Just bought in a Mining Town

yes I can give my opinion. You will be in much financial pain very soon.
Sorry to bring this bad news, can't make it any better than it is. You got suckered in, you will probably be ruined.
Good luck with repaying your debts the rest of your life.

I have been investing in mining towns for a few years now and some are not only just reliant economically on mining, there are other industries/ income/ projects on the go.

I am project managing 30 new homes being built in Bowen, have approx 50 tenants on my waiting list and approx 30 investors ready to buy when completed, and some major companies coming in for all differing projects, not just mining related.

I think you need to just time when your in and when your out, but some of the most experienced property people in OZ, China, and NZ are heavily involved now in Bowen, Proserpine, Townsville, Mackay and a few other areas- that are responsible for billions of dollars of investment, Im sure their banks and advisors due a lot more due diligence than any of us could hope to do.

Goodluck to anyone out there giving things a go, and not just thinking the gvt is going to look after their retirement, in life you just have to do your best with all your contacts, knowledge, instict, listen to advice from people out there doing it- not just speaking and doing seminars- they have to be doing it live with their own $$$, and if you fail, get up dust yourself off, and go again. Most successful people have failed many times before they have fully succeeded.

You only fail when you give up and dont try, or sit on your computer judging or scaring others to death, the worst thing about our culture I guess is we do not support and encourage people and bring them up and help them, we try to knock them down, scare them, say nasty things- no wonder all of our good brains and talent have taken off to UAE, USA, UK, Germany.

This blog is to help others, advise, share experience, contacts, knowledge, support, not to be critical, nasty, and rude to people.

It is like buying Babcock and Brown or Macquarie Bank at their heights….
The question is : Can the rental price sustain A$ 1300/week for the next 10-15 years?
Sure it is cash flow +ve for now.. but how about in the next 2-3 years…. ???

Dow Jones Future Commodities index took the worse decline in the last 50 years… and Shanghai or Bombay Index also get hammered by 1/2 of their value… lots of talking about booming of BRIC economy…. the truth is they probably will get the worst hits and you can tell the consequence of small to medium mining companies…. remember Poisedon ????

Stu macca,

read some of my other posts, especially the one about RBA having dropped the interest rates by 1% and the real reason to do this ( mortgage resets ). AUD has fallen 30% already over the past few months. It will drop more because of the interest rate drop. This is 30% less profit for mining. Also , commodity prices have crashed about the world. This is 20% less profit for mining. Also , recession is hitting, this is another 50% less profit for mining.
In other words, mining is passe. Get out while you still can. Mining is about to come to a grinding halt, and recession will replace it. Visit http://www.globalhousepricecrash.com – Australian property for all the info you requested.

Scamp,

explain your logic here

"AUD has fallen 30% already over the past few months. It will drop more because of the interest rate drop. This is 30% less profit for mining. "

If the AUD has fallen by 30% and continues to fall then all other things being equal mining revenue received for contracts priced in $US commodity prices would rise by about 30% . A falling AUD is good news for many Australian mining companies. 

Not to mention that half of the posters live overseas, have no clue of anything here other then the BS they chose to read on the net and only seen this country with the aid of Google Earth. They do have plenty of formulas to prove their point , will fake the occasional bad news story if they can't find one and ban anyone even remotely bullish. A bit like some other knowitall in here who seems to be an expert on everything around Australia, from property investing, RBA policies and even politics without even setting foot here yet.
I wonder if the link is just a crude attempt at recruiting more of their kind because they suffered a few casualties recently. Since the rates started coming down last month a few of the local members who could afford it took advantage of the low prices to become FHBs and have become less active in the movement.

S't yeah , hows Bab & Brown eh. I was trading them daily about a year back – can't remember what at and can't be bothered checking but I think it was 25-30ish or where ever they were – could have that off a bit so many since but I did so many good trades on them for awhile there . Hard to believe their where they are now .
Cheers

A reduced demand is still better then NO demand.  That 30% gain will give as a cushion against the fall in demand and even allow us to sell at a lower price and gain a bigger share of the market.

It is a bit of a gamble in that if the mining stopped a $600k house could become $150K overnight and rents would go down to $150/week. If the resources are in the ground even if the mine shut downs temporarily, if you can afford to hold on long enough things would eventually pick up again when the mine reopened . On the other hand the mining could continue for 20 years or more and you'd be laughing all the way to the bank.  A good example is Karratha & Port Hedland, been going strong for decades on the back of resources and it will continue to do so for decades to come.
Since you've already bought it its a bit late to be nervous, just hold on to your hat and enjoy the ride.

Seems to good to be true to me – ,

You know what they say……