beware surat basin

hi all
just a heads up about a property that my partner bought in Chinchilla about a year ago. it is a furnished townhouse that has been returning $465/wk but the tenant moved out three weeks ago and since then, there have been no nibbles at all.

so it appears that we will have to have all the furniture moved out and take a hit on the rent from $465 down to $330/wk. that makes a significant impact on the cashflow, taking it from positive to negative.

i notice that spruikers are still offering properties in the area and claiming up to $500/wk rents.

api list rental vacancies listed at 5.8% in the area.

it seems that the initial apparent shortage has been dealt with and now there is a glut.
 
hi all
just a heads up about a property that my partner bought in Chinchilla about a year ago. it is a furnished townhouse that has been returning $465/wk but the tenant moved out three weeks ago and since then, there have been no nibbles at all.

so it appears that we will have to have all the furniture moved out and take a hit on the rent from $465 down to $330/wk. that makes a significant impact on the cashflow, taking it from positive to negative.

i notice that spruikers are still offering properties in the area and claiming up to $500/wk rents.

api list rental vacancies listed at 5.8% in the area.

it seems that the initial apparent shortage has been dealt with and now there is a glut.

There is a water recycling project that is earmarked around Chinchila soon, so may bring a bit of hype?

I think the API is a pretty good mag, but just gos to show that you shouldn't believe everything you read from it.

There are 2 full page ads from these guys every month talking up the areas. Just need to do own research and buy yourself, rather than paying any commissions to these guys!!

F
 
Stay away

Good post Grace. I agree.

I had a guy send me some info on brand new boxes he was (let's say) facilitating...........he was only one level of the commissions and fees web, in Chinchilla.

Positive cashflow and simply the best properties was the catch cry. He purported that 370-385K would get a new box on dirt with a starting rent of b/w 500-550 p/wk. LOL

I met him at a property briefing a couple of month ago and he sent me the info, and the out of date propaganda of the areas growth drivers. A quick check at that time early March 2010 brought me to the conclusion, NUP!!!!!

Rents were around 350 p/wk to 400 p/wk with yields around 5 % and of course town risk. Ther were 50 properties for rent at that time, in a town of around 5,000.

No thanks. If one already had a property there having held for many years and bought for next to nix, great. There may be upside again. However right now, those over-priced spec homes are yiedling capital city returns and with huge risk IMO. I recall that second hand properties were however selling in the low to mid 200's so (depreciation aside), they were likely to be better value for those that were looking to invest there.
 
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