When to buy in Brisbane? (now? / wait?)

[mixedup]

perhaps no-one really knows the answer, but I'm keen to hear what other people's thoughts are here that have been in the game longer than me...

QUESTION: In terms of purchase of a rental property via getting a loan (where you borrow money to purchase the property, and then to some extent rely on getting growth of over 3-4% to break even), WHEN would be the time to get serious about purchasing in BRISBANE? (e.g. now / 3 months / 6 months / monitor and wait until you see XXX & YYY occurring)

Or in other words I'm wondering whether I should wait until there are signs of things picking up more before I start getting serious (e.g. picking a couple of suburbs and starting to hit the streets on weekends looking)? Although one worry I have about waiting until things start picking up is how can I make sure I see when this occurs to make sure I don't any further growth spurt.

 

[Propertunity]

QUESTION: In terms of purchase of a rental property via getting a loan (where you borrow money to purchase the property, and then to some extent rely on getting growth of over 3-4% to break even),

Yes, we're familiar with the concept

WHEN would be the time to get serious about purchasing in BRISBANE?

When YOU are ready. ie. Finance pre-approval in place, deposit ready, short-list of suburbs narrowed down, you have done enough research that you know when a bargain pops up etc.

You can do well in any market if you buy well-located property at the right price.

Or in other words I'm wondering whether I should wait until there are signs of things picking up more before I start getting serious

One of the problems with real estate is the lag (up to 3 months) in reporting. This is different from the sharemarket which is virtually instant. You can see what price a share opened at and closed at within minutes.

If you wait for the RE CG chart to show a rise, and then wait for the rise to be confirmed as a trend, then you may well have missed 6 months worth of CG. For example, if you'd tried that in the Inner West of Sydney starting in the last Qtr of 2009 and then into the first Qtr of 2010, then you would have missed out on 20% CG in just 6 months in some suburbs

Just because Brisbane has been languishing for a few years and has now taken a bit of a hit with the floods, does not mean you cannot pick up a good deal if you know what to look for. (Neither does ot mean that if you buy any old property, in any old location, that you are going to make 20% this year either )

 

[hobo-jo]

Brisbane prices fell YOY in 2010, it's true that reporting often lags what is happening, however you wouldn't want to try and catch a falling knife either.

We are yet to see how badly the recent floods, cyclone and general economic downturn is going to affect property prices in Brisbane.

There is no rush in my opinion.

Just because you can purchase a property under market value (relative to others in a suburb) doesn't necessarily mean you should.

With rates where they are and negative growth new investors who borrow at a high LVR to buy are being hit with negative capital growth AND are having to pay money every week for the priviledge. Doesn't sound like "investing" to me.

 

[Ridin-High]

I wouldn't say it is a bad time. I certainly was looking at it myself recently with assistance from a local buyers agent.

But was unable to obtain finance on the terms i wanted and after refining my stratergy abit decided to take a different path.


Their should be alot of money sloshing around in QLD in the next few years which might have an impact on property prices.

1.) Money being transferred from insurance companys to workers/trades people and then into the local ecomony) (rebuilding via insurance claims, this is on a large scale due to damage from natural disasters... so the workers get the $$$, the workers spend on whatever, then those businesses employ more people)

2.) money from resouce projects - I think it's Santos in partnership with some other energy related companys doing a big LNG project up their.


Just remember property is a long term investment (7yrs +)..

Good to purchase while doom and gloom is present, can use that in your negoations to get a good price.

 

[Andrew_A]

A graph of Brisbane prices since 2006, current to January 2011, the flat period for housing prices is now entering it's fourth year being around the January 2008 levels.

Timing is a difficult game with property. Great in theory but when forced to specify a model to test.. good luck! Sell when, Buy when? I last sold just before the GFC with the opinion that it was a very good time to sell, but taking into consideration transaction costs at no point in the last few years would I have been able to buy back that property and make a profit on the trade.

Yields are beginning to push up I'm noticing, not quite as good as capital growth but some consolation.