Oakey - Regional properties with large land component

[YPG]

Hey guys,

So after sitting down with my parents for dinner and a bit of conversation - I was discussing something property related when they told me that one of their old friends was about to sell a few hectare block in greater Townsville for $3,000,000 to a developer that had approached them and that they remember the day they went with them to secure that block... and guess for how much.... $20,000 20-30 years ago. Pretty awesome stuff.

So it had me thinking. And obviously this is not an easy question and just speculation where we will most likely be incorrect, but who here wants to have a guess at a possible location of where a regional area has a large component for land at a low price that could one day be developed/rezoned and lead to an excellent gain?

After a quick search I thought I would check Oakey. I didn't know much about Oakey except that it is home to the Australian Army aviation base and is approximately 20km west of Toowoomba. But after looking into it, it has a hospital, race cource, state primary and secondary school, preschool, foodworks, medical centres, airport (run by Australian army), train line, bus service to Toowoomba and Brisbane.

Basically - the biggest pros for me are: australian army aviation base, proximity to surat basin and maybe future growth due to resource industry, bypasses warego highway, hospital and still not that far away from toowoomba which is in no means a large city with exceptional infrastructure but it has a myer and some quality schools, hospital, etc.

So after a quick real estate search I found the following site - 3.7 acres within town with all services connected for $165,000.

http://www.realestate.com.au/property-residential+land-qld-oakey-2609871

I wonder if this could be an example of a site that could one day be redeveloped into residential with 10+ blocks. Or for an industrial or commercial purpose. It does look to be across the road from a cemetery though!

It would definitely be a gamble but I wonder if you could knock this price down a bit if it could show some nice CG in the short to medium term.

I understand that there would be no holding income with this so I guess its just if someone had some money lying around.

This was just a quick look at it with no further investigation into DD of various things, eg. flooding, bad soils, etc. Just speculating for the sake of it!

YPG

 

[tgarthe]

I'd stay away from Oakey, place is only going backwards in my opinion. Just go for a drive down the main street and you'll see what I mean. The place isn't exactly landlocked either, I think you would be just be taking a punt.

Better off looking around Gowrie Junction area I'd say.

 

[matto_]

Isn't this termed land banking?

Bit hit and miss for mine. A lot of things need to go in your favor in order to make a quid.

It can be done though obviously.

 

[8fold]

I agree with tgarthe, this is also over near the abbatoir which does smell a bit. The successful subdivisions I know of in Oakey are over the other side of town on the Eastern side (either side of 4AK Rd). On the Northern side of 4AK Rd I think one of the doctors is doing a subdivision and I know of others thinking of selling those larger ex farming blocks but they are looking for 7 figures....

 

[Propertunity]

Not opposite a cemetery - anywhere.
Not near the wind-drift from an abbatoir - anywhere.
Not in Oakey. It is a cold, windswept, small country town bypassed by the highway. (my folks used to live there). 20kms may as well be 100kms away as far a Toowoomba ppl are concerned - too far away.

 

[Belbo]

The correct way to do this is as follows -

1. Purchase a highly attractive piece of farmland on the edge of any large town in Qld.

2. Join the Bjelke Petersen National Party (or, if not available, the LNP should do).

3. Get the land re-zoned to residential in return for a large kickback to relevant minister(s) and Party.

4. Sell land for a motza and pay dues accordingly.

5. Rinse and repeat.

6. Declare you will run against Wayne Swan.

 

[Fourex]

You may want to add New Hope Coal Mine to your DD for Oakey.

They acquired a lot of land over Acland and I believe might be the same ones trying to expand up to Oakey which might not give you the best CG if they go right over the top of you.

Also agree with Propertunity with all of the satellite towns on the Darling Downs I would personally avoid Oakey.

Fourex.

 

[strongy1986]

I agree that there are excellent opportunities for this sort of stuff. However these normally go to people because of dumb luck. As an investor it's hard to justify buying a large parcel of land with no income coming from it and having to wait 40 years for something to happen. This ties up capital in something when people would rather have it in their ppor. By nature people will get impatient and sell before the true potential is realised.

The solution is a self managed super fund. I think you can borrow about 75% of value. This way the property is paid off by the 9% super contributions you make every year. Further more capital gains on properties are taxed at 10%. If your young and put it in super now by the time you retire it should be ripe
To sell.
Just need to make sure your super fonts cover repayments and expenses you probably need over 40,000 in their to consider this (value of 150,000). You can always make extra contributions though if your 9% won't cover it. Not sure on lending criteria though

 

[jweg]

Uncle Clive

Good idea... but if you're wanting to do this near Toowoomba, there is only one man to talk to.

Unless he has already 'on-sold' to another developer for $$$$$$$$$ I doubt their is a single parcel of land suited to residential development thet he doesn't already own.

Berghofer. Not Palmer.

 

[Property Meister]

im pretty sure it would be far easier to turn $165k into $3mill through smart investing over 20-30 years, instead of buying a piece of land that will have zero return, + rates, that may have a 10% chance of reaching $3mill or a sub 50% chance of growing by 10% pa

 

[AnnieJen]

You may want to add New Hope Coal Mine to your DD for Oakey.

They acquired a lot of land over Acland and I believe might be the same ones trying to expand up to Oakey which might not give you the best CG if they go right over the top of you.

Also agree with Propertunity with all of the satellite towns on the Darling Downs I would personally avoid Oakey.

Fourex.

Margaret Lomas has a property there...confused: Does that give Oakey any creds?

 

[Brady]

Margaret Lomas has a property there...confused: Does that give Oakey any creds?

She has a property there but has made comment that it is a speculative purchase aswell... but no doubt she has done a fair amount of research before she purchased, i would assume...

 

[jweg]

Red Fish Blue Fish

She has a property there but has made comment that it is a speculative purchase aswell... but no doubt she has done a fair amount of research before she purchased, i would assume...

Just a thought... lots of Small Fish eat really well even though it might be tough times, where as the Big Fish might struggle to make a profit. I know at least one 'middle tier' Developer who is focussing on small residential sub-divisions (1 into 3 or 4 blocks) and the occasional duplex t build and sell.

He reckons its actually more profitable than developing a whole estate at the moment.

If I was buying in Oakey I'd loko for a town block that suits Multi-Res... plenty around the 70K mark.