QLD Logan H & L packages

Hi Guys,

New member here so please bear with my basic questions. Seeing a lot of H & L packages in Logan reserve, double occupancy and claimed yield of around 6%. Priced around 560K mark. Land around 500 m2.

Any ideas? are the yield numbers real (with double occupancy)? and is double occupancy really prevalant in Logan?

 

Yield is a bit of a sleight of hand. That probably based on one property on a good day and they may have even leased it out with a deal to overstate the rent. Is it repeatable ? 5% may be real and achievable. Of course this is a bare bones new build to budget spec. Modifications may pull yield down.

That is gross yield. Actual all in cost of property incl of duty and legals isnt used. And the gross rent is used which is before ownership costs, loan interest and PM charges. You would also need to consider cashflows overall after deductions for depreciation etc

 

Downside with something like that is you're probably only going to sell to an investor , so potentially going to limit Cap Growth .

Yield of 6 % is nothing to write home about , in-particular for a non standard home .

I'd be looking else where.

Cliff

 

I am not sure logan reserve is the first place i would go to for new build even before considering yield.

New builds in 4131 might be fine. In Berrinba, Cornubia also.

Also older houses.

 

Don't buy those rubbish dual occupancy in Logan mate. In Brisbane you need to go for < 10km from CBD for strong capital growth. Completely different terrain and geography to Melbourne and Sydney. Logan reserve has too much land West, South and East of that area. Save up a bit more and buy an established house on land < 10km from the Brisbane CBD for strong growth. Good Luck.

 

Crap . Every cycle in the past , Places like Logan , Goodna , Caboulture , ipswich have doubled and in some cases significantly more ...

Horses for courses , Lots of people on the forum ( Including me ) have good money buying cheapies in Brisbane . But having seen things on the forum in recent years , I wouldn't be touching dual occs in Brisbane , in particular if I need to come on to a forum with people I don't know , asking them if it's a good idea . For me that answers your question .

Brisbane booms like most other places , starts centrally and then moves out . From what I hear , the Centre is booming . Not sure about the middle cause I'm not watching it . Where I'm holding
has gone up between 10-20 % in the last six months and IMHO , that's just the start .

Cliff

 

The Gold Coast is not 10km from Bris CBD. I think this theory is last century. This century Gold Coast grew uo. Jobs in Logan went up. And recently the CBD was emptied.

The ripple is from lifestyle property inwards NOT from the CBD.

Edit. Oh and th latr breaking news is that the infra spending on transport in budget is strengthening Logan rail to improve the Gold Coast link.

 

I have cheap assets (houses) held in Logan City Council. I also have blue chip assets held in inner North Brisbane, Inner south, and Middle ring suburbs. From the past decade my Logan properties have significantly underperformed compared to my inner 10km properties. I have only managed to enter the Sydney and Melbourne market through equity built in my inner Brisbane houses. My Logan properties have done jack all except give me a positive cash flow every month. My middle ring Brisbane has gone up so much this cycle I'm ready to buy another one in Sydney.

I'm still waiting for some hardcore equity/growth in my Logan assets.........LOL hope it will come with this current boom....Oh wait my Woodridge house has moved 50K....woopy doo....

 

In terms of % though that would be significant. If you bought that for $300k and it moved $50k that is 16.67%. Depending on your timing and luck that would be decent. Plus arent they so much + geared that you can just relax and let the rent pay off the mortgage?

Just sit back and collect rent and watch the loan go down while your doing it. It will increase over time. Logan is currently in the top 10 hottest areas in the entire of Australia according to some of the latest articles.

P.S Woodridge wont be leading the Logan boom. It will be areas like Springwood, Daisy Hill, Shailer Park, Loganlea, Loganholme, Rochdale South and even the up and comers like Marsden (which have had several record breaking sales recently), Crestmead etc....all these places are moving and some very nice prices achieved in them now.

 

Yeah Thunderstrike888 that's why I haven't sold Logan yet, I'll probably sell in my retirement or use them to transition to a cash flow strategy later on. But for now I need strong capital growth which my Logan properties haven't really produced. Even my single Geelong property which is a "Regional City" has outperformed all my Logan properties in the past decade. It obviously doesn't cost me anything to hold these cheap Logan houses but it's not ideal when I'm doing a portfolio review every 12 months and Logan hasn't moved.

