Thursday, November 29, 2012

Flood Check

Before buying, it is worth checking the Floodcheck database and map.  See Floodcheck.

Wednesday, November 28, 2012

Mirvac Cancels Foreshore Hamilton

Things can't be that good in the property market in Brisbane.

"Mirvac has confirmed its refunding off the plan deposits for Brisbane and Townsville residential projects.  Construction was scheduled to commence on two key apartment projects this financial year, but given the limited sales and concerns on the off the plan market's immediate future looked, Mirvac's John Carfi confirmed to The Courier Mail that contracts had been cancelled and deposits refunded.

The first stage of Foreshore Hamilton was to be a 23-storey building with 263 apartments. Only three of the apartments had been sold, the paper noted. Prices of one bedroom apartments started from $345,000.

 It was possible within about 18 months that Mirvac would reconsider a fresh start on both projects. Mr Carfi said despite there being strong economic fundamentals evident in Queensland, confidence was at an all-time low.  "With the Queensland market, it is difficult to see what the catalyst is going to be (to improve confidence),'' he said."

 See Property Observer


The following is a note from a reader:

Think you’ve found a nice quiet unit or apartment near the CBD, buyer beware!. I’ve found agents like showing near CBD properties in the quite weekday afternoon or Saturdays. This is because noise is generally at a minimum at those times and more importantly, no garbage trucks. But beware the week-night nightmare – industrial garbage trucks. 

Most  apartment complexes have large industrial type bins these days as opposed to the traditional Council-type gray and green bins. Traditional Council-type gray and green bins are usually collected after onwards. With for example, 30 or more units in a complex, industrial bins will require emptying twice a week. My block has 80 apartments. The garbage trucks come 4 times per week. (Luckily, I had checked this out beforehand and found in advance that our Corporate Body let the contract on the basis they come after The big industrial bins need a big garbage truck and generally, no traffic or strings of parked cars to obstruct entry by these big trucks. These big garbage trucks usually start around mid-night precisely for the above mentioned reason, ease of access. And they make a LOT of NOISE. 

I know many people who have found themselves in this predicament – the garbage collection three times weekly.  I have experienced it myself, woken up every night by the industrial bin collection rampage. I know people who sold up and left apartment blocks in both South Brisbane for exactly that reason. My friends in Milton did the same, sold up and moved because of the nightmare garbage truck four times per week, twice at their block and twice at the neighbouring block. My friends at Teneriffe did the same, sick and tired of “bang crash bang crash” at in the morning.  Hundreds of residents woken up long before the wee small hours, four times EVERY week.  And if your apartment block is near restaurants, expect even worse, hundreds of bottles being dropped into a steel garbage truck bin from the skip raised 3 meters above the truck. I once lived in a apartment block in New Farm. It was a nightmare. Every morning, industrial garbage trucks started banging and crashing as of It went on and on till daybreak as they went around the area servicing all the apartments  and restaurants.  Every day of the week including Saturday. I never slept one single night right through, at that unit. And I had to close the windows to sleep. I was glad to leave for good.     

So, do some homework. Remember, you are about to part with $400-600K, or more. If you are seriously looking at buying a particular unit or apartment, ascertain the location of the industrial bin collection area. Is it right below your bedroom windows? Is it the large industrial type?  Is it accessed by large trucks? Do they arrive between 1.00am and 6.00am? Because if so,  run a mile.  Don’t bother asking the manager, he/she will tell you there is no garbage truck noise because they are well aware of the joke. Do ask to check the Corporate Body records to see if they have arranged day-time garbage collection. Even so, if the neighbouring apartments have not, you are still sunk. So go there yourself in the early hours of the morning with a coffee and a book, sit in your car till day break, Sunday to Saturday and wait it out to see what time the garbage trucks arrive and the noise level they make. Note what happens at what time at the apartments next door and within your area. You will be very well rewarded for just a few hours of your time.

