Where to invest?

Houses in Brisbane fit that build at the moment, i.e. yield + rising market + land component with add value potential…..

Stay away from units around the city though as there are too many being built and the market is being driven by intestate and overseas investors..buy where the locals buy…..

RP: Remember, the higher the return, the higher the risk, and risk is volatility.

There are great opportunities on the Sunshine Coast.

Also the Gold Coast…its early but I am seeing great prices on projects including apartments and house and land.
Brisbane in the right area. Bullish on Springfield, Cooparoo,Logan,some inner city apartment areas, Locations in suburbs near train stations.

Toowoomba in the right areas as well

Jerry Parker
Capital Growth Property
http://www.capgrowth.com.au

Sunshine Coast going reasonably well, though at present a dearth of renters, whereas a year ago, you could advertise Wednesday and have the tenant move in Friday the same week. Not sure if its oversupply or the number of people moving to the area has dried up, or they are buying their own houses.

RP & Cattleya,

The population growth of Queensland at about 1.9% is double that of VIC and NSW. From a state population (demand) point of view QLD is a long term stayer. In addition to this, the entry price or affordability relative to VIC and NSW suburbs is far better in QLD. Affordability is increasingly becoming a very important factor in purchase decisions now that all major banks have adjusted their lending policies for investment buyers. That being said, the buying caps or price points in South East Queensland are far more reasonable than major capital cities in VIC, NSW, WA and NT.

In terms of potential suburbs, the real key is to become less emotional about the purchase. We find many of our prospective Clients come to us with ideas of investing in units by the sea on the Sunshine Coast, Gold Coast and other areas where they feel they could retire or live themselves. Without going into the details as to why units are typically poor property investments, the objective of identifying a good location is to find an area with very high current and future population growth, well above the State average. Fast growing regional suburbs (close to major capital cities) is always a great place to start. Some Northern areas of the Gold Coast and Western Areas of Brisbane are growing at an incredible rate of population, driven by their physical locations in relation to capital city employment catchments and close proximity to major, large scale, State-approved infrastructure and retail developments. An example of one of these areas might be Pimpama which is currently growing at a rate of about 9.6% p.a. in population (now officially the fastest growing regional suburb in Australia according to the Qld Treasury and Trade Dept.). There is also an approved 80-Hectare Westfield development which takes up one third of the entire suburb that is now approved to go forward. With 11 schools in the local area and 700 local businesses operating within 7 mins drive it is a massive, massive employment hub. The suburb is also strategically located between to of the largest cities in the Country (Bris / GC). Areas like this, available at prices less than half of Sydney, Melbourne, Perth and Darwin make them extremely compelling investment prospects. Couple this with Commonwealth Games growth (proven to be – as per Melb and Syd games historical price movements – 10% over 2 years post games) it makes it almost impossible to replicate anywhere in Australia.

Moreover, there are other areas west of Brisbane and Gold Coast, some of the larger Lendlease estates that provide huge upside over the next 3-5 years. Some of the land prices in these master planned, community driven, brand new estates have increased by $50,000 over the last quarter alone. Yields for even brand new properties are hovering around the 5% mark which comfortably allow for progressive yield compression without rental increases as the market grows strongly (eg Sydney yields are arguably 3.5%). This provides room for growth.

The data quite frankly doesn’t point anywhere else other than South East Queensland. Affordability and population growth being the main drivers. Even Caboolture is on the up and up after years of zero growth due to oversupply. I read today that occupancy rates in this once hated investment area are now just 1%! The supply issues there are well and truly gone but demand remains. Probably a few bargains to pick up in this area due to it being out of favour for so long.

Hope this helps!

• This reply was modified 9 years, 2 months ago by  Lloyd James Ross.