sceptical about QLD

[Tenex]

It's beyond belief that the Bligh government was able to be so wasteful with all of the benefits of the resources boom and be the 1st state to lose the international AAA credit rating. People hated Newman (me too) but they had nothing to work with. Inheriting the Health payroll debacle that was originally costed at about $18M but will end up costing something like $1.4 Billion for example. How the hell does that happen without affecting infrastructure and frontline services. Which once you're in the hole, combined with resources going down rolls into jobs and company investment not happening.
And don't even get me started on the tunnels that no one uses

Thats right, QLD used to have a really buoyant economy during the resources boom. I wonder why they didnt get the housing boom as much back then.

As is, the unemployment rate is at 6.5%. The government is doing nothing about the fact that cheap labour is pouring into this country from India, Asia and to some degree Europe. Holden and Ford both have closed down in Australia and our big employers such as Telstra are racing against each other to offshore jobs. Liberals are in power after all, why shouldn't they?

Add to that the fact that manufacturing is going to be completely in the tank and the resources prices have followed.

The only reason why housing is doing well at present is low interest rates (and some foreign investment).

Exactly how do we plan to sustain and maintain a property boom in Sydney let alone in QLD?

For example if we buy a property that is 600k, and the unemployment hits double digit, who is going to pay enough rent to keep the vendor above water let alone the property going up in value. I am not saying that a boom wont happen I just dont see the reasons for it as yet.

 

[Angel]

I think there are riskier suburbs in and around Brisbane than some other areas in QLD. People from other states may not be familiar with either though.

Would you tell us which ones you are referring to.

 

[Azazel]

Would you tell us which ones you are referring to.

As stated in previous posts, any suburb with flood history - and there were plenty in Central locations. Remember all the news stories of people who didn't check the fine print in their insurance policies?
For outer suburds, I won't name and shame particular suburbs, part of it would just be my bias. But I would agree with JDP1 below, and this is especially for people who aren't familiar with the areas and are just going on the latest hotspot info in their favourite investment mag:

Not saying one cant make money there...quite possible given the yields and CG potential of the lower entry price. Compared to what however...i.e. opportunity cost given risk.
Plenty of people have also made a good buck or two in non-logan areas without the risk that logan has.

http://somersoft.com/forums/showthread.php?t=105595

 

[see_change]

Not saying one cant make money there...quite possible given the yields and CG potential of the lower entry price. Compared to what however...i.e. opportunity cost given risk.

Plenty of people have also made a good buck or two in non-logan areas without the risk that logan has.

It comes down to whether you think it's a risk . If you don't want to buy there because you think it's a risk , don't .

Cliff

 

[Azazel]

Brisbane auction clearance rate below Canberra, Adelaide AND Tasmania:

 

[vbplease]

In my opinion the reason is - there has been a huge increase in properties going to auction in the past year in Brisbane.. Auctions have never been the norm for selling the 'average' house (unlike Syd/Melb), perhaps exceptional properties, but not entry level, post war, 8kms from CBD. It will take quite a while for buyers to adjust to this..

I'm avoiding auctions as I don't want to compete in a rising market with young couples that are emotionally invested in a property.

 

[Azazel]

In my opinion the reason is - there has been a huge increase in properties going to auction in the past year in Brisbane.. Auctions have never been the norm for selling the 'average' house (unlike Syd/Melb), perhaps exceptional properties, but not entry level, post war, 8kms from CBD. It will take quite a while for buyers to adjust to this..

But if Southern investors who are quite used to auctions are increasing...

 

[hugh72]

But if Southern investors who are quite used to auctions are increasing...

Not sure what your point is as only 71 properties sold by auction in BN in the sample provided. While it my be increasing very few properties are sold by this method in QLD, IMO most of the local market don't purchase bread and butter vanilla properties this way.Happy to be proven wrong but the sample size is way too small to mean anything significant statistically either way

 

[cu@thetop]

In my opinion the reason is - there has been a huge increase in properties going to auction in the past year in Brisbane.. Auctions have never been the norm for selling the 'average' house (unlike Syd/Melb), perhaps exceptional properties, but not entry level, post war, 8kms from CBD. It will take quite a while for buyers to adjust to this..

I'm avoiding auctions as I don't want to compete in a rising market with young couples that are emotionally invested in a property.

I agree with the first part but as regards the second bit someone once said on this forum (was it Skater?) that most of her bargains were purchased at auction and I believe if you are oiled and ready to move I think this is in fact true.

Auctions not really that big here in Qld- it may be because there are no vendor disclosure requirements that buyers are hesitant as they can be sold a non compliant piece of junk with no recourse.

