Hi All,
I have finally found a property which I am considering purchasing as my first IP. It is a house and land (sold separately) in Gleneagle. Land(2000sqm) is for 119k and I should be able to build a decent house on it for under 150k.
We visited some real estate agents in the area over the weekend and there are not many properties there for rent and the weekly rent ranges from 280-300 week. This suburb is close to Jimboomba and Beaudesert. It is probably an hour from Brisbane CBD and maybe 40-50mins from Gold Coast. Might be a risk as it would probably take longer to find a tenant then if I invested closer to Brisbane.
But other then that is there anything else that I should look out for or research? Or is there anyone else who has invested in this area previously who has any advice?
Thanks
has this property mains water or does it depend on rain water or a bore? Both can be very expensive.
puggsy
Hi Puggsy,
It is in a new estate with fully serviced half acerages. It does have town water, phone lines and electricity underground. However the town water uses a trickle feed system meaning an underground holding tank does need to be within the property.
Hi SK2,
You must be looking for future cap growth, because $280-$300pw yields will not come close to paying for your $350,000 investment.
Therefore, lets look at your chances.
From experience new sub-divisions take at least 3-5 years to see any form of cap growth (Especially in the current Brizzy market). This is because the land developers either sell in stages (still an existing supply of vacant land) or they simply cannot sell all the blocks ( 99% of people would rather build their own master piece then buy your choice of home). This coupled with the fact that all of your neighbours are all building new houses too means you will not have much chance of pulling anymore for your house than they will, which in the current market is usally cost (because most people do their DD, and can see what the blocks are selling for in the estate and know what the home has cost to build) your only hope is adding perceived value.
My advice…stick to existing properties in areas that are in demand( or future for-seeable demand), find the niche (or peoples need), what people are buying/renting and why and then fill this need. This way you can differentiate your property from the older ones by adding perceived value thus making a tidy profit, both yield and cap growth (possibly).
Good Luck [biggrin]
Higly Motivated Investor
Thanks for the advice Krupta. You are right the developer will be selling other stages in the same area.
The total investment however will be under $280k and not 350k as you mentioned.
Regards,
SK2
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