QLD Brisbane sub $300K market booming?

I haven't kept too much of an eye on the Brissy market and tend to rely on second hand info and reading material etc, but have heard (through relatives) that the lower end of the housing market is booming at the moment with freestanding homes under $300K in any half decent areas in high demand. They are searching on the southside (Springwood area) and are becoming very frustrated at missing out on stock that's only sitting on the market for mere days before getting snapped up.

Would like to hear from any Brisbanites on their experiences of what's happening up there?

 

I have noticed the same thing in Beenleigh/Eagleby where I hold property - it is zooming up along with rents

Tim

 

ssssshhhhhhhhhhhhh !!!!!!

Dont tell everyone (yet)



Looking at rea.com.au it looks like its moving to me, lots of under offer/contract etc; we picked up a townhouse in Brizzy in Feb 07 using the equity in the Perth IP's with a 5.75% yield on purchase price, rents should increase soon to possibly take that up another 1%

 

I am looking for an IP up to 300K.
Where should I buy in Brisbane or somewhere in Queensland where I can get a steady rent?
I am hoping to get an IP with a good land content (400 sqm +), a reasonable rent and a good future gain prospect. Only have 1 IP in Perth and it's costing me a bit (-ve gearing).

Thanks.

 

Kepperra, Ferny Hills and Grove you could all get a 3 bed house for under 300k 6 months ago - try looking now but im seeing less and less of anything remotely close to brisbane under $300k.

 

Thanks Muzza.
I just checked on realstate.com.au, none of the 3 suburbs has property under 300K. What the rentals like?

 

I dont see any reason any of the suburbs could achieve around 5% return - Ferny Grove is probably a little higher... They are getting an extra train track out there too shortly so I expect it will increase rents slightly. As far as anything under $300k goes - there might be one or two if you keep your eyes peeled - 6 months ago there was plenty!

 

Other areas you could try are places like Deagon, Petrie, Morayfield, Caboolture - although these are all a fair bit further out of the city... Not sure about the returns either.

 

You might find this SS thread of interest

Strong Growth in Brisbane - Somersoft Property Investment Forums

 

Thanks for that, Gad.

Been speaking to other Brissy contacts and they're all saying the same thing- that anything decent under $300K isn't staying on for long at all.
Great time to put your dogboxes on the market, if you're planning to sell and not anticipating much over $300K I'd say, over the next 12-18 mths if the market continues this way.

 

I like that thought Jacque. I see the current strength as a pretty good time to be selling some stock if you have that choice, and have another investment use for the money.

One of my goals is to have a portfolio large enough so that I can keep selling the bottom 10% to improve the quality of the holdings. An idea I got from Peter Spann at at BIG meeting one month.

Difficult to do this when you have less than 10 properties though

 

Look, I don't necessarily advocate selling property, and I've done it myself in the past when I perhaps shouldn't have (hindsight is a wonderful thing!) but I'm referring here to those "troublesome" properties that end up being so stressful that it's just not worth it in the long run to sustain them.

I sold one such house a few years ago at the absolute height of the boom (just lucky timing) and had a contract within days at a price that I was ecstatic with ($50K post tax and costs clear profit) Though I'd only had it for 15mths it had a run of ill-behaved tenants, was in a "bad" area that grew steadily worse, and instinct told me that it was the right thing to do at the time. I've never regretted it as it truly was a "dog" of a property.

You really need to weigh up the costs associated with selling (inc buying, selling and holding expenses) as it can add up quickly to not be a worthwhile exercise. But I don't either hold to the theory to "never sell". Like all things in life, one needs to be flexible and be able to adapt to the situation at hand rather than sticking to a theory because you read it somewhere, or have been brainwashed into believing it's the only way.

 

Brisbane Market

I have heard that Deception Bay is pretty good for investment. It is not a flash area, but they are doing it up. I called some real estate agents and there are some resorts being built and the shopping centre is getting a huge make over.

There are houses on the market for approx 300K with a rent return of $320 p/w, I saw some on the Gumtree website (Brisbane). May be worth a look?

 

I wouldn't touch Brisbane at this point in time - in fact I have sold out.
I think that Ipswich is now overpriced , and will fall some 40 to 50% over the next two years
Perhaps inner city will hold its price?
But think of this for Ipswich- average price there 7 years ago was around 80k - its now 4 times as much. At some point it has to correct - especially when unemployment hits. Also compare that to Wakerley - half the distance to the city and on the Eastern (bay) side - where you can get H & L packages for between 400 and 450k now. I know where I would rather live (having said that, Wakerley has 2 more years of oversupply while they sell off the rest of the land there).

 

we are in caboolture and hold all of our properties here and there are some real bargains here at the moment. You do need to be aware of which areas to avoid, but it is a growing area and nearly everything is returning 5%. There are some slummy areas here but if you have good insurance it isn't a problem. we have some houses in the yucky area but only one house ever had any real problems with tenants and insurance covered the damage ( he took an axe to all the doors).

We have been very happy with our results here. I would personally pick Caboolture/Morayfield over Deception Bay for rentals.

 

Really? I'm not a fan on Ipswich (personal), but 7 years ago (or 4 for that matter) large amounts of the sales volume were relatively small old weatherboard workers cottages. Then the Government changed the planning zones to create the Western corridor in lieu of wall-to-wall suburbia from NSW to Noosa. The bulk of sales shifted to brick venereal houses about twice the size or more than the old ones, most in new estates. The reason the median price has changed so much is because it's a different product.

Sure, it might be propped up by the FHOG now, but it is unlikely to fall much.

Dave