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Hi Mel,
I'm not so far from Townsville, and have been watching the market there for a while now and collecting information and opinion on it. There is no real feeling that Townsville is about to slow down. My problem there is that rents haven't risen in line with property values and you are lucky to find anything that will give you a gross rental ROI of more than about 6%. I thought that the answer lay in corporately let apartments but soon found out that extra costs (higher management etc) soon soak up the higher rent that you get for those properties.
I've been told that there is another battalion going to TSV in about 2011, that Korea Zinc is getting up and running again and that something is going on with the refineries too. Lots happening. There seems to be alot of luxury apartment construction going on, though, with something like 200 apartments under construction now. That made me nervous of oversupply in that particular market, but only because I don't really have the full market picture. The people with the big $ must think it is going to be ok. Interestingly, some of the best capital growth in TSV of late has been in the outlying suburbs eg Thuringowa area etc.I'd buy in TSV if I could afford it, but as I'm using the equity in my own home to secure 100% finance on an investment property, and I can't afford to carry any more repayments myself, I can't afford TSV. Also, because I'm located about 500km away, I can't do the legwork to find that excellent deal that would beat the market.
Good luck. Hope this helps.
SaraWe recently tested the market with our rental at Kingsthorpe, just out of Toowoomba. It is a 3 bed, ordinary home with great sheds on 1/2 acre. Agent said put it on the market for $175K, expecting to sell between $165K and $170K. It was vacant for a while and the property manager had trouble filling it. They said that fewer people were moving to Toowoomba, while the same number of people were leaving. Drought may be an issue, but there is still alot of employment there. The property manager also said something about there being less demand for student accom at the Uni for some reason. apparantly there is alot of vacancy in Toowoomba at the moment. Eventually the property manager found a good tenant for $170pw so we took it off the market again, as we weren't really happy about selling it on the slightly depressed market there.
I can only compare it to Townsville, and I'd say Townsville is ALOT hotter than Toowoomba at the moment. Values still seem to be growing in Townsville, as it continues to have strong economic and population growth. It is proving extremely difficult for me to find something to positive gear in Townsville, or alot of the other centres in North Queensland. Even the outback towns.
If you are looking to buy in Toowoomba, I'd be wary of any potential structure problems caused by the ground shifting due to the drought. Particularly on the blacksoil, this might be a problem.
