Will Brisbane outperform Sydney over the next 12 months?

Discussion in 'Property Investment - Other' started by Richard Feynman, 30th May, 2015.

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Will Brisbane dwelling values outperform Sydney over the next 12 months?

Poll closed 29th Jun, 2015.
  1. Yes.

    21.1%
  2. No.

    50.4%
  3. Tie.

    6.5%
  4. I don't know.

    22.0%
  1. INVSTOR

    INVSTOR O+

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    I think you'd be crazy to buy in Sydney right now.
    I would be looking at Brisbane now in suburbs that haven't had huge growth already.
    Who wants to buy when you have heaps of competition?
     
  2. JohnHenry

    JohnHenry Mister

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    Which suburbs near the CBD in Brisbane that you suggest ?

    Because so far I can see that most of the OTP apartment is located within 5 Km of the Brissy CBD ring.
     
  3. JohnHenry

    JohnHenry Mister

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    But yes, you are right.
    But instead I bought an apartment in Strathfield for a bit higher than the Coomera house ($450k 2 bedroom unit).

    I guess, the spruiker doesn't really care about the growth in NSW back then (2011).
     
  4. Shadow

    Shadow Evil Specufestor

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    This sounds about right, give or take 6-12 months. I think Brisbane will be next to boom after Sydney, and then Perth kicks off another year after Brisbane. My plan is to offload a couple of Sydney IPs sometime around 2017 and then buy into Perth around 2018. I think once this Sydney boom ends, Sydney will be going nowhere in real terms for a decade, so it makes more sense to move capital elsewhere.
     
  5. JohnHenry

    JohnHenry Mister

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    Certain part in Sydney is still growing Yes or No ?

    Hi mate, are you sure about that cycle ?

    what about the new location in Sydney that will be opened or already in the process of gentrification such as Edmondsons Park, Schofields, Parramatta and Glenfield, they surely can be another million dollar suburb once Badgery Creek is opened with WestConnex roads completed.
     
  6. C-mac

    C-mac Member

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    ^^ what about exit/entry costs in terms of offloading Sydney IP's to stock up on say Perth? The equity release would need to be pretty massive to offset those sydney exit and Perth entry costs (agent commission, cgt, then stamp duty when entering Perth).

    Property is pretty illiquid in that regard. Unless you are developing or subdividing, the prohibitive admin costs would make it hard to move portfolios around so easily.
     
  7. Rixter

    Rixter $uper Investor (Retired)

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    That's my thoughts exactly. I prefer to borrow against Sydney to purchase Perth and not trigger any of those in or out costs including cgt and increase the asset base at the same time.

    Ultimately it depends one's chosen investment strategy.
     
  8. jerrybee

    jerrybee Member

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    Also for those at the limit, you may find that with the new serviceability rules, you may not be able to "redeploy" that money. The last thing you would want to do is sell, then find out you can't buy another, even if it's cheaper than the one you just sold. That would be a disaster.
     
  9. Shadow

    Shadow Evil Specufestor

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    By 2017 I would have held those IPs for over a decade and they would have more than doubled in value, so there would be quite a lot of equity to release. I just don't see the point in continuing to hold them for another decade in a flat market when selling would give me the ability to leverage into a larger portfolio in a growing market elsewhere.

    Plus I also think they will fall in value after 2018 if I kept holding them in Sydney, which would limit my ability to borrow against them to buy elsewhere. The fall in value that I'm expecting at the end of this boom would be larger than the cost of agent commission and CGT.
     
  10. Shadow

    Shadow Evil Specufestor

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    Perth prices are about half of Sydney prices (Perth median house price is $530K vs $946K in Sydney), and the difference will be even greater when this Sydney boom peaks, so selling two or three houses in Sydney and buying three or four equivalent 'half the price' houses in Perth with the proceeds should be easy enough.
     
  11. see_change

    see_change Apprentice Timing Lord

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    This is a good point to consider and something I thought about , but doesn't appear to impact us .

    We did go through the process of selling properties in the end of the last cycle so when the GFC hit , we could but using funds from our LOC's and that enabled us to move quickly , make low offers that weren't conditional on finance .

    If we'd kept all of our previous properties , I don't know whether we could have done that , and if we had , we probably would have been concerned about our risk at that time of uncertainty , and would have considered it a time to keep our heads down rather than a time for opportunity .

    Cliff
     
  12. willair

    willair xx

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    I was sitting behind a large family at the afternoon movies yesterday and they have just sold a few months back in western Sydney for over 700k,they moved up QLD a bought a 4 bed pool in the sunnybank about a month ago,so that trend is starting to happen,just means more labor voters..
     
  13. see_change

    see_change Apprentice Timing Lord

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    A patient of mine from the northern beaches , is selling and going north . Retired so he's not concerned about jobs , but he might help create some .

    Cliff
     
  14. Azazel

    Azazel Member

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  15. JDP1

    JDP1 Member

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    That maybe true.
    My issue with perth is that the depth of contributions made by non mining is just too low. It's going to take perth ages to develop significant non mining industries. Sydney and Melbourne are already there. Brisbane is trying to get there and is closer to that goal than perth is.
     
  16. Benvolio

    Benvolio Member

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    What about if its a PPOR? Do you think people should hold off?

    Im kind of in that boat atm. not sure if should jump into a PPOR now or buy a few more IPs
     
  17. Azazel

    Azazel Member

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    What do you see Brisbane trying to do that Perth isn't?
     
  18. JDP1

    JDP1 Member

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    It's a combination of what it's done in the past and what it's currently doing.
    Things in past include biomedical research and institutes, etc...the so called smart state strategy. Quite a few are market leading.
    Current = infrastructure, tourism devt with portside wharf, casino with the crown/echo developments etc, the develop ment of tradecoast and direction to attract logistics, and not to mention a fair amount of new commercial buildings and thus tenants currently in progress of being built... Don't see perth have that scale nor aggressive intent.
     
  19. JDP1

    JDP1 Member

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    The very last point in my post is the real kicker. The past is the past...it's really about future intent. Perth is happy to compete with the likes of brisbane and Adelaide whereas brisbane wants to compete with the likes of Melbourne. See the difference in intent.
     
  20. jerrybee

    jerrybee Member

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    Hum. All makes sense, seems like a good analysis. Although I question your objectivity since you're from QLD!