With the required underlaying fundamentals in place, that's the ideal time (from investment viewpoint) to be purchasing..
Doing the opposite to the masses that drive the prices.
Another where to buy. Brisbane vs. Sydney
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With the required underlaying fundamentals in place, that's the ideal time (from investment viewpoint) to be purchasing..
Doing the opposite to the masses that drive the prices.
I think I've been hearing the Brisbane story practically from the day I first set foot in Oz in 2010. Never really understood why Brisbane is set to fly. It's a nice city, buy it is still developing and I am not sure it has the steam to go off as Sydney did and will.
I really hope it will as it is a great city, but still most people I know moved there only because of affordability while there first choice would be Sydney/Melbourne.
Maybe 2015 will be Brisbane's year? I do hope so for all the SS investors.
I a macro sense, I believe more in the Sydney story and that while our of cycle it can achieve a standard increase in price, in the cycle it goes bunkers.
But what is Sydney? can you really put the far west, inner west, inner city, south, north shore, eastern suburbs, northern beaches, etc. in one bucket?
I have nothing to back what I am saying, but I don't think that the Parramatta area behaves the same as the eastern suburbs and they both behave differently then the northern shore.
Is this referring to Sydney or Brisbane? I assume Sydney as every man and his dog is investing in Brisbane. Not really going opposite to the masses.
You're right, Rixter. The 100k passive income is a very aggressive target regardless if it's gross or net.
I think at this stage there are too many unknowns to me to paint a long term goal, so I am more concentrating on how to achieve my short term goal of getting a balanced portfolio of 5 properties in the next 6 years.
For that I need to define what is a balanced portfolio and what is the purpose of these 5 properties which will define CF vs. CG ratio.
Referring to Brisbane.. The masses are not investors. Investors are the minority. The investors get in ahead of the herd or masses which are the owner occupiers. The owner occupiers are the emotionally fueled purchasers. They purchase with their hearts, where as investors purchase with their heads.
I remember a mentor advising me years ago, if you dont know where you are going all roads will appear to take you there.
Maybe some food for thought.
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Rixter, do you have a template as to how you craft out the goals?
For our financial goals I use a fantastic program/software/ebook written by our accountant prior to him exiting the rat race, Dale Gatherum-Goss & his son James.
The program is called Wealth Sabotage and IMO a must have tool to help you with setting financial goals and monitoring your progress along the way.
I hope this helps.
Thanks Tonibell, sounds like an interesting approach you've taken.
I'm currently a bit time poor (full time job, 3 kids and 2 dogs....) so will be using a BA. Problem is that I still need and want to understand the fine details and will question anything the BA will tell me.
I see your point. I think I'd like a mixture of units in quality areas (i.e. Sydney city/beaches) with more land as I venture to more speculative areas.
This is what brought me to think of starting off with a house with good CF in Brisbane and a unit with good CG in Sydney. My assumption here is that for the long run (7+ years) Sydney properties have a higher chance of appreciating then other places in Australia. But we all know what they say about assumptions
Maybe I should change my approach and go for 2 good CF properties (probably Brissie) as a first step and when able bring in a 3rd for CG?
The more I think about it, I think that for a first IP maybe Brissie is the way to go.
I believe in Sydney and think in the medium to long term it's an very good investment, but it is a bit more complicated at the moment.
Can you elaborate on what you mean by a good plan?
Time is always a challenge - we just reckon (probably mistakedly) that we will find a better deal for us overall than a Buyers Agent could.
Our kids are now pleading "please no more Gold Coast theme park holidays", so maybe we have overdone it.
Our approach has been to manufacture a bit of CF and CG ourselves with each of the properties - it is generally difficult to purchase something with good CF in a good area without getting your hands dirty.
That is what I mean by a plan for Sydney - I don't think you can just expect the market to give you CG like it has in the last couple of years. It is hard to get a bargain if you are buying the "finished product".
What makes things worse is you'd need $165k income in 15 years time in TODAYS dollars. Assuming inflation 3% this equals about $250k... at 4% yield the portfolio would need to be worth $6.5m (in future dollars).
If you had an equity of $1m today this equity would need to grow at 13% compounded per annum to be worth $6.5m in 15 years. This is a massive task and may be hard to achieve from passive buy-and-hold investment.
