Right time, right place ? Deception Bay, QLD

Discussion in 'Where to Buy' started by Void, 19th Feb, 2010.

  1. Void

    Void Member

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    Hi everyone,

    I guess I fall under the category of long time SS reader, but rare poster :)

    I am pretty excited as I have already reached my goal for 2010 which was to purchase 2 IPs. After months of reading and evaluating I was lucky to join a mate of mine to travel up to Deception Bay QLD where I had identified a few bargains (at least for my newbie standard).

    E.g. this property (http://www.realestate.com.au/cgi-bi...t=&header=&cc=&c=67674271&s=qld&tm=1266570817) was on the market (and still is) for so long, I was able to negotiate a very good price. While up there I was surprised to see that the inside was a lot larger than expected, but I was finally not convinced its 'strange' shape would help when trying to sell it in the distant future - so I decided not to go ahead with the purchase.
    While up there, I talked to a few other REAs and one of them showed me a new property which just came on the market that day - they didn't even had time to take pictures yet.
    I went through it, liked it and put in an offer which after a bit of negotiating was accepted :)

    I guess this post has 2 purposes - the first one to encourage other SS members who are also in the early stages of building an IP portfolio - to just go out there, look at the researched areas and talk to REA. Sometimes you just might be lucky and you are at the right time at the right place and find a better deal than expected.

    2nd purpose is to see what other SS members think of Deception Bay (and yes, I have searched the forum and found a few entries) but I think the market there has bottomed out and is going up again - quite significantly if one believes RPData. I bought well below the median, close to water, tenanted, it's in reasonable shape, not CF+ but close.

    Comments would be greatly appreciated :)
     
  2. AdrianAppleyard

    AdrianAppleyard Member

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    Deception Bay = Inala by the Sea.

    But in saying that I think it's a wise area to invest. No matter how much a place is full'o'bogans, if it's by the sea it will get good growth.

    Brighton and Sandgate are other sh*tdumps where sooner or later people will buy it up and build brand new quality housing.
     
  3. Pa1nter

    Pa1nter Member

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    Very good buy,I was very surprised when I saw the price ;)

    You cant go wrong there, close enough to the city and close to the sailing :D
     
  4. sash

    sash Member

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    Good buy!;)

    I own one there also.....from my opinion Deception Bay is the best kept secret in the Brisbane suburbs...where else can you buy a property near water for less than 300k.

    I remember Terry Ryder listing it as a ugly duckling. It keeps going stength to strength.

    Having watched what happened to the Redcliffe peninsular it is a matter of time before it really takes off. You can still by unrenovated property for less than 270k.

    From a rental perspective I have found it much easier to rent out than my Margate property.

    My 2 cents worth anyway.....
     
  5. PI141

    PI141 Member

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    I watch Redcliffe and surrounds with much interest - I wonder why the area still has not moved ahead - its really dragging its feet - prices are good and lots of indicators tell me to buy there but something is holding me back. Is it the transport issues - the unemployment in the area ? I just cant put my finger on it but as my plan requires good capital growth over the next few years to build my PF I just don't want to risk it yet. I am sure it will happen though - its a very interesting area.
     
  6. travelbug

    travelbug Member

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    Painter and Sash. From his post it says he didn't buy that property but another one.

    Maybe one of you should buy it.
     
  7. 65fbk

    65fbk Member

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    Ahhh Depression Bay. I almost bought up there about 2 years ago. I might go back for another look.
     
  8. WinstonWolfe

    WinstonWolfe Richard Werner fan

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    = Depression Bay

    IMHO, the fundamentals are stuffed and will remain so for another 30 years.

    A bottom of the rung socioeconomic region can't move up unless something changes significantly in the fundamentals like

    - major new employment centre nearby
    - major retirement locus
    - massive population growth
    - rezoning/ redevelopment (of foreshore. though doubt this will happen because it would get vandalized regularly)

    I grew up in Petrie and know Deception Bay well.

