Investing in Dysart QLD

[keenas]

Hi

I am new to this forum and reasonably new to property investing.

My Broker has just given me the green light to go out and purchase another investment property.

This will be property number 3 for me and I have around $350,000 to spend.

I have been having a serious look at Dysart. Yields look great and there seems to be a bit going on here in terms of growth.

What do the fellow forumites think of this area to purchase property in ??

Does anyone reading this forum already own property in Dysart ??

Any advice would be greatly appreciated.

Cheers

Keenas

 

[Aimjoy]

keenas,

hi. I don't have an IP in Dysart.

But several things would worry me about investing in a place like this:
1. Population - less than 3,000
2. Renters make up over 75% of these

If it is going thru a growth phase I suspect it is mining related. If so, when the mining boom is over (and it will be over one day), and a lot of the renters move out - what do you reckon that does to property prices?

For $350K you can buy in city like SYD MEL or BNE and have many tenants to choose from who are employed by more industries less likely to suffer a downturn (all at once) at some point.

My 2c.

Aimy

 

[Bullfrog]

Dysart

Hi Keenas,

We've had a property in Dysart for the past 2 and a bit yrs. It was our first I.P. We've had 2 tenants over that timeframe and it hasn't been empty at all. 3brm older style house with a newish kitchen and large back verandah. We started out with rent of $450/wk it's now up to $615/wk

Dysart is listed in this months API in their top 100 growth suburbs and APM is predicting spectacular growth of 46.5% growth over the next 12 months providing the resource sector keeps powering ahead.

Thats the good news now for a word of caution. From what I understand all of the local mines are in the throw's of negotiating new EBA's with all their workers. This has meant a slowing in the rental and resale market as no one is prepared to do anything until the've signed of on new agreements. Moranbah, 60k's north went through the same process but have just signed of on new agreements. All being well the mines around Dysart will sign of by the end of the month

Also shop around for a R/E company who will give you good service out there. I've not been happy with mine and I'm about to change. Most agents are in Mackay and it's a 2 1/2 hr one way drive.

Overall we've been very happy with the performance of our property and regret not having bought 2 when we could.

Happy Investing

Regards Bullfrog

 

[keenas]

Thanks for your input Aimy.

Dysarts population is actually sitting at around $5,000 - and thats before the next 450 workers rock into town to build the next mine.

All looking for accomodation I'm thinking.

This would be a short term investment - a couple of years maybe, cash in and outa there.

Its certainly tempting with such a good yield and predicted capital growth.

Decisions decisions !!

 

[keenas]

Hi Bullfrog

Thanks for your input.

I did read that article in API - so have many others according to the Agents in Mackay. They reckon its "going off".

Sounds like you are about to do even better with your property there.

I feel confident about buying there. It would only be a short term plan.

I have another property in Boulder WA and that has done great things for me. Love the high yields in the mining towns

Who is your property Manager for Dysart at the moment and who are you changing to and why ??

Thanks again for taking the time to respond.

Keenas

 

[Aimjoy]

This would be a short term investment - a couple of years maybe, cash in and outa there.
Its certainly tempting with such a good yield and predicted capital growth.
Decisions decisions !!

Hi keenas,

My initial advice, my opinion only mind, was based on your heading "Investing in Dysart QLD". And long term I think you can end up with a ghost town scenario when the mining boom is over / or we become uncompetitive in the marketplace (i.e. the world buys stuff from Africa or Russia for example). It is not uncommon for mining companies to just pack up and leave when this happens.....so be careful. An un-rented $300K IP is not worth much when this happens.

I had serious concern about "investing" which I see as "buy & hold". Now it seems you are not talking about "investing" so much as you are "speculating" or "trading" which is a short term thing.

Due to the high transaction costs of RE - getting in & out and the difficulties of finding a Property Manager on-site I still have concerns.

Will you make money - probably - maybe a lot - I dunno. Bullfrog did OK - will you? - I dunno.

If you want to speculate, then I find the Share Market a lot more liquid and transaction cost friendly than RE. But I know others are not comfortable doing this.

All the best with your decision.

Cheers,
Aimy

 

[kum yin lau]

Hi Aimy, good reply. My 1st reaction was "Dysart SA"? Where on earth is that? I've heard of Barmera [that's where they have something to do with uranium or something like that - there's a golf course, my sister hit a balls there! And hot air ballooning, I think.

Dysart? I've invested in property in Adelaide for 10 years & never heard of the place.

The strategy rests on finding someone to offload your IP onto when you think you've enough profit. The greatest risk will be if no one buys it from you.

But then again, many people seem to be benefitting from mining towns, so..?

Think carefully & good luck.
KY

 

[Aimjoy]

KYL,

I think you'll find keenas was talking about the Dysart in QLD - mining town.

Aimy

 

[Novar]

Hi Keenas,


Thats the good news now for a word of caution. From what I understand all of the local mines are in the throw's of negotiating new EBA's with all their workers. This has meant a slowing in the rental and resale market as no one is prepared to do anything until the've signed of on new agreements. Moranbah, 60k's north went through the same process but have just signed of on new agreements. All being well the mines around Dysart will sign of by the end of the month

Happy Investing

Regards Bullfrog

As far as I'm aware Moranbah has not yet signed agreements. I'm not even sure they're too far into negotiation.

2 yrs ago houses in moranbah were snapped up and they were few and far between at any one time. Now you will find 30 houses listed for sale.

I have a friend who sells R/est in MKY she bought a house in Dysart 18 mths ago for $315,000 . I talked to her 6 mths ago, she was selling and hoped to get her purchase price back. Haven't seen her since so don't know the outcome.

 

[Modal Harmony]

I work in the Engineering design and project management industry for mining projects and Aimjoy is right on the ball; when (not if) a downturn occurs in the resources sector, rental yields will suffer. I'd check the All Ords Index and (especially) the mining stocks indices carefully to keep a close watch......

 

[Novar]

.

I have a friend who sells R/est in MKY she bought a house in Dysart 18 mths ago for $315,000 . I talked to her 6 mths ago, she was selling and hoped to get her purchase price back. Haven't seen her since so don't know the outcome.

For anyone interested

Saw this friend yesterday and she has just sold her house in Dysart. So it's taken her quite a few months to offload it.

 

[WBG Redcliffe]

IMHO mining towns can be awesome they have to me. But I believe that you should have an exit strategy in place from the beginning. A full understanding of the industry that drives the community, and profit up front on every investment in the area. Short to medium term investment only.

 

[Muffinman]

I was just in Dysart last week , and have been there on and of for last 12 months.
Reason why we keep returning is because there is NO accomdation in the area. Solid book for 12 months, we stayed at Motel on and off on vacant times very limited.
Thiess have 250 guys starting at the new lake vermont mine and we just completed the new substation.
The Dysart substation is having another extension to handle another two mines including the new vermont about to start.


Best of luck finding an IP I just purchased 2 in the area and it was just luck, currently have both rented out $750 per week for next 5 yrs to mine.
The Mac camp just added another 200 rooms and still booked out, but there has been some new released land being developed.

 

[devank]

Ehhh.... Is this what they call too little too late? Still happy to know what you think about that suburb though.

 

[keenas]

dysart

Crikey APWPG I have bought and sold 2 properties in Dysart since My original post in 2007 Did very well indeed. I still hold 1 in Dysart and 1 in Moranbah.

Keenas