Friday, December 24, 2010

Capital Growth

In December's Australian Property Investor magazine, there is a chart from Collier's that lists average capital growth and average hold years for certain Brisbane apartments, as at August 2010. The capital growth period and methodology to produce these figures is not disclosed:

Casino Towers - 5.9%, 3.7 years average hold
Aurora - 5.4%, 3.6 years average hold
Felix - 5.25%, 3.8 years average hold
Quay West - 4.9%, 5.1 years average hold
Festival Towers - 2.3%, 3.9 years average hold
M on Mary - 1.1%, 2.9 years average hold
Charlotte Towers, 0.9%, 3.5 years average hold.

My guess is that the hold period is calculated from when the off-the-plan contract is signed, not when settlement takes place.

Off-the-plan investors in Devine's Festival Towers and Charlotte Towers have clearly lost money. A word of warning for investors in Devine's Hamilton Harbour. Devine's Casino Towers has done ok, but that is unlikely to be repeated now that Jupiters is building a massive hotel across from Casino Towers that will block much of this buildings river views (but not the western sun). Out of this group, my pick would be Quay West -- only 132 apartments, with a long hold period and good capital growth, never to be built out views.

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