Brisbane market tested

[MJK]

Back in June 2004 I decided to put one of my Brisbane IPs on the market. The RE agent said I should have sold it in Nov or December 2003 and I could have got 290K for it. Anyway I put it on the market hoping to get 275K.
I actually got a contract for 269k but the buyers finance wasn't approved so it fell over.
Now its November and the agent says they could have sold it 6 times over for 250k. I reassessed my postion and have taken the property of the market.

So in this case prices have come back about 15% in the last six months.

The yeild on my original purchase price is 6.8% so I'm happy to let it sit in the portfolio until the market picks up again. purchase price $153k

MJK

 

[FatBoy]

MJK: What area was that in ??

A friend of mine with a place in Cleveland is still claiming that it's going up everyday and i have a sneaking suspicion his PM is telling him porkies...

Cheers,
Paul...

 

[MJK]

Stafford / North Brisbane and I'm pretty sure they are porkies.
Mind you I stll have a lot of faith in the Brisbane market over the next few years.

MJK

 

[FatBoy]

Agreed. I believe "coastal" Queensland will continue to do well for a while yet. In particular, Brisbane, Mackay, and Townsville...

I'd love the foresight to compare gains in Brisbane compared to Sydney in the next 5 years, i'm pretty certain Brisbane would be way ahead...

Cheers,
Paul...

 

[astroboy]

Back in June 2004 I decided to put one of my Brisbane IPs on the market. The RE agent said I should have sold it in Nov or December 2003 and I could have got 290K for it. Anyway I put it on the market hoping to get 275K.
I actually got a contract for 269k but the buyers finance wasn't approved so it fell over.
Now its November and the agent says they could have sold it 6 times over for 250k. I reassessed my postion and have taken the property of the market.

So in this case prices have come back about 15% in the last six months.

The yeild on my original purchase price is 6.8% so I'm happy to let it sit in the portfolio until the market picks up again. purchase price $153k

MJK

Interesting MJK
Stafford has alwas been a bit of a neither here nor their market. You do don't say what sort of property it was so it is difficult to tell as to whether you property is indicative of the market or not. There are a lot of post war and semi moderns in Stafford that have never attracted more than mediocre market prices, no rail and less than ideal bus links don't help even though you are relatively close to the city.
I have just had another reval done on a property a bit closer in and had a gain, on the reval, of 10% in less than 6 moths since the last valuation.
There are suburbs and there are suburbs, stick with the more desirable and you wont go wrong.
ab

 

[Matt Mc]

Val

Astroboy; any chance of a mention of which suburb you are referring to with a 10% val increase in 6 mths?

Thanks

 

[Hound Dog]

Hi MJK,
The suburb of Stafford features in the Business Section of todays Courier Mail.27/11/04 .The profile is pretty accurate but the area is reliant on the bus system for public transport .Personally I prefer to look at suburbs serviced by the rail system. I have always liked Stafford due to its location and other facilities.Lots of ex Commision houses ripe for renovation etc.
You would not have much of a problem renting a house out in Stafford. I don't know why you have not sold .Maybe you need another agent. I see lots of sense in staying with the property if you have brought well and are happy with the yield.
Cheers
Hound Dog

 

[MJK]

The property is a post war highset on a main road which is not as desirable as a quiet street although the bus stop is only 100mtrs away. Also I have not touched it and it is in need of renovation so in the current slow market it makes it difficult to off load. Of course I could sell it for 250K but I'd rather wait a year and see what gives. I have plans to paint the property inside and out and polish the floors. I'm not in any hurry to sell / I dont need to sell, I just thought I'd cash in but only at a figure I'm happy with, whether that be today or a couple of years from now or never doesn't matter.
I just thought it would be interesting to share my experience with this sale attempt.

MJK

 

[Dos]

It is very interesting to see how people are travelling within Brisbane and the difference in results suburbs and areas can produce. We are on the southside and yep, still increasing in value. We were given a very rude shock when the house 2 doors up from IP in Runcorn went on the market 2 weeks ago for $105k greater than our valuation 6 months ago!!! PPOR has also increased in value in the past 6 months. I know that the Cleveland, Manly, Wynum area is still taking quite good gains based on re-vals of people in those areas!

Dos

 

[shazza]

Wynnum area

It is very interesting to see how people are travelling within Brisbane and the difference in results suburbs and areas can produce. We are on the southside and yep, still increasing in value. We were given a very rude shock when the house 2 doors up from IP in Runcorn went on the market 2 weeks ago for $105k greater than our valuation 6 months ago!!! PPOR has also increased in value in the past 6 months. I know that the Cleveland, Manly, Wynum area is still taking quite good gains based on re-vals of people in those areas!

Dos

It probably does depend on area. We just had our townhouse in Wynnum West valued and it came in $5k short of the last sale price here (in Sept) and we have an additional aircon unit. I know there's a difference between market price and valuation price - is this a good or bad valuation?

Having just bought a PPR in the area too, the market is definately quite soft - and just because someone puts a price on it- doenst mean someone will buy it for that. If a house is priced too high - it will sit for months and months.
So I'd watch what price the house in Runcorn actually sells for - a lot of vendors are thinking its Nov 03 not Nov 04.
cheers Shazza

 

[likewow]

It probably does depend on area. We just had our townhouse in Wynnum West valued and it came in $5k short of the last sale price here (in Sept) and we have an additional aircon unit. I know there's a difference between market price and valuation price - is this a good or bad valuation?

Having just bought a PPR in the area too, the market is definately quite soft - and just because someone puts a price on it- doenst mean someone will buy it for that. If a house is priced too high - it will sit for months and months.
So I'd watch what price the house in Runcorn actually sells for - a lot of vendors are thinking its Nov 03 not Nov 04.
cheers Shazza

Right on Shazza. The price a valuer puts on a property and the price a buyer pays for the same property are two completely different things. In the end the market talks.

 

[MJK]

Actually I also have a place in Runcorn but there are heaps of properties on the market there and they are not moving quickly. Past gains have been good. Brisbane as a whole will hopefully gain some momentum again with popultion increases that many have predicted.

MJK

 

[Dos]

Agreed and hence the "shock" when we saw the price. I do not think it will sell for that price but if it sells for anything near it, we will be very chuffed!!

There are as many for sale signs around now as there were prior to the massive buying frenzy in that area but as you say MJK, they are going a lot slower. Mind you, the prices are a lot higher than what they were 2 years ago, the gains have been fantastic.

If you ever need someone to do a "drive-by" or need some info on the area MJK let me know. I am at Calamvale so only 1 suburb away!

Dos

 

[MJK]

Thanks Dos, a very generous offer.
For now just keep us informed of any market highlites!

MJK

 

[DOC]

Hi everyone,


With regard to the Stafford market I had a friend who recently (3 months ago) sold a 2 br +study weatherboard house in the Stafford Heights area. The bank had valued it at 420k and he ended up selling it for 415k. He had purchased elsewhere with bridging finance and was happy to take the offer considering the context. He took less than the val but he did sell in 3 days.
His other purchase has already realised CG (according to bank val and offers by other buyers post settlement), so he is happy. His other PPOR is at Buderim.


Cheers, DOC.

 

[willair]

I think stafford is still a good investment area,i sold on of our properties
21 weeks ago in that area in the high part,one thing to keep in mind
with that area is the property we sold was in a Demolition control
precinct and as we found there are few acceptable solutions once
the DC applies.the property sold for 540k,3 bedroom highset on 831
sm,LMR.
good luck
willair..