Another Brissie thread - but a bit different

Hi all,
I know that there were quite a few "where in Brissie" threads, but my question is a bit different.
I'm currently looking for IP #2 and the target in Brisbane with the budget of 650k. Parameters are:
- Free standing house with a comfortable plot size
- Excellent GC potential
- Rental yield over 4.5% (is that achievable?)
- Under 7km from the CBD
- Low vacancy rate area (<2%)
- Good condition, low maintenance, high depreciation value (nice to have)

Currently looking south of CBD, around Greenslopes/Holland Park area.

However, due to the changes in the lending regime I'm thinking it might be more prudent (pun intended) to go for a lower price range, maybe under 600k.
However, going under 600k (580k+) will take me further out of the cbd to around 8-10 km, maybe something like Upper Mount Gravatt.

I don't think I have a specific question, but more to understand what the community's thoughts are on this.

Is a quality IP in the 650k range a better investment then a quality IP under 600k?
Am I just constraining myself in the 7km vs 10km debate?
Do you feel that there are suburbs in the <600k price range that are better then the my target suburbs (i.e. Greenslopes, Holland Park, Holland Park West)?

Two important facts:
1. I'm Sydney based and have a very minimal knowledge of Brisbane
2. I'm new to the property investment world (although I have a lot of theoretical knowledge, for what it's worth)


Any comments/suggestion/questions are welcome.

Thanks in advance
 
I just bought a renovated 5 bed house in Greenslopes for 700k with a 4.78% yield. I think Greenslopes has been overlooked a little, but will be next in line once Woolloongabba and Buranda is done.

I wasn't quite ready to buy but thought this was a bargain, so went 95% LVR to get it. I'd buy it again tomorrow if I could.

Keep in mind I'm a relative amateur.
 
For a $650k budget you could look at Morningside just, its close to the cbd but not too close. It is surrounded by more expensive suburbs and has a train station close by.
Vacancy rates I'm not sure but it would probably be greater than 2% presently.
Rezoning in Cannon hill has increased demand in this suburb also.
For a slightly lower budget Mt Gravatt/ East/Central and Upper are good options IMO.
 
I just bought a renovated 5 bed house in Greenslopes for 700k with a 4.78% yield. I think Greenslopes has been overlooked a little, but will be next in line once Woolloongabba and Buranda is done.

I wasn't quite ready to buy but thought this was a bargain, so went 95% LVR to get it. I'd buy it again tomorrow if I could.

Keep in mind I'm a relative amateur.

Sounds like a good buy, I also think Greenslopes has a good CG potential.
Was it easy to find a tenant?


For a $650k budget you could look at Morningside just, its close to the cbd but not too close. It is surrounded by more expensive suburbs and has a train station close by.
Vacancy rates I'm not sure but it would probably be greater than 2% presently.
Rezoning in Cannon hill has increased demand in this suburb also.
For a slightly lower budget Mt Gravatt/ East/Central and Upper are good options IMO.

Thanks, will take a look at Morningside. Haven't heard about that suburb before.


Rental yield of 4.5% would be easier to achieve on a slightly cheaper property or for a townhouse etc.

Agree, but yield is not the most important parameter. Free standing, CG and closeness to the cbd are more important then the rental yield (up to a point, I don't want to be haemorrhaging money)
 
Upper Mt Gravatt is good CG hub. A well positioned Satellite cbd, with all the amenities people want be located close by to and/or within easy commute of. We have a few property spread across the southside & bayside including UMG.
 
Upper Mt Gravatt is good CG hub. A well positioned Satellite cbd, with all the amenities people want be located close by to and/or within easy commute of. We have a few property spread across the southside & bayside including UMG.

Thanks Rixter, always value your input.

I know a "how long is a piece of string" kind of question, but how do you an investment in Upper Mt Gravatt compared to Greenslopes? Do you feel the UMG has better potential the GS?
I have almost no knowledge of Brisbane and the area, and it's a bit annoying doing remote desktop research and not being on the ground to get a real vibe of these suburbs.
Might be another hard question, but can UMG be compared to any Sydney suburb? same with Greenslopes?
 
Greenslopes was 1.8% vacancy last time I looked.

It's an interesting area, and currently quite diverse allowing for some value buying.

There is still a fairly large poor constituency, but limits on development with character housing ovelays etc mean many parts of the suburb can and will only be renovated.

Greenslopes Private Hospital has to expand, again. They are in the business of making money, so it's only time before this happens I'm sure.

