I have come across a potential IP purchase prior to market release up the northern end of the sunshine coast in QLD. Seller is after $420k and tenant been long term renting for $310/wk. I believe the rent is below market rate. The unit is in a block of 8 and is in close proximity (200m) to the beach access. No water view. What are peoples' thoughts on the future of the Sunshine Coast? If a private sale was possible, how would this effect your offer if the seller did not have to pay commission? I have a long history with this area and I am trying to look at this as objectively as possible. Thanks, TC.
Then I'm surprised you haven't discussed what you think the market value is of the property, and what it's growth prospects are! I'm sure lots of units are within 200m of a beach around there - that doesn't mean they are all good investments. What's special about this one?
Sunshine Coast has a promising future - lots of infrastructure projects and direct flights from overseas commencing in 2020 will see even more tourists flock to the area. I’m not sure about the apartment market - I don’t think they’ve done well historicallly (I might be wrong). One thing to consider is placing it on Airbnb - my wife manages quite a few (apartments and houses) and the returns are pretty awesome and vacancy rates generally low. What part of the Coast? Cheers Jamie
It's in a much smaller town south of Noosa, and due to the layout of the town and geography, there is a smaller stock of units closer to the waterfront. I think the market value is somewhere near the 400k mark and like-for-like apartments are being rented for $340-360/wk. I'm told the current tenant has been there for 15+ years. Ideally I would like long term tenants rather than an Airbnb arrangement but would certainly look into the options surrounding that. With the increase in infrastructure and economy around Caloundra/Mooloolaba/Kawana area is a good thing for the sunny coast, but this area is a good 30k from this activity. I'm just not sure if this is too far from these larger centers. Another attractive aspect of this property is the block of units is situated on a huge flat corner block with terrible use of the space with garages build through the middle. I would purely speculate that perhaps one day in the future this would appeal to a developer.
I'm currently trying to purchase a business in Sunshine Coast therefore also took a glance for the property market there. To my surprise it did really well in the last 5 years and tbh many places did better than Brisbane. Apartments with water view can definitely add a lot of value in Sunshine Coast but if there's no waterview, it depends on what the land value is of that block of building for me to make the decision. But I don't like to gamble on the hope that it may be bought by a developer someday. I prefer either something that I can develop or a cash cow or a promising future of cg.
Is it Sunrise or Sunshine Beach? If so, you are relatively close to Maroochydore to the south and as you said Noosa to the north. What specifically are you concerned about? Both are strong economic hubs within the Sunshine coast.
It's located at Peregian Beach. From looking at the area I think it is worth around 420k and the real estate has appraised it at $350/wk. Not much room for new land due to geographical restrictions (Lake Weyba and National Park) so I'm not sure if limited stock make it more exclusive or restrict future growth and Peregian will be left behind. Trying to compare it to places like Alexandra Headland where 2bedroom apartments are available with ocean view for similar price, albeit in high rise complexes with much more stock to chose from. I agree, I would not want to speculate regarding possible future development but it is an appealing feature of the type and location of this unit, and the size of land it is on.
I would largely ignore the possible development opportunities - these are probably many years away even if in a very desirable location. There are heaps of areas on the Sunshine Coast, and getting 8 owners to agree to sell, let alone agree on pricing, won't be easy. Marg
I agree Marg. But the land value is quite appealing in general. Large 1100m2+ and corner block. Property in question is on the end of the complex with extra side windows opening out onto the shared backyard/green space and pool. We could increase the yield with a light reno (painting and carpets) as the current tenant has been in there for the last 18 years. Perhaps even investigate holiday letting (albeit at an increased headache). At this stage 2 family members hold interests in this townhouse complex so would possibly be 3/8 owners sorted regarding the 'sell' decision. However once again, would probably be at least 7-10 years away (if at all) as sites are absorbed by developers.
I wouldn’t buy a unit with the hope of development. My dad had a unit at surfers paradise in a small block for probably 30years. For at least 20of those 30years it was ‘ripe’ for redevelopment, it was on a large block and there was an available odd shaped block beside it, it was also one block back from the beach and had canal access at the rear. Large high rise were built around it over the years. Some of them were even demolished and redeveloped. Dad sold just before prices crashed around the GFC. He was still sure it would be redeveloped and he could have made more but ended up being happy wth the way it worked out. You know what? That block of units is still there completely unchanged...
Yes, I completely agree. But looking at the facts today, is a 2 bed townhouse at the northern sunshine coast potentially yeilding 4.45% decent? What are other people's experience around the Sunshine coast for the unit/townhouse market? If this was in a 20 storey high rise, with heaps of stock available, I wouldn't have given it a second look. However there are a few factors that seperate it from the 'pack' irrespective of future development speculation.
