Where NOT to buy

[onesixseros]

None of these are my area of expertise, but I thought you guys would like to know. Stems from an news article. Thoughts?

Brisbane, inner city

Emerald, Qld

Gladstone, Qld

Hunter Region, NSW

Mackay, Qld

Melbourne, inner city

Moranbah, Qld

Newman, WA

Perth, inner city

Port Hedland, WA

http://www.news.com.au/finance/real...re-not-to-invest/story-fncq3era-1227183418424

 

[strongy1986]

None of these are my area of expertise, but I thought you guys would like to know. Stems from an news article. Thoughts?

Brisbane, inner city

Emerald, Qld

Gladstone, Qld

Hunter Region, NSW

Mackay, Qld

Melbourne, inner city

Moranbah, Qld

Newman, WA

Perth, inner city

Port Hedland, WA

http://www.news.com.au/finance/real...re-not-to-invest/story-fncq3era-1227183418424

It's just over supply

Councils just saw the dollars from developers and gave them permission to build more housing than is required. This is especially true for mackay, Gladstone and Emerald which only had a small population to begin with

Moranbah - suffering from coal mine closures. If you had any faith in coal long term then it might prove a good time to buy there , pick up a house for under 200k

Inner city - it's just saying don't buy an apartment. It's a no brainer really, why would you buy something that can be replicated thousands of times. Buy something that is rare - land

Hunter region - coal issues

The funny thing is that all of these spots would of been on Terry's buy list only a couple of years ago. I guess maybe he didn't factor in poor planning and decision making by local councils

 

[onesixseros]

The funny thing is that all of these spots would of been on Terry's buy list only a couple of years ago. I guess maybe he didn't factor in poor planning and decision making by local councils

Perhaps he's trying to decrease value in those areas and secretly wants to buy in them..

 

[Jenko]

Gee that list is pretty obvious, just about anyone could spat that out! I would like to see a list of places that a little more research would be needed. How about predicting future areas that will have decreasing value before it actually happens?

 

[The Y-man]

IMHO, "Melbourne Inner City" is *waaaaaaay* too broad a call.

Melbourne CBD, St Kilda Rd/Queens Rd probably.

Would still look at deals in adjacent suburbs.

The Y-man

 

[albanga]

Great subject! Read a million "where to buy" posts.
Agreed with other posters this is really a no brainer though. Do not buy in places that are over developed! WOW that must have taken an age to come up with that insight.

 

[sumterrence]

Great thread!!!!

I would be pretty keen to know which area in the short term will show a decrease in value due to the over pricing.

My prediction, provided interest rate rises by at least .75 basis point after 6 months, these areas will slump:

Liverpool
Rhodes
St Marys

Why? because 70% of the owners are investors and when all those over leverage people start having difficulties repaying their mortgage due to extremely poor rental return and high vacancy rate, they will start selling, and boom, domino's effect followed by panic selling....

It's not hard to tell because at the moment Rhodes and Liverpool already seeing a struggling rental market.

Don't ask me how that 70% came from, it's purely my assumptions base on my observations

 

[Corey Batt]

According to Residex suburb statistics:

St Marys: 43% investors
Rhodes: 55% investors
Liverpool 50% investors

Higher than the national average, but not quite 70%.

 

[sumterrence]

According to Residex suburb statistics:

St Marys: 43% investors
Rhodes: 55% investors
Liverpool 50% investors

Higher than the national average, but not quite 70%.

Thanks for the correction the extra 20% were added by myself lol

 

[Corey Batt]

Thanks for the correction the extra 20% were added by myself lol

Only a slight variance!

What's interesting is a lot of these areas which have been listed were previous 'hot spots' which people were spruiking heavily. Many had short term fundamentals which went *splat* when all the long term factors washed out any net gains - Moranbah is a key example.

As always when researching your investment purchases, be sure they meet your short, medium and LONG term goals.

 

[TMNT]

typical property 'experts'

have the gaul to call an area a dud which they were spruiking even as 2 years ago

 

[onesixseros]

I'd like to see a list for where not to buy in SA...

news.com.au really do tend to state obvious things though in their "news"

 

[RetireRich101]

.

Don't ask me how that 70% came from, it's purely my assumptions base on my observations

Other 'blue chip' suburbs, according to residex.
Strathfield 2135 36% investor
Chatswood 2067 41% investor
Manly 2095 51% investor

The above suburbs are approx $1.8m median house. The Liverpool and St Marys are 600k and 450k respectively, and these suburbs are getting 5-6% return, whereas the the $1.8m houses are unlikely getting a return of 3%

If all borrowing on same LVR, and an interest rate increase of 0.75 would hurt who?

 

[Corey Batt]

I'd like to see a list for where not to buy in SA...

news.com.au really do tend to state obvious things though in their "news"

Roxby Downs.

 

[Ausprop]

Newman, WA

Perth, inner city

Port Hedland, WA

http://www.news.com.au/finance/real...re-not-to-invest/story-fncq3era-1227183418424

this is a bit of a donkey list if you want to follow herd instinct. I would have thought there were some excellent counter cyclical buys in these places. Perth inner city presumably means apartments - not sure if that was specified or not? again tho, as in any market, find someone that's bleeding and go for it.