Stuck in the Holiday Coast

You didn’t say where you are living?
In regards to investing from afar, the internet is the best way to go. There are many places that are/will be good for cap growth in the near future – you just have to find them.
One thing you can also do is buy reports from Residex on the different stats around the country. I bought one a couple of years ago that gave the 5 year predictions for every suburb on the whole Eastern Seabord for cap growth and rent return. There are several other reports available.
I then picked the ones that were of interest and researched the hell out of each one to find out what was going on in those areas. A lot were duds, but a few were diamonds.
Lots of phone calls to agents and councils etc to get a feel for each area I picked to assess whether the area was viable.
It was a lot of work, but if it was easy then everyone would be doing it.
By the way – don’t discount the Centrelink pedestrians – they are quite often very good tenants as they still have to live somewhere. You might just be able to pick up a couple of good cashflow prospects near you, but you may not get a lot of cap growth. Check out the rent returns and rental demand. You may be able to turn the area to your advantage.

Cheers,
Marc.
[email protected]

In the present climate it will be all but impossible to find both things in one property.
By that I mean you won’t find a ‘valuable’ property with a good rent return.
But what is a ‘valuable’ property? Everyone has a different version of this.
I could show you 100 valuable properties right now on r/e.com.au in the Inner Bayside suburbs of Melb, but you would have trouble affording to buy one and then holding it with the rent returns they offer.

You need to establish your criteria for what you think represents a ‘valuable’ property then start looking for the areas that might have them. After a week or so on the internet you will recognise a potential area very quickly.

For example; I start by looking at the average price of a 3 x 2 house and then look at the average rent return for that type of property in that area. I know within a minute or so whether there is any point continuing to look at the area. It’s a bit like Steve McNight’s 11 second rule (which is unworkable in this r/e climate I believe). It gives me a very quick thumbnail sketch. If the rent return is o.k I will look deeper, etc, etc.

I don’t necessarily buy a 3 x 2 house, but it is a starting point to my system I use for my research.

F.Y.I, my idea of a valuable property is one which is close to all amenities, in an area that has potential for future growth, is below the median house price for that suburb, has good rental demand for that area, is built after 1987, has land content and has a rent return higher than the existing variable rate of interest. As you can guess, this is harder to find right now, but that’s my system.

If it doesn’t have all these criteria I move on.

Cheers,
Marc.
[email protected]

I recently attended the Melbourne Property Investment Expo & their predications for good capital growth areas are South East corner of QLD being Brisbane & the Gold Coast area. There is also a prdication that rental returns will rise quite considerably on the Gold Coast.
Call LJ Hooker Real Estate on 07 5593 8377 & ask for Nicole if there’s anything I can help you with. Miami & Burleigh is a hot pocket at the moment, central Gold Coast, close to the beach.
We currently have a duplex in Burleigh Waters listed for sale at $310,000 & would rent for approx. $300 per week. Currentlry a tenant in place paying $275.00 per week however has been there for a while & is paying low rent. We rent a similar property in the same street for $320 per week however it took 6 weeks to get a tenant prepared to pay that. $300 pw is more realistic.