Why Hasn't Brisbane BOOMED

@Whitecat, TBH of all the Logan basher on my list, you and perhaps @melbournian are the fairest of them all. Yes it's a complement You're entitle for your opinion and observation about Logan and concluded it is not doing well and you won't invest there, and I respect this. As for me, who have vested interested in Logan, the suburbs did an average growth, BUT just like ANY other Brisbane suburb in the last 2-3 years.

From Residex suburb profile report, we look at 3 low SES Logan suburbs versus your Wavell Heights.

WAVELL HEIGHTS

• 2016 10%,
• 2015 7%
• 2014 6%
• LAST THREE YEAR INCREASE: 23%

KINGSTON

• 2016 6%
• 2015 8%
• 2014 9%
• LAST THREE YEAR INCREASE: 23%

WOODRIDGE

• 2016 2%
• 2015 9%
• 2014 11%
• LAST THREE YEAR INCREASE: 22%

LOGAN CENTRAL

• 2016 3%
• 2015 11%
• 2014 8%
• LAST THREE YEAR INCREASE: 22%

As you can see from the last 3 year increase perspective, there is very little (a 1%) difference to justify which suburbs is better for growth.

• As per@melbournian post above, there needs deeper discussion and I won't go there as this could be an endless debate.
• One thing to note from people's observation (on the ground or local or potential investor) is the stigma in the place, rough suburb with burnt out cars, high robbery, low income renters, low demographic that will never improve and knows no-one willing to live there, etc, etc
• These observation has been there for the last 1,5, 10, 30 years... It hasn't really improved at all (that's my opinion) and it's unlikely this negativity will change in the time frame I am willing to hold on to the properties.
• BUT, despite this negativity in the suburbs that hasn't improve or no signs of improving, capital growth in the last 15 years has kept up with Brisbane suburbs.
  
• In fact, those mentioned Logan suburbs past growth exceeded growth compared to some of the blue chip Brisbane suburbs..
• There is other discussion that bad tenants are higher versus you may be compensated for higher yield etc, but again we're keep the discussion simple

We should really leave this discussion in the Logan thread.. as I feel Madonna is staring at me.

 

I have not looked specifically at Wagga, but most regional cities/towns have different things going on in different areas.

Like elsewhere, you can't buy the wrong thing or at the wrong time or a combo of both & be surprised when nothing happens, you could do that in Sydney or other capitals too.

Without going into it I saw average CG is 3.5% , so something is going on somewhere.

 

LOL
Hey....I am the gal that purchased about 5 properties in Broadmeadows, Melb one of the worst suburbs in Melb and during GFC 2008, despite many telling me I was nuts at the time, I ended up making a killing....

What some see as dead ducks other will see opportunities. I know nothing about Logan so I am not going to comment. If its working then great.

 

That does not come across as a very scientific or well thought out comparison.

In many regionals I have looked at recently, certain properties have done the same over time as other places. If something has gone up 100%, or 50% , or whatever, it is the same gain no matter where it is located, but because people do not have the same amount of skin in the game, they think they are automatically worse as they only look at the total cash amount.

My point is if a country town has gone up 50% and Sydney has gone up 50% in a similar time frame, if you have the same money invested it is near the same return minus some extra fees due to holding more places in the town due to lower buy in, but that is offset by a better cash flow usually.

Retirerich has just demonstrated the point

 

Brisbane's $3 billion inner-city facelift begins January 1

 

shouldn't this be posted on the hyping thread.?

 

would 30-40% over last 3 years as a boom, or just average ?

I had a quick look at a place that was bought in rising market just before the floods, after flood had pulled back 25%, but 14-16 area done 38% The vendor of this place sold in 15 at a lower value than he bought in 10, the area is a suburb about 20ks out.

My outlook is, that if people bought say 2-3 years ago, in probably many Bris areas they have probably done well, but also have a lot more to come even if it is just 5% a year and it continues on.

