G’day, have just returned from trip to a regional centre up Qld way.
Still good buys to be had, all of mine are buy and hold…
Here’s the purchases: $56k, rent 130pw tenanted
$105k, rent 180pw, owner in it until settlement, should rent easily, good location.
$84k, rent 145pw, tenanted.
$66k, rent $120pw, tenanted.All houses are structurally good, have plenty of tenant appeal, while there’s little cosmetic things that could be done to dress them up a bit and add a bit of value, while the addition of an air conditioner here and there will all be done in due course, along with other bits and pieces. No major money needs to be spent on any of them.
As a relative newcomer to this game, it was great to get out of Vic, spend a week in the place I was buying and get to know a lot of the agents. Also, I noticed a lot of tenants coming into the agents’ offices looking for places to rent, and would bail them up, asking how much they would expect to pay for different quality homes, location, etc… was very worthwhile just initiating conversations etc.
I already knew that there was a big difference between good agents and bad agents, and it’s not too hard to pick them out. I just went on gut feeling, which is what I trust more than anything. One of the agents is getting into the positive cashflow/positive gearing side of things as his own investment strategy, and we shared a few beers one night and thrashed out different ideas and opinions.
Also, in some of the regional Qld towns, be very wary of houses that have been “renovated” ie a quick paint job and polished floors do not make a good investment when the kitchen and bathroom still need heaps of work. Apparently people from “down south” as we are referred to, are buying these places over the internet, 5-6 at a time without checking them out much, and I might be conservative, but it’s playing with fire to do that. These houses are being sold for 90K and upwards, when they’re probably worth (I reckon) around the 70k mark, if that.
I thought it was common sense to do your homework on different parts of town etc, but clearly, plenty of people aren’t, in their rush to get what is perceievd to be a “bargain”.
The main thing that was reinforced was that you should treat people, agents, tenants etc with respect… because plenty of those “down south” investors don’t appear to be doing so, just going on the many conversations I had while I was there.
I looked at probably 50+ places in varying price brackets before making any offers, because when it came time to do so, I felt I had a decent “feel” of what was worth buying.
Also, while I gave up a week’s work (I’m a freelance journo) it was well worthwhile to actually go to the place in question and look around… I was only going to go for 3 days originally, but really, you need a week if you’re going to do it right.
In terms of property managers, I have 3 different ones at the moment, will see how they go for a few months, then I will consolidate all my houses with one of them, and save 1-1.5% on commissions. It’s not that hard to change managers when the time comes.
Sorry for the long post, just wanted to share my experiences.
Cheers
R(go Tigers, although, AD, I think we’ll fall to you tonight!)
Thats awesome! Well done!
I’m glad you shared this with us all.
I too am a newbie and very much feel the need to inspect the properties and the area before I buy. Maybe one day we’ll be like Steve & Dave and be able to put in offers without necessarily seeing the property itself but safe in the knowledge that we know exactly what a bargain is in that particular area.
Thanks.
LizzieG’day richmond,
I too have bought in QLD and have heard many of the same stories about “The Southerners”
The city that I’ve bought in has had the same internet buying rush. I think that agents actually appreciated me giving them the courtesy of letting them show me through properties, most were up for a good chat and were an invaluable source of info. As you say you can tell the good from the bad pretty easily in person.
I agree fully that you need to look at around 50 properties before you buy I actually looked at 67. It was a mission, but I knew exactly what I was buying and how it compared to everything else around, when I finally did buy.
Good on you for getting right into it too. I only bought 2 properties 4 is excellent, way to go!Cheers
Scott S“Aim for the stars and you’ll shoot the top of the telegraph pole. Aim for the top of the telegraph pole and you’ll shoot yourself in the foot!”