    It's demographic has gone down hill since the 60s.
    There's no plans for major employment.
    It has issues with underskilled and unhealthy groups of Pacific Islanders, southern state migrants, and 2nd and 3rd gen local ferals.
    There's strong competition for fringe north Brisbane jobs from Caboolture, Morayfield, Narangba, Pine Rivers.
    The economy is extremely sensitive to economic downturns.
    THere's lots of new IPs in the region so a tenant with a reasonable job isn't likely to choose the older homes.
    Think about what kind of tenants you are likely to get.

    Any significant growth this place sees will be from population growth and loose credit.

    Apart from that, I have been wrong before.

    edit: If I was in govt, I'd be rezoning the strip 500m-1.5km from the foreshore, as development sites for retirement villages. That would accelerate the change of the demographic, and start attracting better quality people to the 0-500 metre strip. Then a beautification process could begin along the front, which would focus on a pedestrian precinct with minimal through traffic. Police presence would need to be upped for some time though.
     
  9. willair

    willair xx

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    fibro humpy..
    The property in the link is the one you did not buy,the fibro on the small block even the stumps don't look quite right,sometimes agents use properties like this one as a advertiser or springboard they show you something like the fibro property to make you aware of the market
    then they will already have a list and price in mind,and work you up too the where and the 20% of their listings that they know will sell after looking at the first one,,,i know nothing about the area,,i guess my question is what sort of property did you buy ....price size and location not the street and i will look it up and give you my opinion,it's not what price you paided it's what it's going to be worth in 5 years time,because i don't think the next five years are going to be like the last 5:)..good luck willair..
     
  10. beachside

    beachside Member

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    I have had a good chuckle reading the above posts - reconfirming "don't listen to what others say" - particularly those who have made negative comments on Deception Bay and obviously have little knowledge of the area. Some comments remind me of one of the prominent agents in the area who says DBay will never go ahead. He of all people would have access to figures which would confirm the opposite. If everyone owned a house that had achieved an average of 15% growth pa (as far back as stats go for my IP in DBay) they would be laughing. I bought there nearly 3 years back and after a reno I still get over 6% return (based on 100% lend)

    The one thing DBay has taught me is that out of towner's with an open mind and not a preconceived opinion will see a suburb in a different light to the locals who are the slowest to see change and let go of old reputations.

    I live on the Northern Beaches in Sydney but would hapilly live in my IP in DBay 500m from the water (I live 100m from the beach in Sydney). Some people in DBay look a bit rough but are not as bad as people think. I would say the shoppers in Woolies in DBay are about 70% the same as my local Woolies. There is more theft and assaults in my own suburb in sydney than in DBay. I could not believe how quiet DBay was on NYE the previous year.

    Having said all this and knowing how daggy DBay was several years ago I did get a first hand experience of some of these people when staying in a caravan park up there 18 months ago while doing some reno work - tenants in place. The scum that used to live in DBay has moved further afield or to the caravan park up the road. Friendly people generally, but not exactly eastern suburbs type people!!! ;-)
     
  11. WinstonWolfe

    WinstonWolfe Richard Werner fan

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    Void, PM me and I'll give you the names of 2 nearby suburbs with stronger growth history (8% and 25% better), upside, and IRR than Beachside's IP

    And along with Beachside's advice about locals being the last to see what's unfolding under their nose, I'd add beware of investor self interest. Human nature being what it is, once committed to a burb, less sophisticated investors take their attention off what is happening elsewhere and encourage others to buy into the burb to ramp prices and the value of their holdings. DBay's median actually went backwards last year.

    edit: I can also recommend a thorough BA to provide comparative stats and a shortlist with worked IRRs.
     
    Last edited: 20th Feb, 2010
  12. josko

    josko BluePlanet-Green Shackles

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    Hi Void,

    Welcome and good for you.

    My comment below is not to say your choice was incorrect because you have entered the market and you really can't go wrong if you are willing to wait. Property is a long term strategy, as you know. :)


    Hi beachside,

    I find your post quite interesting.

    I followed Redcliffe Peninsula VERY closely for approximately 2 yrs before I had an offer accepted and bought 2 houses in Scarborough.