 

[vbplease]

I agree with the first part but as regards the second bit someone once said on this forum (was it Skater?) that most of her bargains were purchased at auction and I believe if you are oiled and ready to move I think this is in fact true.

I'm not holding my breath waiting for a bargain.. I think agents are suggesting an auction will bring top dollar. If the seller isn't happy they pass it in. Pretty low clearance at the moment.. while the ones I'm seeing selling are going pretty high.

I recently made an offer prior to auction which I thought was good. Agent said "the seller will only take an exceptional offer before auction".. "but you should come along to the auction and try your luck anyway. The Seller is committed to sell at auction.. it may go for less than what you offered".

I thought what a ridiculous lie.. there is no way they would sell for less than what I offered, they would rather pass it in. They will probably make their reserve amount the figure I offered.

 

[Azazel]

Not sure what your point is as only 71 properties sold by auction in BN in the sample provided. While it my be increasing very few properties are sold by this method in QLD, IMO most of the local market don't purchase bread and butter vanilla properties this way.Happy to be proven wrong but the sample size is way too small to mean anything significant statistically either way

I don't really have a point, that graphic is black and white and says it all.
There are also less sales in the cities that clearance wise are ahead of Brisbane, so not sure about your point either:
Adelaide 73.8%, 61
Canberra 71.1%, 70
'Tas' 55.6%, 9
Brisbane 52.1%, 71

 

[hugh72]

71 sales in a market with a population of approximately 2.1 million is the point, the sample size is too small to be meaningful that's all

 

[Azazel]

71 sales in a market with a population of approximately 2.1 million is the point, the sample size is too small to be meaningful that's all

What's the population of Adelaide?

 

[hugh72]

Approximately 1 million, as I said the sample size relative to all sales is still too small. We could also discuss the type of properties which generally go to auction in BN.

 

[Azazel]

Approximately 1 million, as I said the sample size relative to all sales is still too small.

Wikipedia has 1.29M population for Adelaide in 2013, so yeah they are both pretty similar in that they both have a lower amount of sales - compared to Sydney and Melbourne.

 

[vbplease]

As mentioned by a few people now, an auction isn't the conventional method of selling in Brisbane, so you can't read too much into the clearance rates. That is, if you were deriving anything from them? since you said..

I don't really have a point

 

[Azazel]

As mentioned by a few people now, an auction isn't the conventional method of selling in Brisbane, so you can't read too much into the clearance rates. That is, if you were deriving anything from them? since you said..

I don't have a point other than what is clearly indicated in the graphic - no need to be rude.
I guess we could come to a similar conclusion for Adelaide (and Canberra and Tas), considering the low numbers (compared to Sydney and Melbourne):

Sydney 84.7%, 843
Melbourne 78.1%, 1,152
Adelaide 73.8%, 61
Canberra 71.1%, 70
'Tas' 55.6%, 9
Brisbane 52.1%, 71

Brisbane does have a 20 percentage points lower clearance rate than both Adelaide and Canberra on that list. As for the reasons? I'll leave that up to someone else.

 

[willair]

Brisbane 52.1%, 71

Brisbane does have a 20 percentage points lower clearance rate than both Adelaide and Canberra on that list. As for the reasons? I'll leave that up to someone else.

The numbers mean nothing,i have watched Brisbane take off about 3 times over investing in Brisbane for the long time,and myself I did not think it would go forward,but from what I'm told from the few real estate sale people I know they cant get enough listings,from the 750k range too 3.5mil
range last time was 10k per month,and that went on for several years...imho..

 

[moyjos]

. Yes Brisbane and Qld is a TERRIBLE place to invest.

You should all never even look north at all. There is nothing to see here

 

[Bran]

The numbers mean nothing,i have watched Brisbane take off about 3 times over investing in Brisbane for the long time,and myself I did not think it would go forward,but from what I'm told from the few real estate sale people I know they cant get enough listings,from the 750k range too 3.5mil
range last time was 10k per month,and that went on for several years...imho..

I agree, and put 3/4 of a mill where my mouth is yesterday on a beautiful house in the inner ring. I'm not after rental yields per se, but it should return 5% and I'm very happy with that.

It's not just the expensive properties, my mother is in real estate Browns Plains way and has zero listings for the first time she can recall.

No one is stressed to sell, perhaps not comfortable enough with employment to sell with the view upgrade, and she tells me Southern investors are snapping up everything (and more so than the Chinese which were in the picture the last 6-12 months).

Go ahead and buy in Brissie, I'm relying on it