Best estate for CG and Cashflow in Brisbane and surrounds.
- Thread starter ej89
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Not too sure who lives there tbh I don't know much about it other than they plan to have like 50,000 people there. I think the yield swayed him
MWDB so your investments must've done better than most who bought in estates in Sydney.....
I guess Northlakes is the closest estate to having a lot of jobs heading its way with a business park
MWDB so your investments must've done better than most who bought in estates in Sydney.....
I guess Northlakes is the closest estate to having a lot of jobs heading its way with a business park
I don't know the Sydney market, as we are builders in Brisbane. I know that generally speaking, you are going to be paying a premium for buying from a developer. I bought a block in an estate recently, but it was 'second hand'. Got it for 165k, the original owner bought it 2 years prior for 190k.
A lot of the time when buying from land developers that develop these estates you are paying 'retail' prices for land, rather than the wholesale price most investors like us are looking for. Just my 2c.
Blue chip areas like Balmoral, Bulimba?
Inner city areas like West End?
I think it's the same in all cities. Don't chase the cheap exotic ones if you don't know what you're doing.
Inner city areas like West End?
I think it's the same in all cities. Don't chase the cheap exotic ones if you don't know what you're doing.
Not too sure if your friend realize he doesn't have the free stamp duty if he's buying it as an investment even brand new, I think no stamp duty rule only apply to owner occupier.
if he does it he will have a hard time explaining to ATO why did he claim FHOG when he work in NSW and claim to be living in QLD?
Not too sure if your friend realize he doesn't have the free stamp duty if he's buying it as an investment even brand new, I think no stamp duty rule only apply to owner occupier.
if he does it he will have a hard time explaining to ATO why did he claim FHOG when he work in NSW and claim to be living in QLD?
Probably not relevant to this but many peoples live in tweed heads nsw and commute and work in Brissie Qld and vice versa
Good price. I would put Jimboomba ahead of Yarrabilba as it has the potential for a rail station
We have always built new, however it is becoming increasingly difficult to get the numbers to stack up.
Most recently we have subdivided a block to do so, I am wary of the outer suburbs such as the ones you are mentioning as there is over supply and I think there will be limited CG and potential for vacancy and low rent growth.
The problem with subdividing in Brisbane is its getting more difficult to find the 809 splitter bocks. I think we are going to move our attention to 600sq blocks within 200 metres of a Centre zone and look at builing 3 bedroom 2 story town homes.
Most recently we have subdivided a block to do so, I am wary of the outer suburbs such as the ones you are mentioning as there is over supply and I think there will be limited CG and potential for vacancy and low rent growth.
The problem with subdividing in Brisbane is its getting more difficult to find the 809 splitter bocks. I think we are going to move our attention to 600sq blocks within 200 metres of a Centre zone and look at builing 3 bedroom 2 story town homes.
If new is sold at a premium why are all the new properties we are buying for clients positively geared after tax with 100% debt?
Why are all the House & Land's that we are buying for clients valuing up by over 6% at completion? that's 6% capital growth over the Land + Build contract price? BTW I'm basing this on 50+ House & Land's we have finished for clients so far this year.
6% capital growth is equal to a 30% return on investment based on a 20% deposit.
Massive Supply really? clients aren't stupid. Who would buy anything in an area with "massive supply"? That's just plain pointless.
Can you give an example with numbers please?
Somersoft PIA.
Here is a current set of numbers for North Lakes. We use Somersoft PIA because we know the calculations behind it are correct:
https://www.dropbox.com/s/4spryjzl18wu2jx/Griffin_Lot24_Analysis_20150218 - 100% - 85k.pdf?dl=0
NOTE: the 6.72% interest rate is an aggregated number. 4.5% for the first 5 years and then we set it at 7% from year 6 onwards. You can see this on page 6.
Here is a current set of numbers for North Lakes. We use Somersoft PIA because we know the calculations behind it are correct:
https://www.dropbox.com/s/4spryjzl18wu2jx/Griffin_Lot24_Analysis_20150218 - 100% - 85k.pdf?dl=0
NOTE: the 6.72% interest rate is an aggregated number. 4.5% for the first 5 years and then we set it at 7% from year 6 onwards. You can see this on page 6.
If new is sold at a premium why are all the new properties we are buying for clients positively geared after tax with 100% debt?
HI Mark, Its not a matter of IF they are sold at a premium, most of the time they are as a matter of fact, especially if bought from a developer. Compared to other options for IP investments, buying new most of the time is a poorer and lazier choice, especially for the investors who want to accelerate their wealth creation. Perhaps your clients are more interested in buy and forget for 25 years.
Why are all the House & Land's that we are buying for clients valuing up by over 6% at completion? that's 6% capital growth over the Land + Build contract price? BTW I'm basing this on 50+ House & Land's we have finished for clients so far this year.
I'm sure this is very possible I'm not doubting it. However, its also very possible that by buying older stock, something investors can buy BMV and add some value to, they would be increasing the value by more than 6% when they are done with it
6% capital growth is equal to a 30% return on investment based on a 20% deposit.
What about 2, 10% deposits leveraging into double the asset value, both buying BMV and adding value
Massive Supply really? clients aren't stupid. Who would buy anything in an area with "massive supply"? That's just plain pointless.
This happens every day of the year. Clients buy in places with massive supply.
This is all just 1 man's opinion mate.
Leo
LeoT, you live in Sydney, why don't we meet up and talk about this over a coffee and I will show some actual sales data to back up what I am saying. My number is below.
HI Mark,
No mate, I never called you a liar at all. Just a typing/communication misinterpretation. Apologies if you felt I was saying that.
