Are Brisbane yields the same as Sydney now?

[danwatto]

What yields should we be expecting on older units along the north/south train lines < 10km to the CBD in Brisbane?

So far I'm not seeing much better in Brisbane than Sydney, and agents are telling me 5% is the norm now.

Knowing the Sydney market I can find much better than 5% here, but with the market being a bit heated I was hoping to look in Brisbane (and to avoid more land tax )

Am I just not looking hard enough? Or is it just too late for Brisbane and I've well and truly missed out, and should be looking in other states?

 

[saiman]

Where in Sydney can you find 5% yields in the same vicinity as Brisbane suburbs to the CBD?

5% yields in Sydney = Western Sydney which is = to Brisbane's Logan area where 6 - 7% can still be achieved.

 

[Redom]

Agree. I bought in Brisbane last year around 12km out from CBD with a 6.2% yield. I got similar stock 55km's from Sydney CBD at similar yield.

Big difference in location/proximity to CBD.

Where in Sydney can you find 5% yields in the same vicinity as Brisbane suburbs to the CBD?

5% yields in Sydney = Western Sydney which is = to Brisbane's Logan area where 6 - 7% can still be achieved.

 

[Neptune]

What yields should we be expecting on older units along the north/south train lines < 10km to the CBD in Brisbane?

I bought an older style low rise unit a few months ago in Brisbane, just under 3k from CBD and am getting a yield of 5.3%.
Got it rented very quickly but have since seen another unit in the same block that sold around the same time taking much longer to get rented and they had to drop their rent quite a bit to give them a yield of about 4.9%.

Have noticed the vacancy rate is creeping up in some inner city suburbs so this may impact yields a little.

 

[danwatto]

Where in Sydney can you find 5% yields in the same vicinity as Brisbane suburbs to the CBD?

5% yields in Sydney = Western Sydney which is = to Brisbane's Logan area where 6 - 7% can still be achieved.

Lots of examples.

One is Erskineville. 1 Bedrooms rent for $500-$600pw, prices are around $500k
At $550pw that is about 5.5% gross

Buy:
http://www.realestate.com.au/property-apartment-nsw-erskineville-117126663
http://www.realestate.com.au/property-apartment-nsw-erskineville-116907423
http://www.realestate.com.au/property-apartment-nsw-erskineville-116906867

Rent:
http://www.domain.com.au/property/for-rent/apartment-unit-flat/nsw/erskineville/?adid=9183998&sp=3
http://www.domain.com.au/property/for-rent/apartment-unit-flat/nsw/erskineville/?adid=9186117&sp=4
http://www.domain.com.au/property/for-rent/apartment-unit-flat/nsw/erskineville/?adid=9170339&sp=13

Erskineville is not the only one, 5% yield does not require western sydney at all..
There are lots of suburbs < 5km to the city that have good yields.
Unless you are looking for house on land then it's more difficult.

Thanks for the tip! I will checkout Logan area.

Cheers

 

[vaughan]

Lots of examples.

One is Erskineville. 1 Bedrooms rent for $500-$600pw, prices are around $500k
At $550pw that is about 5.5% gross...

No point looking at gross rent with strata titles properties, the strata fees can be a HUGE expense.

None of those listings mentions the strata fees.

 

[Redom]

Hmm, macro data doesn't seem to match your hypothesis. But your evidence is pretty solid from those examples.

See chart below; the fall in yields is quite steep in Sydney YoY given the price gains. Brisbane has seen a much smaller % fall.

http://www.propertyobserver.com.au/images/2014/05/22/kusher-may-22-four.gif

 

[Peter Parker]

What yields should we be expecting on older units along the north/south train lines < 10km to the CBD in Brisbane?

Around 6% in Brisbane suburbs is good though nearer to 5.5% is much more common.

Here's an example recent sale. It's a 2br yielding 6% in a smaller older block with its own garage. It's walking distance to everything in a good suburb 9km from Brisbane CBD.

http://house.ksou.cn/p.php?q=Corinda&sta=qld&id=463102

This similar 2br place nearby http://www.realestate.com.au/property-unit-qld-corinda-117372871 went under auction on Sunday. They were quoting $240k+ but that would have been a steal; it last sold for $295k in 2011. Would be interesting to see how much it fetched.

 

[saiman]

Lots of examples.

One is Erskineville. 1 Bedrooms rent for $500-$600pw, prices are around $500k
At $550pw that is about 5.5% gross

Buy:
http://www.realestate.com.au/property-apartment-nsw-erskineville-117126663
http://www.realestate.com.au/property-apartment-nsw-erskineville-116907423
http://www.realestate.com.au/property-apartment-nsw-erskineville-116906867

Rent:
http://www.domain.com.au/property/for-rent/apartment-unit-flat/nsw/erskineville/?adid=9183998&sp=3
http://www.domain.com.au/property/for-rent/apartment-unit-flat/nsw/erskineville/?adid=9186117&sp=4
http://www.domain.com.au/property/for-rent/apartment-unit-flat/nsw/erskineville/?adid=9170339&sp=13

Erskineville is not the only one, 5% yield does not require western sydney at all..
There are lots of suburbs < 5km to the city that have good yields.
Unless you are looking for house on land then it's more difficult.

Thanks for the tip! I will checkout Logan area.

Cheers

In that case you should check out the 1 bed/studio units in Ultimo. 8% + yields

 

[Ace in the Hole]

In that case you should check out the 1 bed/studio units in Ultimo. 8% + yields

Yep, no shortage of those available at yields just shy of 10%.

 

[danwatto]

Yeah you mean the student ones?

The ones I saw in Ultimo were student accommodation and so tiny, and only students are allowed to occupy. Bank guy will respond "computer says noooo" I'm sure!

I like the one with the first line "This fully furnished 23sqm, 1 bedroom"

 

[imbi3]

Yeah you mean the student ones?

The ones I saw in Ultimo were student accommodation and so tiny, and only students are allowed to occupy. Bank guy will respond "computer says noooo" I'm sure!

I like the one with the first line "This fully furnished 23sqm, 1 bedroom"

You can also find student accommodation in Melbourne with the same yield...