QLD My house in Logan didn't do so well, why?

Realise capital gain then you know its value.

 

Corelogic sells most of it's data to agents/industry or investors. It makes more selling good news stories than bad (but bad for some is good for others), what can you say about a stagnant or slow moving market?

Inside a pile of turds, there may be a gem but you've gotta polish a lot of turds to find that gem.

 

Hi There arenscape.

I have declared my preference for upper middle logan on other posts, and I am not sure Eagleby is where I would invest ...... but there are significant reasons why u might be OK in the medium term and why the short term is not terribly good. There was an awful record breaking flood not long ago, and Brisbane takes 7 year to drink enough amber fluid to forget about a flood - those brain cells are persistent. In logan they drink more and therefore forget quicker, but don't let me wax lyrical about my neighbours, just let's accept the flood may have a short term negative effect. It was a record one, so no greater flood is expected within the forgetting period of 7 years.

On the upside the whole of the M1 is a carpark in the wrong direction!! That is that the good folk of Brisbane are driving to the coast at 6-8 am and and returning about 3pm (need to get home to drink enough to forget about the flood). It seems that the joining of the two urban areas (Bne / GC) is really fast approaching ..... the middle bit being Eagleby / Beenleigh.

I don't like eagleby myself, but I reckon u will be OK soon.

Clever dick with the gold watch maybe should give a proper answer. I reckon your question is a good one, deserves a good answer. I would introduce you to my local drug lord any time.

 

That's a bit harsh!

You do make a point though....

 

That's some good buys

 

If the BA is sending all clients a xmas review of their properties, it is probably the auto generated report out of Core Logic where Core Logic chooses the "comparables". Unless you spend time digging in and nominating more sensible comparables (similar area, blocksize, construction, facility and condition) the estimate can be quite off. For instance it might be comparing a run down fibro home on a small block with a renovated brick home on a large block.

It is possible the report has estimated the value correctly but it is also possible that it has not. Your property mught be worth either more or less than the report says.

 

Way too early to expect a massive increase for an area which I think it's for cashflow purposes. Maybe you may experience alittle bit of capital growth if you give it abit more time for it to happen.

I also think that it's a good thing that your investment is not going backwards which is a good thing. I do agree with some of the other comments mentioned that due to the media, property investment magazines and stuff you see and hear about in Youtube, people do have unrealistic goals. Majority of the investors that you see in the magazines, made purchases when the prices were lower (early part of the property cycle) and lending was easier. Nowadays, just to attract an equity release takes so long and paperwork, when in the past it was a relatively straight forward process.

 

If the property did have a market value of $300k why were you able to buy it for $285k? it was probably worth slightly less than you paid for it as if the market had risen 10% your property would be worth about $313k now.

however it might be worth more than this valuation as it is just a computer generated one.

 

You haven't even had the house for 12 months yet, without knowing anything about the property you bought the median house. You even said it was a little optimistic and very rare does someone get something BMV as in reality the MV is determined when sold so $285k was MV.

The median value as at 31 December 2016 was $285,000 which is the same as your purchase price and is now $300,000. With a yield of 5.5% and a growth of 4% for the last 12 months (Dec16-Dec17) you are tracking at 9.5% total return for 11 months or about 9.8% p.a. return if it does the same for the next month (4%/12 = 0.33% per month).

Although not ideally you would want 10% return p.a. but I would still accept 9.8% if I knew it was guaranteed each year (nothing is though) so you have still done well. You will not always pick winners right off the bat even with a BA as it is very difficult to pick that exact moment when something will boom. If you were expecting the property to grow by 10% that would equate a 15.5% total return which Brisbane appears to just start to be increasing.

As a comparison where I bought in Nov 16 (so roughly same time frame) the numbers from RE.com is 7.5% growth with 3.7% yield or 11.2% total return - however my property wasn't the median so my yield is less but I would assume my growth is more (huge land size).

Below is my very quick DD for you of Eagleby which I referenced above.

 

What part of Logan? Was it newly built? 3beds will not appreciate as quickly as 4/5ers. You will have to be patient.

 

People say that shares are volatile but I find property volatile too, just over a longer period.

I bought my first IP in Heidelberg Heights in 2007 when the median price was $380k for a 2 bedroom house. The median shot up to $505k by 2010 and I thought I was going so well! Then by 2012 it had dropped back to $433k. I thought that was terrible! What happened to all those price gains?

The median house price for a 2 bedroom house in Heidelberg Heights is $757k. The "boom" has really only happened this year, from Jan, when the median was $587k. So, the median has gone from $587k to $757k in less than a year.

Prices go up, then down, then up, then flat, then one year the price can boom. I feel like it has been a roller coaster.

 

No offence but if you are buying with everyone else and once it's a hot market if you get massive growth. It's more luck

The true gun investors buy well before the herd does

 

One year in Logan is nothing, you’d be lucky to be able to substantiate any capital value increase.

Who told you the market value was $300k? The BA?

Most of the data from organisations like CoreLogic are not really appropriate to be applied to one specific property. It doesn’t know anything about your property except the rooms and land sizes, nor about anyone else’s home. It’s a great starting point but totally useless to you at this point.

You can’t expect the BA to send every past client a detailed updated valuation, so I understand why he/she would have sent you a pre-generated report. You also have to keep in mind that they now have a vested interest in showing your property in a positive light.

 

Property is one of those investments where you buy and "forget". I looked at mine about twice a year, and that's probably too much already! If you're after quicker gains, you'll need to doing something other than buy and hold or go to another asset class.