The IGA Market is a gourmet supermarket heaven, the bottle shop is stocked with craft beers, Jam Pantry is receiving frequent cafe write-ups, the sports fields are always busy with games and families. And so on.

Send me a link if you want my opinion on anything. There is the odd busy rat run street that might not be apparent to an outsider.
 
I have properties in both areas. Mt G has outperformed last two years.

I think it will continue to do so until the Eastern Corridor really starts moving - development of the old Myer site is underway now.

There are quite a few small unit developments coming online in the greater Mt Gravatt area now though, not sure how this measures up to supply. I still like Mount Gravatt East near Logan Rd which is closer to the city, and has more to offer lifestyle wise (IMO) than Holland Park West.

For Greenslopes: It will be interesting to see the demographics at Stones Corner this weekend, they are closing the road off for a food truck festival or similar. This is the sort of thing that culture hungry trendy Brisbanites swallow without chewing, and events like this will continue to draw attention to the (slowly!) changing face of the area.
 
Upper Mt Gravatt is good CG hub. A well positioned Satellite cbd, with all the amenities people want be located close by to and/or within easy commute of. We have a few property spread across the southside & bayside including UMG.

I wouldn't call UMG a satellite CBD, but it's heading that way. I was there a couple of weeks ago and there doesn't seem to be much new office space. There was quite a few new, planned, building high density residential. Will that flood the market and soften rents? Or in time will it make a freestanding house more valuable/desirable? Answer - yes to both IMO.
 
Thanks Rixter, always value your input.

I know a "how long is a piece of string" kind of question, but how do you an investment in Upper Mt Gravatt compared to Greenslopes? Do you feel the UMG has better potential the GS?
I have almost no knowledge of Brisbane and the area, and it's a bit annoying doing remote desktop research and not being on the ground to get a real vibe of these suburbs.
Might be another hard question, but can UMG be compared to any Sydney suburb? same with Greenslopes?

Sorry I cant compare Greenslopes as I've not been there and conducted the relevant DD required at Macro or Micro level.
 
You can buy a splitter site in Morningside and build two new 5 bed dewllings and get around $700/week in rent for each house.

However, each home will cost around $750k each however, the value will be around $800k so you make a small profit along the way.
 
Greenslopes was 1.8% vacancy last time I looked.

It's an interesting area, and currently quite diverse allowing for some value buying.

There is still a fairly large poor constituency, but limits on development with character housing ovelays etc mean many parts of the suburb can and will only be renovated.

Greenslopes Private Hospital has to expand, again. They are in the business of making money, so it's only time before this happens I'm sure.

The IGA Market is a gourmet supermarket heaven, the bottle shop is stocked with craft beers, Jam Pantry is receiving frequent cafe write-ups, the sports fields are always busy with games and families. And so on.

Send me a link if you want my opinion on anything. There is the odd busy rat run street that might not be apparent to an outsider.

I have properties in both areas. Mt G has outperformed last two years.

I think it will continue to do so until the Eastern Corridor really starts moving - development of the old Myer site is underway now.

There are quite a few small unit developments coming online in the greater Mt Gravatt area now though, not sure how this measures up to supply. I still like Mount Gravatt East near Logan Rd which is closer to the city, and has more to offer lifestyle wise (IMO) than Holland Park West.

For Greenslopes: It will be interesting to see the demographics at Stones Corner this weekend, they are closing the road off for a food truck festival or similar. This is the sort of thing that culture hungry trendy Brisbanites swallow without chewing, and events like this will continue to draw attention to the (slowly!) changing face of the area.

Thanks Bran, excellent info to help me out and will definitely take you up on your offer once I have something in my sights.
 
Sorry I cant compare Greenslopes as I've not been there and conducted the relevant DD required at Macro or Micro level.

Fair enough.

Any thoughts on the difference between Mt G., Mt G east and Upper Mt G?
Do you think one is superior to the other?
 
Fair enough.

Any thoughts on the difference between Mt G., Mt G east and Upper Mt G?
Do you think one is superior to the other?

I prefer UMG... its the satellite CBD - main arterial roads north south east & west, public transport hub, high employment, major shopping precinct, good educational medical & recreational facilities.

Govt, Retail, Commercial & Private Sectors injecting money into the area.

I hope this helps.
 
Your strategy

Hi Mancha

I too am relatively new to property investing and it seems I have a different strategy to you. So just wondering your reasoning.

