Join Australia's most dynamic and respected property investment community

Qld Central Coast - Bowen Basin - Opportunity with Mining Downturn?

Discussion in 'Where to Buy' started by robboat, 30th Dec, 2015.

  1. robboat

    robboat Well-Known Member

    Joined:
    20th Jun, 2015
    Posts:
    56
    Location:
    Sydney
    Been following some ideas around this broad area for an IP.

    Puzzled with the long term effects of the coal industry downturn over the next 10 years.
    Loss of jobs & investment has lead to a downturn in many coal mining orientated towns and this downturn will flow out to the service centres for these towns.
    With this fall is there a chance that commercial and government operations could reduce or close in the near term?
    Or is there enough support from the existing population base to allow some towns to remain viable?

    There seems to be more pain for the coal industry and Qld generally - but this may open buying opportunities?

    Looking from Rockhampton coastal areas down to Maryborough and inland to Emerald on main road routes.
    Understand that there will be little to no CG and weakening yields now - but what is the long term outlook?

    Seeking some forum opinions before I go further and travel to check it out......maybe you have an IP there?
    Or is it all a basket case?
     
  2. bob shovel

    bob shovel Well-Known Member

    Joined:
    18th Jun, 2015
    Posts:
    5,377
    Location:
    Somewhere in the land of Oz
    Look into what's happening with the gas. There's a lot more wells and pipes to be built, but not like the last boom, but still should pick up if/when is gets going
    Has the new mine out there been given the go ahead yet (can't think of the name)? Or is it still in the courts??
     
  3. MTR

    MTR Well-Known Member Premium Member

    Joined:
    19th Jun, 2015
    Posts:
    7,370
    Location:
    Perth, Melbourne, USA
    .. as Clint Eastwood said.....ARE YOU FEELING LUCKY PUNK:D
     
    Kate Moloney and Propertunity like this.
  4. Truly Exotic

    Truly Exotic Well-Known Member

    Joined:
    21st Aug, 2015
    Posts:
    225
    Location:
    16.4944° S, 151.7364° W
    that being said,
    trump et al do say "buy in doom, sell in boom"

    food for thought
     
    robboat likes this.
  5. pinkboy

    pinkboy Well-Known Member Premium Member

    Joined:
    18th Jun, 2015
    Posts:
    911
    Location:
    Mackay, Qld
    Charmichael Mine (Adani). Not approved yet. Abbot Point port has the go ahead to expand, but needs this mine to kick off before they start construction.

    We wont have an infrastructure boom like the last one. Most mines are running on high volume, low margin - so still flooding the market with excess coal. The ports in Mackay are running at full capacity at the moment. Id say Bowen and Gladstone would be similar.

    Unless you have deep pockets, and a long term view, Id be more inclined to stay away at the moment until there is some more activity. Unless you can make it work out of the box.


    pinkboy
     
    Kangaroo and bob shovel like this.
  6. MTR

    MTR Well-Known Member Premium Member

    Joined:
    19th Jun, 2015
    Posts:
    7,370
    Location:
    Perth, Melbourne, USA
    Yes, heard this before but have to weigh up risk vs reward, too much risk at the moment, mining bust cycles take longer to recover than resi bust cycles.

    Last thing you want is to be stuck with property where there is oversupply of stock and rentals in mining towns, ouch


    MTR
     
  7. HUGH72

    HUGH72 Well-Known Member

    Joined:
    18th Jun, 2015
    Posts:
    2,122
    Location:
    FNQ
    Are you only taking about 'mining towns'? Or places that have more going for them?
     
  8. robboat

    robboat Well-Known Member

    Joined:
    20th Jun, 2015
    Posts:
    56
    Location:
    Sydney
    Thank you for the above posts. Some good comments and opinions.

    My thoughts are that doom and gloom make for some buying opportunities generally.

    I specifically mentioned mining towns because there have been so many layoffs, a general oversupply of coal at low profit and the future outlook for coal is not too bright.
    Some of these towns have good infrastructure and transport connections so the bones are there if there is a base population to support it.
    This downturn will flow out to the coastal supply towns over time and this is where I believe the real opportunities may happen.

    When? I think sometime in the next few years.....but I could be wrong....;)
    That is why I am looking and open to other opinions.
    Cheers
     
  9. robboat

    robboat Well-Known Member

    Joined:
    20th Jun, 2015
    Posts:
    56
    Location:
    Sydney
    Exactly what I want to avoid.....anywhere!..........:(:(:(
    Cheers,
     
  10. Kate Moloney

    Kate Moloney Well-Known Member

    Joined:
    10th Dec, 2015
    Posts:
    445
    Location:
    Australia
    If you want to end up in a mental institute, go ahead LOL

    More pain likely to come in 2016. Stay away from bowen basin and surat basin. Coastal might be ok, only if its a really, really, really, really, really good deal that you are prepared to wait 5 years to get your money back on. In moranbah they are selling houses and advertising them at 7% gross yield, but by the time you equate the high council rates, insurance and vacancy periods, its not a good return even though its a cheap house.
     
    Bran likes this.