Auchenflower, QLD - Unit

Y

YPG

What are peoples thoughts on Auchenflower, QLD?

My parents have asked me to find them an IP in Brisbane for around 350-400k and I suggested thinking around the Auchenflower/Paddington/Rosalie area. (We live on the Gold Coast/Brisbane and they would like to be able to keep an eye on it).

Yield isn't critical as they are looking for capital growth and plan to buy outright - so around 5-6% would be the aim.

I rented in Auchenflower this year and I really like it. For me it is one of Brisbane's best suburbs (along with Paddington). A unit we would be looking to buy would be listed undervalue, close to the train station, close to toowong and wesley hospital, close to the park road and rosalie restaurant, etc.

Do people think that Auchenflower is bound to bounce back and receive significant capital growth over the next 10 years as it is just 2km from the Brisbane CBD and is already a desirable place to live?

I thought I read somewhere that the mining boom in QLD might have a postive effect on the Brisbane CBD as work is created in the office sector as well out in regional areas - but I am not sure, might have just made that up haha. But I thought I read it somewhere.

Anyways, any thoughts on the prosperity of Auchenflower - good or bad, would be greatly appreciated.

Cheers
 
Hi YPG,

I also rate Auchenflower. We live in Bardon, just around the corner, and think the whole inner West of Brisbane is great. About the only downside to Auchenflower is the traffic along Coronation Drive, but this will likely lessen once they get the tunnel built out to Centenary Motorway.

Auchenflower is spitting distance to the city, has the great cycleway all the way along the river. Is a short skip to Southbank, has ferries out front and a host of local restaurants like Park Rd in Milton.

Its a good time to be buying in Brisbane, and Auchenflower is a great spot.

Cheers,
Michael
 
I used a Buyer's Agent when I wanted to buy in Brisbane 18 months ago- they steered me to Auchenflower, a suburb I'd never heard of. They secured the property a day after it went on the market, one day before the first OFI. I paid $399K and it rents out for $350pw. It's got the same tenants in it now, that were there when I purchased.

Agent focused on a unit that was very liveable but had room to improve down the track. Yield isn't amazing (compared to my other IP in Ashfield NSW) but it's a great size unit (1214sqm) with parking and 2 balconies.

When I dealt with the Buyer's Agent, my instructions were to find something inner Brisbane (didn't care where) that was 2 bedroom with great capital growth potential and I deemed that more important than yield. Fortitude St Auchenflower is what I ended up with. Hope this helps.
 
Thanks for your replies guys.

Michael I also like Bardon, I suggested maybe looking for a house in Bardon around 450-500k mark as I feel that units may not be as good/desirable/CG potential as they would be in Auchenflower/paddington. Do you agree with this?
I think my parents were more comfortable with the 400k or below anyway.

Good point about the traffic on coro - another thing I noticed when renting this year was Milton rd was always really busy from 4:45-5:45 so I don't think I want a unit right of Milton rd.

Would you guys recommend a 2 bed unit over just a 1 bedder? Is the general mindset that 2 bed apartments have greater chance of CG and slightly higher rental yield? I was thinking that if a 1 bedder came up that looked promising it could always be rented to a couple.
 
Hi YPG,

Yes, I'd think a house in Bardon for that sort of price would be a steal. There are some around for that but they'd need a little work. Most are in the $550-600K sort of entry level range for a house. I've bought a vacant block following a recent knockdown and subdivide so I can develop it.

Auchenflower and Paddington work for units and there are some in Bardon, but Bardon houses are a saught after commodity. They're suffering at the hands of the current durntown so there are some bargains around. We got our 420m2 block for $370K reduced from $440K. I'll develop a brand new 5 bedroom custom designed three level house on it now for about $200K which will value around $800K at completion for a tidy little profit. Good market to be playing in anywhere in Brisbane at the moment.

Cheers,
Michael

PS Redcat, yes 1214m2 is a big unit!! ;)
 
Yeah Michael - appears your estimate of 550-600k is more accurate.

I think I remember seeing a few around the 500-550k mark a few months ago but like you said they needed a bit of a renovation.

From how I understand it - 1 bed room units can provide higher rental yields but 2 bed room units can provide higher capital growth? Is this assumption 'generally' correct.

Another assumption I am making when looking at potential IPs is that I can get at least 10-15k off the asking price. So much stock available at the moment and the real estate agents know that I am looking for an IP and have no emotional connection and have 5 others lined up if this one falls through.


An off topic link - peoples thoughts on Salisbury and this house? within 10km to the CBD and less that 100m to train? I do not know much about Salisbury though. fairly level 600m block - duplex/2 townhouse potential?

http://www.realestate.com.au/property-house-qld-salisbury-108201296
 
YPG. I walk past that house every day on my way home from the train station. I've looked at it too but I wouldn't go there unless I could get it at a little less money than the asking price... because...
- very original condition, needs large renovation which could be quite expensive w/ asbestos etc, no privacy from the street, people park out the front when the train station carpark is full and you'd need a kitchen, bathroom, landscaping/front fence to add any kind of appeal for a good tenant
- directly opposite train station, think you'd limit your tenants considerably
- only has 2 bedrooms
- I think that location has very limited capital gain potential (not Salisbury in general, just this block due to its location near the train)

However, they are on their 4th (!!!!!!!!!) agent so are obviously desperate to sell which puts you in the right position to offer what you think is a reasonable price. After a sizeable reno I still think you'd struggle to get near 380k for this property in today's market. A 4br house across the street with lovely gardens & very well maintained sold for $425k after being listed at $480+ (which was wishful thinking in that location anyway).

The biggest bargain in Salisbury at present is 19 Winsome Ave- 4 br house currently on sale for $419k. It was purchased in 2010 for $490k and is on a 809m2 block of land (this size can be subdivided). I can't believe it hasn't been snapped up yet.
 
amiaow said:
The biggest bargain in Salisbury at present is 19 Winsome Ave- 4 br house currently on sale for $419k. It was purchased in 2010 for $490k and is on a 809m2 block of land (this size can be subdivided). I can't believe it hasn't been snapped up yet.
Click to expand...

Yeah at a glance it looks to be able to be subdivided - meeting the 400m and 10m frontage for each block.

From a rough look it appears to be 900m+ from train station which might be slightly outside of the 400-800m walkable catchment that the average person is willing to take part. But still walkable
 
I figured they had just run into desperate circumstances and needed an urgent sale as that is a big loss to take in a year (although an inflated price in the first instance IMO). I walk 1.3km from my Salisbury street to the train station and it's under 15 minutes, though my next door neighbour drives without fail!
 
great spot never have a problem finding tenants

also have a look at west End some of the older apartments have been hit hard in the current market and with the new apartments that are being sold are getting a good return. 2 bed 1 bath 1 car older apartment will sell for $350,000 to $370,000 return $380+pw mine $450pw furnished only 1 day of vacancies in the past 3 years.

let me know if you want a independent rental appraisal on any property you are considering purchasing
 
Sorry to repeat, but can anybody clarify this:

From how I understand it - 1 bed room units can provide higher rental yields but 2 bed room units can provide higher capital growth? Is this assumption 'generally' correct.
 
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