Okay… so if you had advance knowledge of a town or general area which was about to become subject to a very large mining industry exposure, how would you capitalise on this knowledge?
– Would you look at commercial or residential investments? Or something else?
– If residential, would you aim to buy larger houses with 4 or 5 bedrooms, or 1 and 2 BR units? Do mine employees usually relocate their familties to the location of their employment, or are the small unit investments going to give much higher yields due to individuals moving there by themselves?
– If you purchased property before the mining commenced, when would you sell? Would you sell on the rise, or wait for mining operation to go full swing and sell when prices top out?
– Do a lot of mine employees usually look to purchase property near their employment, or do the majority rent with the aim to move back to a more CBD centred location after a few years?A somewhat hypothetical situation at this point, but might become a reality very quickly.
A lot of people have discussed mining towns on this forum, so I am hoping to gain some general knowledge in an area where I have no expertise.
Any help is much appreciated as always.
Regards,
YI.hi there YI
If the mine is definately happening contracts signed building commenced, then I would be buying, but if a hunch could prove to be a dud. I have noticed with a lot of mining places in WA and QLD there is a lot of fly in fly out or weekly commuting to nearby major cities eg to Rocky or Mackay for example, so I suspect not all mining people move their families out to the mine, but some do.
I think if you can rent direct to the corporate client (ie the mine) you will most likely get a better return whether it be units or houses than going through an agent.
you will never know whether its the top (or bottom for that matter) until well after the event, so you should already have your exit
strategy set before even purchasing, otherwise you are just hoping and waiting like the rest.cheers
HP
Thanks HP.
Have you got any idea about what sort of property the mine itself would be interested in?
Do they tend to purchase houses or units, and would they buy in the township itself, or perhaps say 10-15 mins out of town and a bit closer to the mine?
Thanks,
YI.Hey Yi, I had been looking at Alpha for investment properties which is west of emerald. I was very close to buying a property as the pospective mines in the area were turning up good drilling results. However I walked away from the property and I'm kinda glad I did because the town is so is isolated that the projects would be fly in fly out so the demand for residential properties would be low. That was my theory anyway, I'll be interested to see how it pans out. If your interested google, Alpha in central queensland and Hancock Coal which is the company behind the major exploration in area.
Sometimes they buy the town though, this was the case with Tieri which is now owned and run by Xstrata but that was set up a long time ago and I don't know how prevelant that is anymore. In some cases the mine will set up a camp its self or an accomodation provider like Macs will service a number of the mines in the area, (I stay in one of these camps, not a whole heap of fun).
Regardless though, there will be some demand for executive style accomodation which managers etc. would live in. Anyway I hope this gives you some insight into mining towns
-Fossy
What kind of infrastructure is in the town already eg schooling, health?
Many miners are employed by contractors to the mines who might be on a 2 or 3 year contract. When the contract expires all those miners might be offered positions interstate or nowhere even if the contractor has a contract nearby.
How far is the nearest regional centre? Some miners would prefer to live there and go back from the mine site after their shift roster. If the mining company is going to be offering shifts like 4 on 4 off more miners might live locally, if it's going to be 7 or more on, that's more likely to be fly in.
Blocks of one bedroom flats or a motel might be an option.
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