QLD What is your thoughts on Blackwater in QLD

Hi all

I was reading one of the article in the news recently it says rental yields highest in the country is in a suburb called Black water in QLD

A quick search here and on google indicates it’s mining town. Is that means it’s a risk for investors to buy in that area ?

Has any one bought over there?

My all properties based in VIC only and I have not much clue about mining towns keen to hear your thoughts. Much appreciated.

 

Population less than 5,000

I wouldn’t touch it unless I had some mullah to burn

 

Biggest crap hole of a town next to Collinsville!
All it has going for it is a mining town with a large chunk of the homes being owned by the mining companies meaning the houses are not looked after. It has a bakery and a Woolworth that hasn’t been up dated since the early 90s
Money can be made but with coal mining it’s 5 to 7 years of boom then bust to the point it looks like a toast town. It’s well past it’s hey say due to many of the mining companies prefer to keep their workers in camps due to lower costs and to help keep the unions out

 

Any purchase in a mining-dependent town is a gamble. Some win big, some lose big.

At the moment, mining towns in Qld are pretty much bumping along on the bottom. You can’t count on any, or much, capital gain. Then again, if the mines awaiting approval actually go ahead, the demand may soar. Who knows?

It’s a big risk.

 

You mean Back water?

 

More like Black hole. Once your money goes in... never comes out!

 

Thank you everyone for feedback/comments.

 

It's really a speculative play for those whose portfolios can support the risks. Also your not investing in the property market as much as you are in the underlying comodity of the area.

 

lol...Black Water....

Something I am often in

 

Having been to Blackwater i can confirm that its not the most appealing of places.
Some mining towns can have appealing features just depends on the towns history really

i think the town hit rock bottom around 3 years ago (houses selling for 25-40k) and then had a mini boom which was most likely fuelled by investors. Thus has caused prices to rise a little but has put downwards pressure on rent

So currently you could purchase a basic house for around 80k but you would only get $175 a week which realistically would only leave you with around 3k after expenses (based on cash purchase) - so not worth it

Having missed the initial rock bottom its probably just a place to monitor as you will find that the vacancies should eventually come down and rents should rise and be starting around the $250 mark
which would leave you with aroind 7k in your pocket or 8.75% cash return
i wouldnt expect prices to rise in the short.term as it doesnt really have that owner occupier appeal that other towns do

having said all that its probably a place i would avoid as you could get the same deal in a better town anyway

 

Best places to invest in property

Personally, I am risk averse to mining dependant towns ...

 

Thank you everyone for your inputs. Really appreciate your thoughts.

 

Townsville is better, look at North Ward/Belgian Gardens/Castle Hill. There are connecting flights from Townsville Airport to Blackwater/Moranbah etc. Plus who wants to live in a hot desert? at least in Townsville the beachside suburbs get a lovely seabreeze and have great cafes and bars.

 

Make sure you factor in things like:
1. If something goes wrong how much does it cost to fix? Do you know a good builder / tiler / waterproofer etc there? If not get ready to pay exorbitant fees. Where there's no competition for services there's going to be extra to pay. I can't see tradies there being happy to do cheap jobs for out of towners. Locals may think you're trying to ruin their town and charge accordingly.
2. If it doesn't go up and you get stuck with it what will you do? Move there? There's plenty of high yield small towns that are much nicer.
3. What if the town doesn't exist or is a shell of itself in 20 years? Unlikely but who knows? Musket Flat was once a pretty major centre with lots going on. Small towns sometimes die. Take away coal from the region and what happens?

I've had lots of family buy in towns like this and it's never worked out well. You may be the lucky one though....

 

Speaking from experience from someone who owns a property there - avoid it like the plague. Rents have bounced back a bit now, but the clincher is you’re paying between quarter to double the costs to maintain an IP than in a metro or larger regional area.

Property mgt fees 9.5%, hefty maintenance costs and tenants from hell.

 

Thanks for taking time to reply

 

This is a pretty response at that time. What do you think about Blackwater todays? @strongy1986

 

If I was looking for cashflow I would buy there but it would have to be 4 2 2 with already quality tenants and low maintenance plenty of projects going on I wouldn't buy the older 3x1 commission houses they have been there for a long time. The extremely cheap houses are leasehold buy freehold only leasehold require a huge deposit I believe.exit would be 5 years.

 

Hi Samj

Did you managed to buy there at that time or was thinking same like me back then dropped off the plans for various reasons ?