Brisbane heats up

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From: Anonymous


I can't count the number of times I've read articles saying that Sydney can go no further, and how Brisbane is going to boom between 2003 and 2005 (if it hasn't already done so).

But, if you want to invest there and are not a QLD resident, how do you go about it, assuming you haven't time to fly up there on the odd weekend to do your due diligence. We've all heard bad stories of QLD and interstate investors. Are buyers' agents the answer?

More generally, if you accept (and I think most of us do) that there are different cycles in different cities, how in general do people go about buying where you think the next boom / best value is?
 
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Reply: 1
From: The Wife


So...is the question

" How do I pick the best areas to invest in without having to perform due diligence?"

I dunno, I tend to lean towards due diligence.

Buyers agents? well if you must , try ross sondergeld, Ive sent quite a few people to him, they all came back saying he was ok.

TW
 
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Reply: 1.1
From: E L


Anon
Nothing beats seeing suburbs for yourself and getting a feel for the area. When you're there on a mission and have reasons for being there - I think you learn so much.

We've done a few dashs interstate over long weekends and used accrued leave to look at property. It's worth the effort if you're clear and focused as to what you're wanting to achieve.

Cheers
EL
 
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Reply: 1.1.1
From: Tibor Bode


I am Sydney based and am a very active investor in Brisbane. There is tons of info available. Residex to start with (QLD reports), Matusik, Government sites, Local councils, various internet property sites.
I bought 2 properties over the net (local friend had a quick look at them) and in the process of buying with my friends another 5 now. They will drive up to see them. I am personally rather interested in the numbers.
Also talking to agents (good ones are excellent source of information) who know you. My friend went up a couple of weeks ago (long drive in 4 days) and picked up a property with 12.5% gross. Getting some info from API also good as well as local papers and R/E brochures. You just have to use your brain to find the sources. And I am sure there is lots more.

Tibor
 
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Reply: 1.1.2
From: J Parker


Have to agree with EL and The Wife here- if you're prepared to spend a few hundred dollars (depends on where you're flying from , though!) on airfares you can look at a lot of properties in a couple of days!

Last trip I did to Brissie I scoured the interiors of some 20 odd places in two days. Most of these were pre-organised beforehand, though the property I ended up buying was first listed in that weekend's Courier Mail! Had I been in Sydney and tried to see it the following weekend, it would have been sold. So, being there has it's advantages for sure. It's also a lot of fun, flying up and looking at so many in such a short amount of time. You tend to achieve a lot to justify the airfare! Just think of it this way- when you're at the negotiating table, total up your travelling costs and deduct them from the final offer!
Good luck
Cheers, Jacque :)
 
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Reply: 1.1.2.1
From: Gail H


Hi,
Well, I have just bought 2 properties in QLD (Sunshine Coast) that I have never seen. I know its taking a risk, but I had been following prices in these areas for ages, and when the properties came on the market, I knew they were cheap and would be gone by the time I got there.

So, one property I bought for $125,000 five mins from the beach. I got digital photos emailed, and building inspection etc. done. I know I have taken a punt, but the price was incredibly good and the rent covers costs.

The second one is an almost new townhouse that overlooks the twin waters canal ($164,000). The price was good for a place with a water view and the rent will cover costs. Again, I got inspections done and photos emailed. I also asked a competing agent who was trying to flog me a different property what was the worst thing they could say about the property which I ultimately bought (they couldn't think of a thing).

I found both of these places on the internet - I was following the listings of several towns which my research had told me were good places to buy.

So, I have taken a big risk (my family and friends think I am stark raving mad), but I believe its a calculated risk and I knew I couldn't fly up in time to see them.

So, I'll see them for the first time in July. But, I am also of the view that $500 for an airfare is nothing when you are thinking of dropping 150,000 grand or so on a house. I have flown interstate to look at properties before, and it is a lot of fun.

Wish me luck everyone!

Gail
 
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Reply: 1.1.2.1.1
From: The Wife


Gail,

From everything you said, you just practised one hell of a lot of due diligence.

Good Luck!! Although I'm sure you wont need it, you have researched it well.

Cheers, TW
 
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Reply: 1.1.2.1.1.1
From: Tibor Bode


Gail,

Congratulations. You managed to get over the I have to see in syndrome. You have to research it and have the numbers. The building and pest inspection (with a good firm) will tell you what you would not be able to see anyway, the colour of the wall, etc are not important. What you can improve and for how much it is.

I have bought and also renovated property without seeing it. With a good team of people it can work even a reno. Bit more expensive, but I can earn more and find more properties until someone else does the painting.

Tibor
 
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Reply: 1.1.2.1.1.1.1
From: KJL .


Gail

I'm interested in how you conducted the 'rent covers costs' due diligence.

I would think that asking the selling agent what rent a place would achieve would be courting disaster! I think I would have called other real estate agents, asked for anticipated rental of such places, and also of the demand.

Did you do that, and was there anything else that you did?

I recall reading a posting on the forum recently where it looked like a purchaser hadn't done this and suddenly found the 'demand' to have slipped between exchange and settlement.

KJL
 
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Reply: 1.1.2.1.1.1.1.1
From: Gail H


The rental due diligence was easy - the places are already rented. I had also done research by ringing different agents (posing as a potential tenant). Vacancy rates in the area are low. But, hell, I can't eliminate the risk of vacant properties - I don't think any of us can.

Gail
 
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Reply: 1.2
From: James Hardy


Hi just debating doing the same and buying in Queensland.

I'm lucky and work for QANTAS so can check out IPs while being paid to do it on over night slips.

If you do have to pay full fare to fly up and check out properties are related expenses such as car hotel and meals a tax deduction?

I would have thought so but not sure as I am only starting out in this field.

Re Queensland: we initially wanted a 'Queenslander' thinking that they would be in limited supply but a bit shocked at how many there are right across Brisbane. In terms of 'scarcity value' now questioning if they are such as good buy?

Finally which are the two or three good investment suburbs. Loved Paddington but the agent we talked to said rentals are soft at present and I worry about Howard extending the home owners grant, surely this will reduce the pool of renters.

regards james
 
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Reply: 2
From: Robert Forward


Hi Anon

Just to let you know, I provide a business structure for those who find it hard to get to a property to do their own eye ball inspection.

I have current investors who go to properties, that you find, and complete a full report about the property and the surrounding area that the property is located. For your peace of mind, these investors are also contracted so they are then unable to attempt to buy the property for a 3 month period after the inspection.

Check out my website that is listed below.

Cheers,
Robert

Property Inspection Reports @
http://www.creativefinance.com.au

The Sydney "Freestylers" Group Leader.
 
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Reply: 1.2.1
From: Gail H


Hi James,
You really are perfectly placed to check out interstate properties.

I'm no specialist on Brisbane. I bought on the sunshine coast, but I am tracking some suburbs in Brisbane. I'm looking at Hendra, Nundah, and around there. I'm also looking at the coastal suburbs like Brighton, Taigum (seems to have overupply of villas/townhouses though) and even as far North as Redcliffe and Scarborough.

My understanding is that Queenslanders are much in demand. Inner city units are the main category of property that are arguably in oversupply. I believe the rental market is soft all over Brisbane (recent boom has attracted many investors).

Good luck

Gail
 
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