You may wish to consider value-adding strategies like subdivisions and development to assist. Whilst your focus may be on BNE and SYD there are some excellent opportunities for this in Adelaide, where you can buy a property suitable for 1 into 3 development within 10km from CBD, near the beach and for high $400s. This may be the "Doing the opposite to the masses that drive the prices" thing as stated by Rixter. Just a thought.
That's why a lot of the long term forum members aren't buying in Sydney . Our last Sydney buy was just as the market started moving in our local area in August 2013 . Last investments were a year or so before that .
Last investment buys were in Brisbane .
Looking to buy some more in next months and we will look at a few areas in brissie and else where .
Cliff
We are following you Cliff !
Don't have a Twitter feed do you ?
No .... Sorry ......
Cliff
Maybe Brisbane is just slow as the average Joe doesn't know what's going on until it's in the news,. Anyone here want to manipulate some blogs and get the boom going
Do you use the trust magic book Rixter? Or just the software
Maybe Brisbane is just slow as the average Joe doesn't know what's going on until it's in the news,. Anyone here want to manipulate some blogs and get the boom going
You mean see_change and moneyman 85 hype the Brissie market???
Plllease
Yea why not, spread some rumours, tell some lies lol
Read the original trust magic when it came out in 2003 and also the updated versions in 2011..
Read Wealth Sabotage when it came out in 2006 and have been religiously using its software for the past 9 years.
I flip flop on Brisbane almost daily. Unemployment is rising, same in Canberra. Auction clearance rates in Brisbane are lower than Adelaide. The last Labor government created the massive budget hole that they're in, how is the new Labor govt going to fix it without selling off assets? Don't get me wrong, Newman was a clown too.
I see lots of overpriced property in Brisbane, but it seems to be sellling. Maybe because it just looks affordable compared to Sydney?
I think there's better value in other places.
I don't think Brisbane needs hyping right now. If your strategy is capital cities though, and despite some of the challenges Brisbane face right now (mentioned a couple of posts back in this thread); it is hard to see any cap city that is offering much better prospects for investors right now. Just in my humble opinion (and totally happy to be proven wrong as I am not armed with all the macroeconomic facts, per-city), but here's how I'd rate 8 x cap cities right now, on my personal real estate clock (12pm being peak, 6pm trough, 3pm cooling, 9pm rising).
I've also listed my own wildcard factor next to each. The wildcard might be an anecdote that is a caution or opportunity, regardless of the city's spot on the clock.
Again, I'm not armed with all the facts so I'm totally happy to be told I'm wrong! Still a learning/developing investor here!
Sydney - 12 o clock. Way too hot to touch. I'm avoiding it and many others as Cliff mentioned, are too. Like a Bondi spinster in her 50's with too much botox just done; she looks enticing from a distance but you get closer and the shine isn't so appealing..
Melbourne - 1.30. I think we've seen the peak but investors still avoiding as stock comes piling on to the market. This sassy girl wore the best dress of the night to the big parry and everyone has noticed in a good way. Problem is; the dress seemed like a uniqur designer Prada number, but turned out to be an off-the-rack generic Zara dress that many other girls turned up that night also wearing. And, the tag is still sticking out the dress.
Brisbane (and boldly.. The SEQ metro triangle including CG and SC..) - I'd argue around 7.30 which would present as an opportunity for many. But maybe its already around 9 or 10? Brizzi is the nice girl in the back of the classroom who gets good grades and doesn't really get into trouble. Once she left a biro pen in her uniform and it went through the wash, putting ink everywhere. People in class laughed for a couple of days but got over it. All the while she hasn't really paid attention to them and kept her mind on her studies.
Perth - 3 o clock. Most investors would say 'don't touch it!' But to others they say 'well.. One persons trash is another's treasure. Perth is a great singer and has a great voice. Instead of trying to get gigs and build a name for herself in the music industry, she went on one of those many reality TV singing contest shows. Sure, the crowds loved her and she won the damned season finale, but like all those song contest winners, when it came time for her to put out a solo album of her own songs, they all lacked any substance and she became yesterdays news, very quickly.
Adelaide - 7 o clock. Plenty of opportunity on the surface but are the macroeconomic drivers really there? After the auto loss And Olympic dam fallout, does Adelaide have a money-maker it can shake in people's faces? Not tempted. Adelaide is full of charisma, charm, and wit but she can still stand you up on a first, second or 17th date.