    What I found disconcerting about Deception Bay is that it reminds me of certain demographically similar areas on the Central Coast. Areas which are continually trying to grow but just never do as well as some other suburbs that hold a more affluent demographic, have better transport, employment and/or schools. It's my belief that schools also attract a certain type of tenant. Not the number, but the reputation.

    With such an isolated area, I feel that it is neccessary to look deeper and find out if there are actual plans for redevelopment or infrastructure.

    Is there new infrastructure in the area? Is there an increase in population? What has Council got in store for Decpetion Bay? A good investment should also have some point of difference that makes it stand out from other investment areas.

    I have also noticed that the price gap between old Scarborough and Deception Bay has widened in the past three years. It is what I thought would happen.

    I am not sure why you would give up the beautiful beaches of Sydney to live next to a bay that you can't surf at and barely swim in. Although Sydney beaches are so packed these days but we are talking about a business decision to invest not a personal decision to reside.

    However, I am glad to hear that you think the riff raff are moving on as generally speaking- as rents rise the affordability factor should drive those on lower incomes further in land. This can only be better for Decpetion Bay in the long run.:)

    Unlike the agent, I feel like any suburb it will grow but it just may take longer than others and have longer periods of stagnant growth.


    Regards JO
     
    Last edited: 20th Feb, 2010
  13. Pa1nter

    Pa1nter Member

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    They call it bait ;)
     
  14. Pa1nter

    Pa1nter Member

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    Apon reading the post again,(Silly me)you are right.
    Alas I cannot buy again for a little while,
    This house just looks odd because it has high ceilings in fibro,
    I;m sure someone can do a little extension on the front to sort that out.:eek:
     
  15. Void

    Void Member

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    Thanks guys - definitely a lot of interesting views !

    @ Travelbug
    You are right, I did not buy the property I copy/pasted the link in - that was only the one I had negotiated a good price for before flying up there.

    @ willair
    I was aware of the 'bait' possibility and the agency did show me other properties which were priced higher (which is not surprising when the ad says 'lowest price in the bay' :)). But I ended up buying through a different agency. I'll PM you the property details.

    @ josko & WinstonWolfe
    Very good points you made. I bought the property to hold, so I am looking at the long-term factors and from what I've seen / researched, I belief things like e.g. the upgrade to the Bruce Hwy will have a positive impact (not just to DBay, but to the whole area). Will it be enough - I don't know :) [I'm definitely not holding my breath for the train line to be built...]
    Of course I looked around in other suburbs on the Redcliffe peninsula, but for the budget I had and the return I need, I was unable to find anything even remotely close to what I ended up buying in DBay.
     
  16. sash

    sash Member

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    Actually they have moved a lot....in 2002 you would have bought in DB for about 90-100k.....now you are buying in at 260k-330k for the older houses.

    The Redcliffe peninsula you would have bought in Margate or Redcliffe for 110-120k .....now you are looking at 310-360k for the older houses.

    A 300% gain in 10 years is not bad.

    As Terry Ryder affordability is a key driver.

    I would be a millionaire if I could count how many times people told me places would not go up.

    I just bought another house today in ugly duckling Woy Woy (Central Coast of Sydney)....no doubt I will have naysayers saying that it won't go up. I bought a 3brm fibro tile for 263.5k. Once I do a paint an carpet I expect to get 320pw. The land value on the rates notice is 265k! The price I paid was 2002 prices......

    There are opportunities everywhere....just some people never see the rough diamonds. Then they wonder where the bargains are......

    Also, the North Lakes Westfield (10 minutes from DB) is expected to double. Basic house and land packages at North Lakes on 350sqm blocks is now above 370k fully finished. The Bruce Highway and the investment in Caboolture is going to beneft DB.

    Give it 5 years....and you will not be able to buy in DB for less than 350k.


     
    Last edited: 20th Feb, 2010
  17. billyb67

    billyb67 Member

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    Not sure what just happened in DB but here are the monthly sales

    Dec-09 $335,000
    Jan-10 $482,500
     
    Last edited: 3rd Mar, 2010
  18. emptyvessel

    emptyvessel Nothing witty to say

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    Old thread, but I figured I would add my perspective.