 

Well to be fair the ENTIRE of Brisbane hasn't moved for the last 10-12 years not just Logan - LOL. Thats why all the long term investors are soooo happy now that Brisbane is actually moving now. Its only recently that things have started picking up bigtime. Plus in Logan there are 70 suburbs so you need to buy in the right ones.

Just hold them. I've got properties that have performed and ones that have not. ALOT of ppl are looking for exactly what you have which is cashflow positive properties and these days its VERY hard to find that.

If your looking to grow your portfolio your cashflow is actually what is keeping you in the game. Without it you got no chance of growing your portfolio no matter what you do especially after APRA came into the picture.

 

Comes down to timing . You can look at any ten year time frame ( I do , it’s the first think I look at ) and find places that have underperformed . That gives you a clue as to which places will overperform in the next ten years

If you’ve held Logan for the last ten years it has underperformed . I don’t think anywhere I’ve said it’s been a great performer in that time frame . 6 months ? Ok .

We bought in goodna / ipswich around five years ago . In two occasions since then the market has started to move but external forces stopped it . Too early , maybe , but when we bought , there was plenty on the market , so we could take our time looking for nicer properties , and the number we wanted . Interestingly one property just sold 25 % above what new paid and the markets really only been moving for the last 6 months

just over ten years ago we bought in Mosman / manly in Sydney at a time when Sydney had underperformed . Since then , they’ve over performed . We sold those and bought in Hobart , Launceston and brisbane .

In the next five years , you’ll probably find out ring brisbane will out perform inner ring .

while we made a very nice cap growth with Mosman , the cash flow was a pain but it enabled us to pay off our weekender .

cliff

 

I wouldn't say Brisbane hasn't moved.
I purchased Ashgrove, Brisbane ( Ashgrove State School Catchment) in 2015 around the ~550K mark. I also purchase a Logan cheapie in early 2016 for ~250K mark. The Ashgrove one is now valued at 1.0million+. My Logan cheapie is ~300K. Ashgrove has made me ~100K per annum.
Obviously Ashgrove is negatively gear and I bleed every month to bridge the mortgage repayments. But that 500K equity allowed me to purchase in Melbourne and Sydney with ease.

Logan on the other hand just buys me coffee every month.

 

What if you'd bought 5 Logan cheapies in 2015? If you bought well you might be up 100k in the same period per house and all cashflow positive.... Not bad going.

 

No thanks. I Don't need 5 set of tenants. 5 sets of property maintenance per year. 5 sets of Logan council rates. 5 sets of water rates for an area that has underperformed even relative to the national inflation rate.

Investment like shares/ managed funds/Superannuation/Property is aimed at hedging against Inflation.

Australia's inflation rate over the past 10 years is historically around 1-2%

Marsden 4132 ( 10 year growth growth 1.24%)
Ashgrove 4060 ( 10 year growth 5.57%)

Why would I want to invest in houses that can't even beat inflation? LOL

 

^ The main issue here is your timing NOT the area. Same thing happen to me in St Marys/Mt Druitt etc..... in Sydney. Performed like a dog for many many many years yet it was all positive geared but not much capital growth. Now they are all worth a heap of money and triple/quadruple what I paid.

Timing has ALOT to do with it. Someone that just bought last year in Loganholme for low $300s already made $100k within 12 months. That person would be loving Logan.

In your instance you bought way way way too early and got stuck with a dog for the last 10 years. But now its moving so its just purely a timing issue. Alot down to luck as well.

Also as I mentioned before Marsden etc...are secondary tier suburbs of Logan if you look at Shailer Park and other suburbs I mentioned above...the growth is good. You also bought in Woodridge - that is probably not even in the secondary class most likely 3rd class so it will take time for it to grow.

 

Exactly. Houses in Logan virtually quadrupled from 2003 to 2008. The average Logan cheapie went from 70k to 300k.

 

Yeah mate I completely understand. I have vested interest in Logan as such I would love to see it boom.

If I could turn back time I would not invest in Logan at all.

I would try to so call " Time the Market " and Speculate when Logan would boom and jump in like you suggested. So yeah don't "Invest" in Logan guys , just speculate and try to "time" the Logan market.

 

If you want to make money in Logan i suggest adding some value, not just sitting and waiting, there are properties that make modest amounts in poor times and great amounts in good times. But i don;t think that is everything. There are properties giving good rental returns.

Gains can be increased by adding value. Reno, Granny Flat, development.

Oh AND sitting back and riding this boom

 

Thanks. Does block size matter a lot in suburb like Loganlea? For older houses with huge blocks, do you seen subdivision opportunities in future?