Hi there
I am just taking my first steps in property investing and looking for deals on completion of Steve's 1st and 3rd books. I am hoping to cut my teeth in my local area – this being Charters Towers/Townsville in QLD. I am hoping that Townsville with a population of 160 000 is big enough to have some good deals. Am I right in trying to get to know one area well than skimming over many areas?
From the sample reports on the RP Data website most of the suburbs in Townsville appear to be booming or have been booming. Can anyone with experience in this area comment on this? Are there signs to look for as to whether growth in an area is slowing – I am keen to jump in but should I wait to see if prices are slowing – I don't want to enter the market just before a slowdown or do I?
Has anyone had any experience in this area that they can share?
Kind Regards
MelHi Melsy,
I have been looking at Townsville for about 4 months now and in my view, properties seem to have increased by around a minimum of 10% in that time (for those under $350k). We had trouble with buying as the good deals were gone within hours of listing. I live in Mackay which makes it hard to view properties quickly. I would consider that to be booming. On RP Data you can get a free suburb profile which gives a clear picture of what has happened. As for what will happen in the future, who knows? Townsville has a lot going for it. Since we began looking in Townsville (because Mackay had gone too far too fast) Mackay prices have pulled right back and we are begining to see value here again, especially as rents are much higher here.
Good luck with your property choices. Remember, nothing ventured, nothing gained!
Louise
Hi Melsy
Just wondering how you went with your townsville research etc? We are looking at purchasing our first investment property and have pretty much seen from the API mag that townsville, cairns are the places to buy now… but whereabouts in those areas i ask???? Would love to hear how you went!
Also Lousie (Frangipannitea) hows Mackay going??? Would you advise to buy in that area perhaps??? Would be interested to know good areas around there too, that seem to be booming…
renabelz.
Hi renabelz
I'm sorry I don't have much to share. As Louise and API said Townsville appears to have been booming for some time and the local radio has been saying that they cannot build houses fast enough to meet demand.
I haven't been following the market much just lately. Must remind myself of the saying (I think it may have come from Steve) that goes something like great success takes massive CONSISTENT action.
Good luck with your endeavours
Mel
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.
SaraHi Renabelz,
Mackay prices seem to be firming a little, thoughthey are still off their peak by quite a bit. It is a reasonably good buyers market now with some room to negotiate as things are not moving quickly. I know a few agents and all have more listings they they have had in ages and are finding it hard to sell as people are reluctant to drop prices (up tp 50k on what properties would have sold for 12 – 18 months ago). I have been going to open houses and often I am the only one there. Agents are very 'friendly and accommodating'. They haven't been those things around here for some time. I feel the market offers some good opportunities for those prepared to add value through renovation as tradespeople are very expensive and hard to find here due to the mining boom so most people don't want to buy houses that need a lot of work. Also, rents are very high and seem to be holding – check out rta website. There is virtually a zero vacancy rate. That is the main reason we decided not to go for Townsville – Mackay offers higher rent returns with very little gap between house prices now that Townsville has risen so much.
As far as locations, I am 'emotionally attached' to West Mackay, large blocks, queenslander style homes, very close to the city heart, quiet leafy streets, though I guess it depends on what you are looking for. As the council has not kept up with the level of growth in terms of roads/infrastructure, I tend to look for properties in suburbs within 5 k of the city heart, away from bulk units and housing commission on decent sized blocks (over 800m). People get fed up with sitting in traffic coming in form outer suburbs and petrol prices aren't helping either.
Good luck, and if I can be of any more help let me know.
Louise
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