system. How embarrassing is that?

It hasn't been reversed it has just been stopped. The reality my friend is that we are a consumer country. We dont produce anything other than raw products for the most part and the only car makers we had here have shut down. Our prime minister is going around the globe with a smile on his face and a pen in his hand signing free trade agreements with whoever that is willing to flood our markets with their cheap export.

We are where we are because of agriculture and mining and thats the sole reason why Perth experienced that massive drop. Otherwise there is no reason why Perth is going backwards at record low interest rates.

 

I'm not sure, most topics I see people talk of the probable stagnation of prices for the foreseeable future.

 

OK, considering I'm a novice at this game, can I please send out an S.O.S and seek advice on what to do if I have already committed (signed a contract and paid a 10% deposit) to an IP in an "overcooked" market. Unfortunately before I found this site, I committed to an OTP 2x2x1 in Bowen Hills.

I'm assuming there is nothing I can do in regards to the contract but what is going to happen when I approach my bank (and/or other banks) for the cash? It appears that they are likely to say you owe X, but we're only going to give you Y (the valuation in 12 months time). So in these circumstances, I assume you just fork out the gap (between X & Y).

Is it as painful and simple as that???

 

Big drops already.

 

Yes that's what's happening in melbourne. Buyers having to come up with say 90 instead of 80% depends on lender and depends on evaluation. There are good brokers on here who can help advise options about lenders and how they value.
Bowen Hills is good though generally as an area. Good transport. Just don't expect the rents you might think when your apartment comes online.