The icing on the cake is if you looked around, you could choose places that were close to 5% and even over 5% return.

PS it may get more focus when Syd & Mel are flat and it and GC are only ones rising.

 

Yes this is exactly what I think will happen. Again, mark my words. 2017 - 2018 this will start happening. All very predictable.

 

Kinda like buying in Perth now right????

 

no, opposite in 2008 Melbourne was booming

Perth is falling today, would not touch it today

 

Brisbane boomed. We blinked. It's following the traditional pattern, nothing new.

 

In my humble opinion I would have thought a boom is like 30-40% in a year. In Melbourne certain suburbs it happens within 6-8- months and u see the signs with the bidders. Just like reservoir one property bought on same st 540k 6-7 month later same properties 50meters down sold 795k,800k. Size same house ex housing comm so no way it is different. U can see in the changes within the auctions and bidding and number of people who attend and bid compare to when it was flat. Which is why Logan observations did not impress me to buy.

There are properties in vic like Clayton, Doncaster, Ringwood all within a year can move from 700kish to 1.2 mil. Now that is a real boom.

One property in Doncaster in Melb from 700kish that moved to 1.2 million basically can outdo 3 properties in Pt cook bought for within the same timeline.

If it is 30%in 3 years - 250k ip moves to 275k, then to 302k then to 332k is good but really only 82k which u can achieve quicker with other methods like renovation, sub division permits without building or choose or target a suburb with higher capital growth. But if the limitation is the ability to borrow or buy is only within that price range that is still good

 

Exactly my thoughts ( and experience from buying again 2 years ago) about Brisbane over the last few years. Some surburbs have done exceptionally well already.

 

Not a boom at all, just returning to long term trend.

 

Wow. This is such a great thread with plenty of well informed opinions. Anyway, here is my 2 cents worth...

- in the short to medium term I cannot see Brisbane property prices going up spectacularly as there are simply limited high paying jobs. In my line of work in software engineering and IT recruitment there are so few tech companies it is not funny. Even though a significant portion of recently arrived white collar immigrants want to move to Brisbane the lack of job opportunities is a show stopper despite the lower living costs and laid back lifestyle.
- other factors holding back growth include the lack of well paying jobs in the professional services and financial sectors. Seriously how many well reputed companies have their HQ in Brisbane. Once again the inability to attract white collar workers from overseas and interstate is a big impediment for massive capital growth.

In saying that my next investment property purchase will be in the Logan, Gold Coast and Beenleigh areas as the numbers and potential for a good deal are too good to ignore. If u have a long term outlook then I cannot see much downside risk. It can only go up as u r starting from such a low purchase price and rents covering repayments etc. If u are after a quick buck, I'd steer away from Brisbane

My two cents worth.

 

If you build it, they will come. . . .

 

But I think there is a preference for companies to choose to operate where other similar ones exist though. Like Silicon Valley, all the innovation and smarts are concentrated in the one area, and businesses will specifically move there. Better for cross learning and fund raising.

 

Just making up the loss from the flood period is my take.

 

The world does not revolve around software businesses or engineers alone.

 

Some thought.....

Well, yes, 30% (or 40% eekkk) in a year would be a boom, and one where a big pull back at some stage would not surprise me.

Do not confuse dollars with %. I am sure you know, but others may not.

It looks like the suburb you mention is 50% or so up in this boom.

The Bris % is just a catch up from the flood it seems, 20ks out you can buy for 4-500k, so still cheaper than the Mel suburb from before this cycle, I could be wrong, but seems Bris now has potential & Mel is done.

What I see, in Sydney and Mel is an accelerated bubble driven by cuts in rates, my thoughts are that they may likely give something back, because rates have been too low and credit was too loose while it was that low, Brisbane does not suffer from this problem, and it will not likely do a Syd/Mel style boom and more likely to hold any gains.

Time will tell, but it is pretty hard to ignore when just looking at affordability.