hello fellow bloggers and expecially queenslanderians, first of all happy easter…
i was wanting to know what you can tell me about chinchilla in your lovely state of Queensland, is the place worth worrying about or should i not even bother… ive looked into the place and had a friend bring it up but i just wanted to know a little from someone that may actually know the place!!!
any information is appreciated thanks in advance,
benI work not too far from Chinchilla in the Coal Seam Gas mines in the area, stayed in a camp there for a few months, now I stay over in Dalby (about an hour away).
There is no doubt that at the moment Chinchilla would be a good investment and give you positive gearing for any investment you have there. But the mines will not last forever, and when the people finally do leave the area, you will find a significant drop in your property value. In fact with the amount of housing they did build in Chinchilla, I imagine there will be hundreds of vacant houses when the mining companies do eventually finish up and leave the area. The population there simply will not be enough to fill up the houses for a very long time. Supply will be high and demand will be low, ingredients for very low property prices.
Myself personally I am not interested in investing in mining dominated areas, and although Chinchilla isn't a "pure" mining town, it is very significant part of the economy, so once it is taken away, so will the economic viability of the property in the area.
Dalby is slightly bigger (15,000 people compared to 3,000 people in Chinchilla), but again it is mostly dominated with the mining in the area, I would almost rather invest in Toowoomba, which although affected by mining at the moment, is still building in population even without the influence of mining. And it is only about an hour away from Brisbane outer suburbs. Toowoomba would also provide a lot of the maintenance resources required for the mining sites, as you can imagine the maintenance of the mines is going to last a lot longer than the actual construction. This is in regards to coal seam gas anyway.
streamlineinvesting wrote:I work not too far from Chinchilla in the Coal Seam Gas mines in the area, stayed in a camp there for a few months, now I stay over in Dalby (about an hour away).There is no doubt that at the moment Chinchilla would be a good investment and give you positive gearing for any investment you have there. But the mines will not last forever, and when the people finally do leave the area, you will find a significant drop in your property value. In fact with the amount of housing they did build in Chinchilla, I imagine there will be hundreds of vacant houses when the mining companies do eventually finish up and leave the area. The population there simply will not be enough to fill up the houses for a very long time. Supply will be high and demand will be low, ingredients for very low property prices.
Myself personally I am not interested in investing in mining dominated areas, and although Chinchilla isn't a "pure" mining town, it is very significant part of the economy, so once it is taken away, so will the economic viability of the property in the area.
Dalby is slightly bigger (15,000 people compared to 3,000 people in Chinchilla), but again it is mostly dominated with the mining in the area, I would almost rather invest in Toowoomba, which although affected by mining at the moment, is still building in population even without the influence of mining. And it is only about an hour away from Brisbane outer suburbs. Toowoomba would also provide a lot of the maintenance resources required for the mining sites, as you can imagine the maintenance of the mines is going to last a lot longer than the actual construction. This is in regards to coal seam gas anyway.
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I second that ! !
thankyou for your insight is all taken on board.
cheers,
benstreamlineinvesting wrote:Toowoomba would also provide a lot of the maintenance resources required for the mining sites, as you can imagine the maintenance of the mines is going to last a lot longer than the actual construction. This is in regards to coal seam gas anyway.This is an important distinction when looking at regional economies dominated by resources. Qld faces some significant challenges over the next decade or two with both coal and gas. Both are under substantial downwards price pressure which is only set to increase. Coal is being displaced by gas at every opportunity and gas has become abundant over the last decade with some huge finds coupled with CSG and shale gas. Resources won't disappear but a 20% reduction in production makes most ventures borderline at best. So things like royalties and resource expenditure declines significantly.
The other problems with resources is that they have distorted regional economies. So even though other industries exist they haven't changed to any great extent over the last decade. Virtually all change is resource driven either way. This make regional investment in places like Qld difficult to say the least. The most stable places long term will be resource hubs for logistics and maintenance. Newman is an example of this in the WA Pilbara region.
Investors need to be wary of the CSG/shale gas story as well. These are generally small, highly mobile and very temporary (<2yrs) projects.
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