    I live in D'Bay. Contrarian high-income earner from Sydney eastern suburbs with a missus and (now) 3 kids. When I first checked this place out, I jsut sensed a long and positive future.

    Bought a 1200m2 block of land and built a brand spanking new house on it when Uncle Kev was giving out maximum $21k first home owner grants. House is probably worth close to double the median for the area, so no real CG for me just yet. But then, I always said it was a 20 year play. 2 years in and I am still utterly convinced I am right.

    300m from the water front in a cul-de-sac that sees less than 6 cars come and go each day.

    I honestly moved here thinking we would "rough it" in the "sticks" for a few years until it came good. Turns out, I was very wrong. It is a lovely place with easy access to shops, schools and highway north and south. 40 mins to sunshine coast beaches and 45 minutes to Brisbane CBD.

    Sure, the traffic can be heavy at rush hour, so I don't travel at rush hour. IT can be as bad as some areas of Sydney, but definately not worse.

    Riff Raff? Yes, there is an element of it, but we have been treated with nothing but neighbourly respect since arriving. There are apparently some really crappy areas, but I honestly don't know where they are.

    I get the gym and pool in the morning almost to myself. I get walks down by the bay early. Lots of folks out walking the dog and such. All very friendly.

    Would definately recommend it to other families.

    I purchased here for the future. And the future is bright when you joint he dots together;
    Moreton Bay is one of the largest and fastest growing LGA's in the country.
    Neighbours 1 of the other fastest and largest, Brisbane.
    Affordable for the average masses
    "Squished" between the ever expanding North Lakes and Caboolture regions.
    Train line through nearby Rothwell promised for 150 years is actually making progress. Has been signed off by all three levels of government and the budget allocated. Still doesn't make it a sure thing, but that's the closest it gets in politics. (I think it is a major marginal electorate, this usually bodes well for funding)
    Cheap/available industrial/commercial land in D'Bay, North Lakes, Kallangur and Caboolture
    Masters opened up in Caboolture. Apparently another either open or opening in North Lakes.
    Right on the water. Now the bay isn't sexy like a beach, but it is still a nice piece of lifestyle.
    Close to Bribie and Sunshine Coast for real beach activity. 40 mins to the beach at Bribie and Caloundra.
    Expansion of local Retirement/Lifestyle village. I walk past every day and it seems to be say a 30-40% uplift in the number of villas.
    New townhouse complex nearby just about complete.

    Market has suffered over the past 12-24 months. I haven't seen a drop in my property value as per the banks reckoning. Which is odd really, because we are definately towards the upper end of the price range. If I were to sell now I would lose Kev's $21k grant for sure. But I ain't selling.

    There seems to be opportunities for cheap buys right now followed by a quick renovation with a decent uplift in yield. I would do it, but I know nothing about reno's and my 3 kids / job keep me busy enough as it is. If anyone is interested in a JV, I am definately listening.

    You can buy a house right now, across the road from the water for asking price $410k. So probably sub-400k if you can negotiate.

    I am tempted to buy here again. But my strategy tells me to spread my eggs. But goddamn if I can't see some value out there right now. There is a mountain of property on the market and alot of uneducated sellers. Unfortunately, they will be taken advantage of and some good ivnestors will get great bargains.

    Anyways, that's my rant on an old post. Hope it helps.
     
  19. 1911naomi

    1911naomi Member

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    Thanks

    Thanks for info - i am looking into deception bay - cant believe how many properties on the market. WIll have to go for a drive up that way. Looking at properties in high $200s and low $300s with decent rental income.
     
  20. Edge7

    Edge7 www.edgeseven.com.au

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    I will be looking North of Brisbane when I eventually get around to buying interstate. I think it looks like a good area.

    Is there any beaches closer than 40 mins away from D'Bay?

    And, I saw on the news last week that Burpengary (my understanding is that it is the next suburb north) has been flooded 6 times in the past two years. Has this affected Deception Bay?