-anonHi Scott,
Reading another post of yours on another thread, I’m pretty sure we have bought in the same place. I am not too worried about the collapse of that plant… I think there is still a lot going for the area in terms of rental demand, while the city has a lot of catching up to do with other regional Qld centres… I just wish I had been there a month or so earlier… Also, with the collapse of the plant, perhaps a few of the “southerners” will offload their properties in a panic and there might be a few good deals around…
Cheers
Ractually, one of the agents told me about some blokes from melbourne who have bought a stack of houses (15 or 20) up there for wrapping… hmmmm…
G’day R
I had that same feeling, I actually wish i was there about 8 months ago, nothing was happening and things that go for 80 – 100K pretty much straight away, were going for 50 – 60K and sitting around on agents books. I’m just glad I got in when I did.
As soon as the two I’m buying now settle I’ll be back up there to buy a couple more! (finance permitting Stu[
]) If you’d like to email me to compare notes at any time I’d be more than happy![8D]Cheers
Scott S“Aim for the stars and you’ll shoot the top of the telegraph pole. Aim for the top of the telegraph pole and you’ll shoot yourself in the foot!”
-anonHi Richmond – a great story and I like your approach.
Recently I did a very similar interstate trip and found my allocated 7 days was only just enough. And that was for only for one property (tenanted with similar price/rents as yours).
A question: When you say you ‘looked’ at places, does that mean that (a) you considered them off the internet, (b) went round and did a kerbside look, or (c) got the agent to show you inside?
If (c) that’s amazing – how did you schedule so many appointments? Or did you ask the agent to ‘show everything’ in the one trip?
I looked at dozens on the web, probably about half-dozen kerbside but only two inside. Before I visited I worked out what street was most desirable/convenient, confirmed this on my visit, so didn’t look much further afield. Then I made my choice, influenced by its good location, general building amenity and quality, reasonable price and existing long-term tenants.
Peter
Hey Peter.
7 days and only a few houses. How come you didn’t see more. Did yo have trouble getting into places with agents or just nothing that worked ?
I am away this week for 6 days on a property trail and I would expect to look at at least 50 properties. Not judging Just wondering.Enjoy
AD [:0)]
(Andrew)“Character cannot be developed in ease and quiet. Only through experience of trial and suffering can the soul be strengthened, ambition inspired, and success achieved.”
Howdy Peter,
Basically, the week before I left I rang as many real estate agents as I could and booked appointments between 8.30am and 7.00pm, so that large chunks of my first 3 days were spent being driven around by agents looking through houses. I would also get other addresses, so that in my down time I could drive around on my own and judge some from the street… I reckon if I looked through 50+ houses, I would have checked out a heap more from just driving past and having a squizz. If you add the ones I looked at on the web, well, it would add up to heaps… Really, when you think about it, 8.30am-7pm equals 10 and a half hours… in a regional city, it doesn’t take much to drive around… averaging 2 houses per hour to look through isn’t doing things in a mad rush, if you know what you’re after before you go in.
At night after I’d had a feed and a frothie (just one!), I’d go driving again, looking in agency windows, seeing what schools and shops etc were where… just adding to my knowledge of the place…
Of the places I bought only one was advertised on the web, and an agent who specialises in some of the cheaper properties in the place I went to is not on the web at all… in fact, he doesn’t even use email… so he gets barely any contact with the dastardly “southerners” which is great as far as I’m concerned… Most of the agencies in the town were struggling to get their listings on the web because they’re getting snapped up so quickly…
Cheers
R
(as I write this AD, the tigers are getting beaten by Brisbane… another disappointing year looms for the yellow and black hordes)
Sorry Richo……The Lions are on fire.
Enjoy
AD [:0)]
(Andrew)“Character cannot be developed in ease and quiet. Only through experience of trial and suffering can the soul be strengthened, ambition inspired, and success achieved.”
Queensland is like another country with the mindset a lot of the locals have – usually more conservative and provincial in their outlook.
I reckon they’re great people even though they refer to us southerners as “Mexicans” because we come from south of the border [
]There’s no doubt that SOME of the people I came across were provincial and conservative, but I think that taking an attitude smudged by broad generalisations and preconceived ideas is only going to hinder investors when they’re trying to deal with people, not just up there, but anywhere.