Why are you looking to spend $650k on one property rather than say 2 - 3 properties a bit further out but still close to the CBD?

I imagine there will be arguments from both sides and Im not saying one strategy is wrong but one will obviously do better than the other.

We too are ready to purchase more properties which were going to be atleast our 3rd and 4th but I have often wondered if im better purchasing one that is closer to the CBD.

I dont like:
Having $650k in one suburb (one market) I would rather spread investments over different markets to capture growth in different cycles.
I dont want negatively geared properties. But I know that alot of these newer properties will have fantastic depreciation benefits that could potentially bring the property CF+.

I also think the vacancy rates will be better in the lower end of the market.

Any other pros and cons people????

Nath
 
Because 2-3 houses totalling 650k gives you tenants in the mortgage belt, and those that suffer most in a downturn. And 2-3 times the bills and hassles. Not for me. But cash flow isn't an issue for me either.
 
Fair enough.

Any thoughts on the difference between Mt G., Mt G east and Upper Mt G?
Do you think one is superior to the other?

Very similar IMO, Upper Mt Gravatt is good as its close to Garden city and public transport/buses. Griffith uni is close by and huge numbers of students rent nearby, the area is a employment node. Downside may be the multi story unit blocks which have appeared along Logan rd.
Mt Gravatt central is slightly closer to the city and is undergoing some regeneration, some of it is elevated with city views.
Mt Gravatt East is in the Mansfield SHS catchment which is a drawcard and its close to Westfield Carindale, I could be wrong but its public transport links to the city are not quite as good.
Not much between them IMO, generally older post war houses many renovated, some on large blocks. All these suburbs have pockets of HC houses with many east of Logan rd behind McDonald's, well that used to be the case anyway.
 
Hi all,
I know that there were quite a few "where in Brissie" threads, but my question is a bit different.
I'm currently looking for IP #2 and the target in Brisbane with the budget of 650k. Parameters are:
- Free standing house with a comfortable plot size
- Excellent GC potential
- Rental yield over 4.5% (is that achievable?)
- Under 7km from the CBD
- Low vacancy rate area (<2%)
- Good condition, low maintenance, high depreciation value (nice to have)

Currently looking south of CBD, around Greenslopes/Holland Park area.

However, due to the changes in the lending regime I'm thinking it might be more prudent (pun intended) to go for a lower price range, maybe under 600k.
However, going under 600k (580k+) will take me further out of the cbd to around 8-10 km, maybe something like Upper Mount Gravatt.

I don't think I have a specific question, but more to understand what the community's thoughts are on this.

Is a quality IP in the 650k range a better investment then a quality IP under 600k?
Am I just constraining myself in the 7km vs 10km debate?
Do you feel that there are suburbs in the <600k price range that are better then the my target suburbs (i.e. Greenslopes, Holland Park, Holland Park West)?

Two important facts:
1. I'm Sydney based and have a very minimal knowledge of Brisbane
2. I'm new to the property investment world (although I have a lot of theoretical knowledge, for what it's worth)


Any comments/suggestion/questions are welcome.

Thanks in advance

It seems you do not have a strategy. Both areas are ok, IMHO, but why are you investing? Are you in the accumulation part of the wealth journey, do you wish for a block of land that will have redevelopment or subdivision potential or are you less for land, say townhouses, and you are after the long term CG, or how many IPs are you accumulating in what timeframe to build your $ asset base?

It is very hard to advise not knowing what your end result to be?

If you are accumulating, say growing your asset base, than in general, it is better to accumulate more IPs with lower $ (not the cheapest though???), but if you are after only very strong CG and you wish to have a lower asset base (be more negative geared) but more of premium IPs well then it depends, right?
The better question would be whether you can get a good deal at each of those suburbs, so set a strategy first, then do your due diligence, check out whether you are buying at or below median for the suburb, then you will know if you have the right deal, right?
I read a report recently on Brisbane naming the 10 top blue chips suburbs. I hope that helps:
1. Ascot
2. Fortitude Valley
3. Newstead
4. New Farm
5. Bowen Hills
6. Hamilton
7. Kangaroo Point
8. Bulimba
9. South Brisbane
10. West End
It doesn't really mean anything, if it doesn't match your strategy, right?
Other areas you mentioned are good for other reasons, or like Kelvin Grove for HIPSTER demographic, etc....
SO you see you need to realise why are you investing and how big asset base you wish to grow, and then stick to a strategy how you will get there, so what is yours????
 
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