My Brisbane Sub-Portfolio - is 2018-2021 the years for growth?

Discussion in 'Property Market Economics' started by sash, 31st Dec, 2017.

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  1. sash

    sash Well-Known Member

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    On the back of my Victoria sub-portfolio....people have asked me what about Brissie and when will it grow. ....

    My Victoria Sub-Portfolio

    Patience is a virtue I am told...:)....I truly believe that Brisbane will have its time in the sun over
    2018-2020..as Sydney and Melbourne turn down after over 5 years of stellar growth.

    My portfolio in Brissie has not performed as well but look to the future...the only saving grace is that I get about 120k rent..so it is not costing much to hold these...and slightly CF positive. A lot of the interest rates on these were fixed at somewhere between 3.89% and 4.29% for 2-3 years. ;)

    Deception Bay bought in 2009 for 235k...now worth only 315k
    Margate bought in 2010 for 251k...now worth 390k
    Annerley Unit (T/H style) bought in 2014 for 262k...now worth 315k
    Moorooka Unit bought in 2014 for 260k..now worth 320k
    Annerley Unit bought in 2015 for 289k...now worth 325k
    Strathpine house bought in 2015 for 301k ...now worth about 430k
    Clontarf house bought in 2016 for 325k....now worth about 450k.

    As you can see I have spent abour 1.923m...excluding stamps and other costs. ...current value is only 2.545m.

    I am hoping that the portfolio is worth about 3.9m at the end of 2020......lets see what happens.

    What is interesting...I was in the same conumdrum with my Melbourne portfolio in 2016...I was even thinking selling Werribee and Melton South....and then suddenly in 2017 they took off.

    So the moral of the story is patience....another $1.5m in equity will not go astray.;):p
     
    Last edited: 31st Dec, 2017
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  2. JDP1

    JDP1 Well-Known Member

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    Yes.. Patience for Brisbane...maybe great grandkids will see a boom in Brisbane. And that's only a maybe...no assurances even they will see a boom.
     
  3. sash

    sash Well-Known Member

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    I certainly hope that happens before your great grand kids....:D...it will happen....give it about 2-3 years..it is definitely moving up there now....
     
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  4. Jamesaurus

    Jamesaurus Well-Known Member

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  5. willair

    willair Well-Known Member Premium Member

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    Thanks for posting those location,interesting to see the Moorooka -Annerley price wise as some of the unit'sin those 2 inner southside semi blue chip have been on the market for over 6 months and through the second real estate company from what our daughter looked at recently..but well done..as 2018 is crunch time from what re's tell me..
     
  6. Noobieboy

    Noobieboy Well-Known Member

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    Interesting, you are very lucky. I have been monitoring Unit prices in Moorooka and surrounds and it seems there is a bit of discounting. Glad to see your places are not affected. Rents did not move since 2013 and seems they are starting to decrease now.

    Example: 1/8 Blackburn Street, Moorooka Qld 4105 is selling for less than what it sold in 2009
     
  7. nth brisbanite

    nth brisbanite Well-Known Member

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  8. nth brisbanite

    nth brisbanite Well-Known Member

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    I noticed that Deception Bay hadn’t moved as much as you would have liked although 80K equity over 8 years is not too bad. What are some of the reasons for this relatively ‘poor’ performance? Is it is still
    thought of as Depression Bay? A friend of mine has just moved out of the area because he wants his kids brought up in a better environment. How do you think DB will perform in the future?
     
  9. JesseT

    JesseT Well-Known Member

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    Hedged all your bets in the North Sash?
    Less confidence in the south east?
     
  10. sash

    sash Well-Known Member

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    well for one it is TH style andcthe Moorooka unit gatage can park a small boat. Some discounting in the short term but unit supply os not huge

    Great points....but but it is also important to note that the Brisbane market will be driven by more locals and people moving there to live.

    That means some of the lower socio areas in Logan will experience much less growth this cycle.

    I am seeing some people speculating or land banking in Logan....now that is seriously silly. The funniest thing I have seen is people trying to develop T/H in Lower socio Logan. Thay is a quick way to the poor house.
     
  11. sash

    sash Well-Known Member

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    I think because the market has not moved...but the place has potential as it is the cheapest suburb near water. Based on the previous cycle...it moved from about a 100k to high 2s.

    This cycle it will probably hit a median in the low 4s when the market moves....at some point.
     
  12. sash

    sash Well-Known Member

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    So I don't start a ****** fight...if you mean Logan..parts are okay..but a lot of southerners are buying in the higher yield lower socio economic stuff. In my view this is not the way to go as some of the prices have come off and has caused rents to fall.

    As you can see most of the better suburbs in the North have done very well.

    Having said that Brissie is looking good for 2018

    Qld’s property market is tipped to continue its solid performance through 2018 with stronger price growth - realestate.com.au

    I will sell out once by stuff grows between 60-100%..by 2020-2021. I am going to use the Farmers strategy more....;)

    Farmers Strategy to Build Wealth - oldie but goodie
     
    Last edited: 1st Jan, 2018
  13. JesseT

    JesseT Well-Known Member

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    Yes was referring to Logan.
    I have 2 in Waterford west which I suppose you would categorise 4-5.

    Farmer strategy sounds well suited to the current market. I like the sound of taking money off the table and deleveraging when properties have ran their course if funds are needed to finance purchases in the next growth cycle elsewhere, particularly in low-socio areas as hard work to hold through a flat market.

    Back to your portfolio, what is determining your current values? Bank val from each lender, your own opinion from comparable sales or are you using desktop valuations?
     
  14. sash

    sash Well-Known Member

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    Mostly base on my own research and comparable sales.

    People are saying that units are not good investments. The ones I bought are on 6-10 packs...the underlying land value is more than selling the units selling separately.....also not way they can build the project for that.....it will cost 450-500k for a similar product now. In the next 12-18 months the unit supply problem which is limited to 1-4 klms from the city will correct...and they will head up.

    Have your Waterwest properties gone up much?
     
  15. JesseT

    JesseT Well-Known Member

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    Not much yet, made some money on the way in with my second purchase.
    3 bedder 2014 paid 310, rents 360, current estimate 330
    5 bedder 2015 also 310, rents 420 current estimate 380
    Both cashflow positive before tax.

    Median has moved from 326 in 2014 to current 360
    I’ve watched days on market decrease consistently since then and number of sales on a steady increase, vacancy rates still low.
     
  16. sash

    sash Well-Known Member

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    What do ya think these will be worth say in 2020 when Brissie moves? I have an idea.....but lets compare notes....
     
  17. JesseT

    JesseT Well-Known Member

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    Very well, I’ll leave it here in black and white for you to resurrect in 3 years.

    3 bedder 440
    5 bedder 480
     
  18. sash

    sash Well-Known Member

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    Pretty spot on.....I would said based on 30% gain...

    3 brm....430k
    5 brm.....490k
     
  19. Seby643

    Seby643 Well-Known Member

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    Hey @sash when you have built a property interstate in the past. Have you frequently visited your block of land during the building phase, or did you have a company manage the process (e.g final handover of property) while living in a different state?
    Would like to hear how you have done it please :)
     
  20. sash

    sash Well-Known Member

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    I have done it the following way:

    1. Due the initial due diligence via boots on ground. ....even if the land is untitled and conceptual..I want to see where it is located.
    2. As for the build phase I usually just get the builder to send me photos.
    3. I do visit the sites when I can ...but not in a formal way..
    4. The final inspection is when I get really strict.
    5. Handover will usually be done by my nominated agent.