QLD Would you buy on Hamilton Island ?

So had a quick getaway with the wife and kids over this Christmas break at Hamilton Island and I think it's a really nice place to chill... well chilling as much as you can with 2 toddlers. Definitely a young family friendly destination with an IGA so you can cook whatever meal required for the fussy eaters.

Anyway, so walking around I saw a real estate office and it started to think, is Hamilton island and good place to invest?

Net yield seems ok, but some more DD is required. But the idea of hopping on a plane and flying up there for a long weekend (during a period in which it is vacant) sounds fun and being able to bring family members for help and also cram a few more people in than typically allowed (cos I would own it in that scenario).

Thoughts? Or am I just better renting when I want to go up there?

 

The weather can be an issue as the Whitsunday islands are exposed to cyclones.

As someone about to move to an island myself I would never discourage investing in Paradise.

However as an investment you are tied to the tourism industry and the fate of the Aussie dollar. Plus your neighbours never stick around for long.

 

I would say stick to rent when you are there. Its a very small Island, good for a few days of holiday and relaxation. But to live on it... probably you get bored after about 2 weeks tops. And plus, everything is x2 price in the IGA. You better off ordering online from Coles, and they do deliveries via the ferry.

To invest on that Island, you require at least 450+. Especially now, you can no longer claim the cost of plane ticket travelling to your investment, thats alot of hard earned money tied up. And if there is any sniff of reccession, these places tend to fall the most.

 

The new IGA is well priced but agree that you would get bored quickly. The whole island is leased and you sublease so there is a bit more risk there as well.

 

I think your always better off separating investment decisions from your own lifestyle choices.

Sure, it sounds nice having your own place to go once a year, but wouldn’t it be just as nice to rent someone else’s and keep your options open to move around the island and try other destinations?

As far as investment decisions go, it might be okay...you could probably make the numbers work for you, but if you look for a property with its #1 purpose to make you money, it’s going to work out better.

Is the opportunity cost worth it?

 

I am conservative and wouldn’t buy anything north of Gladstone, due to the risk of cyclones.

Don’t take the above comment as a recommendation to buy in Gladstone .

 

Is south gladstone ok?
That's for the advice I'll buy wherever I'm told to

 

We gauge all of our investing on a spectrum of risk to reward. Hamilton Island doesn't make the cut for us. Too much risk for the possible rewards. Just like mining towns, the risks weren't worth the possible rewards so we stayed away. Tourist-driven markets are too high risk for us.

Also I never mix business decisions with emotional ones. Rarely ends well.

 

Hamilton Island is just another country town surrounded by water. One industry - tourism.

Risks as @kierank points out include cyclones but also AUD fluctuation (effect on OS tourism).

IMHO, buy where you'll get a return (CG or CF) and pay for your holiday of your choice.

 

It's not just cyclones - regular summer storms will cause some degree of water damage every year

 

The airport makes hamilton the pick of the whitsunday islands for passive investment i think but far too speculative for me.

Side note- we had an appt booked there last Apr but it was uninhabitable after cylcone debbie- took them a long while to address all the issues due to power/access problems at the island- didn't get there till last month

 

So how was it?

 

island was back to normal Ted- lotsa people everywhere- free-flowin mai tais