QLD Should we give up on Brisbane?

I think I might have accidentally set off the mount cotton discussion! Acreage in any area of the south east is gold.

 

Mount Cotton , Never heard of it until now .

Is it Fine Cotton ??

Cliff

 

Umm. Thinking you aren’t far off.
Ouch. It’s badder than bad.

 

Or. Comparing Brisbane to Sydney/Melb it appears not too bad at all right now. Sure there’s some discounts but it hasn’t dropped off a cliff.

 

Agree, I’ll share some random thoughts from my experience.

We work with approx 10-12 buyers a month and finding those buyers hasn’t slowed down at all. Leads are as high as ever. The only thing we are finding challenging is finding good stock to buy for them.

From my experience and speaking to agents in the areas we buy, listings have dropped 50-70%. For example, one agency usually has 140 listing and currently only has 40 of which majority are retirement homes.

I’ve spoken to 20-30 agents over the last month and almost all of them have said they have a decent number of sellers in the pipeline, who are all waiting for ‘things to get better’ before they go to market. Lack of stock is what’s holding up the market in my opinion.

For the type of properties we like to buy (600sqm+ blocks, not on main roads etc), on market stock has barely taken a hit, 0-5% say. We are buying some pre market properties closer to a 5% discount. Most areas seem to just have lost the gains we has earlier in the year. We’re sitting back where we were late last year.

My concern is what’s going to happen when all this stock comes to market and when loan deferrals / job keeper etc all come to an end around September.

But that’s out of my control, all I can control is managing my own portfolio. I’ve been lucky that all of my tenants are all still paying the same rent.

The portfolio I have now is a long term play, always has been. My plan is to manage through this time and perhaps pick up one more later in the year.

I’m a big believer in Fred Harrison’s / Phill Anderson’s 18.6 year cycle and believe Brisbane is in for a great run through the second part of the cycle (2021-2025).

But hey, really I’m 25 and have no idea what’s going to happen. I’m grateful for this opportunity as it’s the first downturn I’ve experienced. It’s a great time to learn and it’s so interesting to see human psychology at play.

 

I agree- general thoughts at the moment is that stimulus is holding the market up right now, but delayed affects of the economic conditions will cause a drop. That's how it should be anyway, avoid the sudden loss of confidence that causes a collapse and let the market 'correct' naturally.

I'm just glad to be in an area like Logan where everything is already affordable and quite stable. I don't envy Real Estate Agents and property owners who are in higher risk areas (e.g. overvalued, expensive).

 

Great post thanks for sharing @Hayden94

I agree with your thoughts around September, here’s hoping the news of the govt overestimating the cost of job keeper by around $60B means they will extend it for the rest of the year

 

It hasn’t dropped off the cliff because It never climbed the mountain to start with

 

hi! Thanks for this. I was wondering if there had been a slip in the last week or two. We only have one investment, keen to buy this downturn!

 

There’s two type of vendors at the moment, those that are desperate and those that are not under pressure and waiting for the greater fool.

Brisbane prices are stuck at Jan 2020 , there’s a massive slip in listings and recency bias is at an all time high. Some listing are actually increasing their asking prices. Come September it will be a blood bath when the false economy is wiped.

 

hope the blood bath is good. Been waiting to get into Clayfield house for a while.

 

This is a false hope in Brisbane. Good assets in blue chip areas always creeps up, you can only get in early enough. The highs and lows are felt by assets that you don’t want anyway. If it fell for them it can fall for you no?

 

did that happen in 1991 the last time a recession was here ?

Blue chip property has fallen in every market I have been in that’s had a recession , not sure why you think Brisbane would be the exception

 

Care to reevaluate 13 months on ? ‘Overvalued’ areas ended up doing ok

 

So funny reading all the comments about a blood bath coming etc above, maybe they meant a bloodbath for first home buyers trying to enter the market

 

It's a bit surreal reading these comments of doom.. however, to be fair, they were very uncertain (for many unprecedented) times.. many small businesses were going under, renters didn't need to pay rent if under hardship, repayment holidays for home loans, and withdrawing super.. not many people have lived through that before.

 

Yeah I get that but it’s funny people making bold statements with conviction about what they knew was going to happen next . They should have been like me and just said they had no idea what would happen next . Anyway it makes for very entertaining reading

 

By the way I still haven't bought a free standing house as IP in Clayfield.
Couldn't crack open the piggy bank door. They have stopped me from doing it. Settle for Stafford instead.