Canberra - 4 or 5 o clock. I personally have no experience in this market and whilst I don't discount investing there one day, for now I just don't see the appeal of a market so volatile on account of this increasingly frequent unstable governments. Canberra is a true politician; she's tough, hard to like; deceptive, and you mostly only pay attention to her for the things she doesn't do, versus the things she does do.
Hobart - 7 or 8 maybe? Apart from holidaying herr recently and learning the market; i dont have investing experence. The economy is still in a rough spot but their emerging tourism, foodie, and Baby Boomer retirement housing industry could pick things up again. Hobart is your friends lovely old grandmother who has been baking scones forever. Suddenly scones are 'on-trend' due to moronic hipsters bringing them back and Women's Weekly doing a 6-page special on them this month; making scones a trend again. But who knows how long Granny's prized scones will be coveted for until they fade back into the background again?
Darwin - 12 or 1? Already hot for ages, this market is likely at the peak and investors aren't touching it. Darwin is that obnoxious girl you met in a tour group on a European holiday. She's out of place, loud, and is clearly only there thanks to daddy's very large chequebook.
I've also listed my own wildcard factor next to each. The wildcard might be an anecdote that is a caution or opportunity, regardless of the city's spot on the clock.
Again, I'm not armed with all the facts so I'm totally happy to be told I'm wrong! Still a learning/developing investor here!
Sydney - 12 o clock. Way too hot to touch. I'm avoiding it and many others as Cliff mentioned, are too. Like a Bondi spinster in her 50's with too much botox just done; she looks enticing from a distance but you get closer and the shine isn't so appealing..
Melbourne - 1.30. I think we've seen the peak but investors still avoiding as stock comes piling on to the market. This sassy girl wore the best dress of the night to the big parry and everyone has noticed in a good way. Problem is; the dress seemed like a uniqur designer Prada number, but turned out to be an off-the-rack generic Zara dress that many other girls turned up that night also wearing. And, the tag is still sticking out the dress.
Brisbane (and boldly.. The SEQ metro triangle including CG and SC..) - I'd argue around 7.30 which would present as an opportunity for many. But maybe its already around 9 or 10? Brizzi is the nice girl in the back of the classroom who gets good grades and doesn't really get into trouble. Once she left a biro pen in her uniform and it went through the wash, putting ink everywhere. People in class laughed for a couple of days but got over it. All the while she hasn't really paid attention to them and kept her mind on her studies.
Perth - 3 o clock. Most investors would say 'don't touch it!' But to others they say 'well.. One persons trash is another's treasure. Perth is a great singer and has a great voice. Instead of trying to get gigs and build a name for herself in the music industry, she went on one of those many reality TV singing contest shows. Sure, the crowds loved her and she won the damned season finale, but like all those song contest winners, when it came time for her to put out a solo album of her own songs, they all lacked any substance and she became yesterdays news, very quickly.
Adelaide - 7 o clock. Plenty of opportunity on the surface but are the macroeconomic drivers really there? After the auto loss And Olympic dam fallout, does Adelaide have a money-maker it can shake in people's faces? Not tempted. Adelaide is full of charisma, charm, and wit but she can still stand you up on a first, second or 17th date.
Canberra - 4 or 5 o clock. I personally have no experience in this market and whilst I don't discount investing there one day, for now I just don't see the appeal of a market so volatile on account of this increasingly frequent unstable governments. Canberra is a true politician; she's tough, hard to like; deceptive, and you mostly only pay attention to her for the things she doesn't do, versus the things she does do.
Hobart - 7 or 8 maybe? Apart from holidaying herr recently and learning the market; i dont have investing experence. The economy is still in a rough spot but their emerging tourism, foodie, and Baby Boomer retirement housing industry could pick things up again. Hobart is your friends lovely old grandmother who has been baking scones forever. Suddenly scones are 'on-trend' due to moronic hipsters bringing them back and Women's Weekly doing a 6-page special on them this month; making scones a trend again. But who knows how long Granny's prized scones will be coveted for until they fade back into the background again?
Darwin - 12 or 1? Already hot for ages, this market is likely at the peak and investors aren't touching it. Darwin is that obnoxious girl you met in a tour group on a European holiday. She's out of place, loud, and is clearly only there thanks to daddy's very large chequebook.
I would have thought Brisbane was the thong wearing neighbour of Sydney, pays his taxes , drives the kids to sport on the weekend then relax with a xxxx on Sundays. Sitting at 6 o,clock maybe?