With reference to some comments you made: "There is no way I would recommend that a client uses more than 80% loan to value ratio borrowing as a strategy. It's just too risky for an inexperienced investor to manage debt with that level of risk. In my option LMI should be for 1st Home Buyer only."
I know many people on average incomes who have used much less than 20% for a deposit, and this did not increase their level of risk dramatically. It also allowed them to get into the market and build wealth much faster. To say I strongly disagree with you that LMI should be for 1st Home Buyer only is an understatement of the century. LMI is so misunderstood by the vast majority of first time investors. Many first time investors have good employment cashflow, some have decent amount of equity/deposit and for any company to only steer them towards a 20% deposit as any less is too risky, is in my opinion a great disservice to them.
I appreciate your offer to meet up and discuss, but it would be a waste of your time. I understand your approach now and its not something I can be swayed on. Again, this is all my opinion. Others may completely agree with your sentiments.
Cheer
leo
No mate, I never called you a liar at all. Just a typing/communication misinterpretation. Apologies if you felt I was saying that.
With reference to some comments you made: "There is no way I would recommend that a client uses more than 80% loan to value ratio borrowing as a strategy. It's just too risky for an inexperienced investor to manage debt with that level of risk. In my option LMI should be for 1st Home Buyer only."
I know many people on average incomes who have used much less than 20% for a deposit, and this did not increase their level of risk dramatically. It also allowed them to get into the market and build wealth much faster. To say I strongly disagree with you that LMI should be for 1st Home Buyer only is an understatement of the century. LMI is so misunderstood by the vast majority of first time investors. Many first time investors have good employment cashflow, some have decent amount of equity/deposit and for any company to only steer them towards a 20% deposit as any less is too risky, is in my opinion a great disservice to them.
I appreciate your offer to meet up and discuss, but it would be a waste of your time. I understand your approach now and its not something I can be swayed on. Again, this is all my opinion. Others may completely agree with your sentiments.
Cheer
leo
Here is a few purchases that I have bought in the North Lakes LGA with a resent sale to compare to.
Address - Purchase Date - Purchase Price - Current Valuation - Approx.Capital Growth - Type
Mannikin St Griffin - 12/2013 - $411,000 - $484,000 - $73,000 - House 4BR, 2Bath on 448m2
Swallow St Griffin - 05/2014 - $422,000 - $484,000 - $62,000 - House 4 BR, 2 Bath on 432m2
Oriole Ct Griffin - 08/2014 - $439,000 - $484,000 - $45,000 - House 4BR, 2Bath on 407m2
Challenor St Mango Hill - 01/2015 - $468,000 - $505,000 - $37,000 - House 4BR, 2Bath on 420m2
Recent Sales for comparable property:
Lot 82 The Pocket, Griffin - 04/2015, 4BR, 2 Bath House (209m2 house on 450m2 land) - $486,500
Address - Purchase Date - Purchase Price - Current Valuation - Approx.Capital Growth - Type
Mannikin St Griffin - 12/2013 - $411,000 - $484,000 - $73,000 - House 4BR, 2Bath on 448m2
Swallow St Griffin - 05/2014 - $422,000 - $484,000 - $62,000 - House 4 BR, 2 Bath on 432m2
Oriole Ct Griffin - 08/2014 - $439,000 - $484,000 - $45,000 - House 4BR, 2Bath on 407m2
Challenor St Mango Hill - 01/2015 - $468,000 - $505,000 - $37,000 - House 4BR, 2Bath on 420m2
Recent Sales for comparable property:
Lot 82 The Pocket, Griffin - 04/2015, 4BR, 2 Bath House (209m2 house on 450m2 land) - $486,500
One off high loan to value ratio's are one thing, but I said as a "strategy" I wouldn't recommend it.
Never the less high debt does increase risk and I'm all for reducing risk as a principal. Any level of debt carries some risk and I've seen too many financial train wrecks to be complacent about high debt levels.
With reference to some comments you made: "There is no way I would recommend that a client uses more than 80% loan to value ratio borrowing as a strategy. It's just too risky for an inexperienced investor to manage debt with that level of risk. In my option LMI should be for 1st Home Buyer only."
Mark, calling yourself an investment advisor I would have expected a bit more of an educated and informed response that to just say anything over 80% is risky...
What about 2 high income younger professionals? It may be easy to say they should just wait and save the deposits up, but with moving markets and the ability to leverage via LMI, there is the potential to be in a much better equity position than chasing a deposit for a property where prices are rising month on month...
It is horses for courses and understanding the client, their risk profile and end goal.
Mark, calling yourself an investment advisor I would have expected a bit more of an educated and informed response that to just say anything over 80% is risky...
What about 2 high income younger professionals? It may be easy to say they should just wait and save the deposits up, but with moving markets and the ability to leverage via LMI, there is the potential to be in a much better equity position than chasing a deposit for a property where prices are rising month on month...
It is horses for courses and understanding the client, their risk profile and end goal.
Absolutely. Well said. This approach would be in the best interest of all clients.
Leo
There is a time and place to reduce debt, and for the vast majority of investors, it wont be after their first few IPs.
Leo
Your both right!
But when interest rates rise, I'm planning that my clients won't be forced sellers.
I'm not paid to be adventurous with my clients money, I'm paid to give them good advice. If you think i'm being conservative, you should speak to their accounts and financial planners.
But when interest rates rise, I'm planning that my clients won't be forced sellers.
I'm not paid to be adventurous with my clients money, I'm paid to give them good advice. If you think i'm being conservative, you should speak to their accounts and financial planners.
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