You might only be joking around AlisonW, but quite a few people told me that they were greatly offended by investors coming in and treating the locals (agents/property managers and tenants alike) as though they were hicks from some backwater town with no idea… At the end of the day we’re all people aren’t we? So why is it so hard for some to be respectful to others? It’s amazing what you get back when you give a bit…
Cheers
RRich: well you are industrious. I agree re properties on the web. Particularly for the smaller towns (<30 000 pop). The bigger town REA seem to list their properties more often, but often they are out of date.
AD: I could have looked in more places, but my criteria was fairly particular, eg within 10 min walk from CBD and uni, built since 1985, brick construction, and low maintenance. Already having tenants was also desirable.
This really narrowed things down as many/most places are fibro and older than 1985. The newer places were more on the fringe of town, where I had decided not to buy.
Within my criteria there were units across the railway line from town. These was on the ‘better’ side of town, so prices were slightly higher.
But I know the area I bought in (the CBD side of the line) was also OK and was far more convenient (nearer uni and no walking over dark railway bridges on the walk into town). Thus I got a prime location and a place that should always be easy to rent.
The main downside of my approach is that I didn’t make multiple offers on various properties and if I had more time might have been able to pick up something for cheaper.
Though I know I did not pay a supercheap price, I know that I paid a fair price by looking up past sales in the area. Another good sign was one RE agent who told me that I approached said ‘you won’t get something in that price range in that area’.
The key question was whether the purchase of my selected property was to my benefit and advanced my investment objectives. With a 9% return and a good location the answer was clearly yes. Thus it wasn’t hard to make the decision.
BTW, I had a relative joining me for some of the time, took the weekend off (where all the agents close for 1.5 days) and spent the last part of my 7 days witnessing the bulding inspection (very educational) and organising pest control, so I clearly worked less hard than Richmond : )
Peter
Is there some secrecy involved here or just protection of the limited abundance theory?
Thanks for sharing your techniques and plans but why is everyone so concerned about others knowing what towns they are researching & buying? From my experience, I have found everyone looks for different qualities & has different tecniques when purchasing. I for one have had huge success when buying properties that others percieve to be problem properties. IE fibro shacks, 2Brm houses, no carports, etc.
For the record – in regional Qld over the past 2 years, I have been buying Hervey Bay, Maryborough & Rockhamptom areas. I have found Hervey Bay is now too hot and Maryborough coming in close behind. However Rockhampton still has some great buys happenning.
Essykay.
g’day essykay, no, I wouldn’t say it’s secrets, but as you know it’s a lot of work to find areas to buy in, researching, phone calls etc, and I reckon I did twice the amount of work without being told where to look than what I might have done if I had… does that make sense? I reckon it’s more worthwhile and a better learning experience for people to seek out their own opportunities without being spoonfed…
take it easy…
r
Hi Guys
If I’ve guessed correctly, could I suggest being careful as to where you purchase in that town. I did a quick trip to the council chambers to look at the new ‘100 year” flood zones. Just thought it may be difficult getting insurance in this area especially on the north side…………
Take care
Dave []ps Do you think the lions will go three in a row this year AD?
Hi guys,
No probs with insurance Dave,both my places were insured no worries as soon as I signed the contracts. I actually checked out insurance on a place that I know does get wet, and they would still insure it (although at a slightly higher rate).
It’s not so much secrecy Essykay, but I found that half the learning was in finding the places that I thought had good growth potential, while giving positive casflow. As you say R it’s a more wortwhile experience when you do it yourself, rather than being spoonfed.
I made some really good friends amongst the agents up there, and I think it was all to do with the way that I treated them, I didn’t find any hicks amongst them.Cheers,
Scott S“Aim for the stars and you’ll shoot the top of the telegraph pole. Aim for the top of the telegraph pole and you’ll shoot yourself in the foot!”
-anonGood ol Rockhampton eh? [
]Richmond / Scott,
Granted & very true!
Cheers
Essykayhi i just got back from rocky and the agents are saying that the southers are buying heaps of houses from 90’000 downwards as soon as there put up for sale there being sold they all talk about the buyers who come up and do a drive by and buy 10 at a time with out lookin in side them so the prices are riseing. not from the locals buying but the investor from down south.
]) If you’d like to email me to compare notes at any time I’d be more than happy![8D]
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