Tuesday, November 27, 2012

Regrets and Traps

What main regret did homebuyers have?
Although the percentage of first homebuyers* who had regrets about their property purchase is fairly low, at 17.7% nationally (but up to 20.1% in Queensland), the main regret (with over 27% nationally) was that they wished they'd bought in a different area. This was followed by: they wish they'd shopped around more for a property; and, they wished they'd waited until they could afford a property that was closer to their ideal property. 
Three 'traps' for first homebuyers
Paul Osborne highlights three other 'traps' that, in his experience, first homebuyers may fall into:
·         Buying a property that is too common and has limited scarcity.
“These include new construction apartments and generic housing estates".
·         Buying too far away from the CBD.
“Buyers often have remorse about getting something bigger – but located further out.  They find they don't really need the extra space but truly value the convenience of being close to the city."
·         Emotional buying.
“Many purchasers who engaged in emotion-filled auctions in 2009 and 2010 find themselves sitting in negative equity.  Some buyers regret how they bid at auction for their property." 

Saturday, November 24, 2012

Matusik's views on apartment bedrooms

You see, we undertake between 40 and 50 Project Definitions every year – this is a service which helps make a new residential project work better – and we have found that in almost every case, one-bedroom apartments show a better gross rental return than larger ones.  This is particularly the case when you include a quality furniture pack.  Now before I get a bunch of emails outlining this and that, keep in mind I am talking about rental return here and not capital gain; although the statistics regarding one-bed resale performance versus larger apartments are pretty good too.
So in short – the smaller the apartment type, in concert with the inclusion of a single car park, the better the gross rental return.  This rule of thumb is even more evident when you add furniture.
See Gross

Friday, November 23, 2012

Agents Touching Up For Sale Photos

An article in a Fairfax publication about agents editing and manipulating photographs in real estate listings.  See Article.  So take care when looking at listings online.  The property may not look as good in real life.  Maybe such agents should be called Unreal Estate Agents?

Sunday, November 18, 2012

Risks of Buying Off The Plan: NY Advice

The Take-It-on-Faith Condo

 Rising demand and a scarcity of new apartments are creating something of a rush on new luxury condominiums, with buyers increasingly signing contracts for spaces even before they are built.

 This article includes advice about buying off-the-plan in New York.

Saturday, November 17, 2012

Recent Apartment Sales in Brisbane CBD

Riparian Tower - Apt 4101 - 9 November for $3.3M after owner purchased it in June 2012 for the same price. [A reader has emailed me to say that this is incorrect.  I obtained this information from the RP Data database.  The 9 November sale information is as reported to RP Data by North South Realty.  The June 2012 sales data is from government records.]

MacArthur Chambers - 229 Queen St - Apt 205 - 1 bedroom - sold for $540,000
Apt 402 - two bedrooms - sold for $725,000

M on Mary - 70 Mary Street - Apt 2302 - 1 bedroom, no car - sold for $341,000

Festival Towers - 108 Albert Street - Apt 4105 - 2 bedrooms - sold for $452,000 (seller had paid $515,000 in 2007 off-the-plan buying from Devine).

Riverplace - 82 Boundary St - Apt 167 - 2 bedrooms - sold for $495,000

River City - 79 Albert Street - Apt 2706 - 2 bedrooms, 1 bathroom - $420,000

Metro's Central Village

Metro Property Development has announced a new project with over 1,000 new apartments.  It is called Central Village and is located at 66 Brunswick Street in the Valley.    This is a busy road.   It is not the greatest location either.  Even through it is called "Central Village", according to Google, it is an 18 minute walk (1.5 km) to the Emporium Hotel (shown in the photos on the website) and 1 km to the main part of the Valley.  Neither of these would be pleasant walks.  You should try the walk before buying!

The first stage, called Cambridge Towers, has 163 apartments over 18 levels, mostly 1 bedroom apartments.

See also Brisbane Times story.

Tuesday, November 13, 2012

Resiprofile - matching buyers and sellers

Here is an interesting website, that aims to cut out the middleman (e.g. real estate agents):  See Resiprofile.  I have many examples of real estate agents not returning my calls or emails when I want to buy.  So I move on.  I wonder if the seller knows how hopeless their real estate agent may be.  It is always good to do a "mystery shopper" experiment on your real estate agent.

Brisbane Transaction Volumes Increase!

As shown in the above chart from RP Data, Brisbane transaction volumes for houses and apartments jumped recently.

But the Brisbane property market is still well below its peak.

There has been negative annual value growth over the past five years for Brisbane property.

And no growth over the past year in Brisbane.

Sunday, November 11, 2012

High Hope for Bowen Hills

There is talk that Bowen Hills will be the next boom area in Brisbane.  I am not sure that I agree.  There is little infrastructure at present, and no sense of community or neighbourhood.  It is a semi industrial area, surrounded by major roads, that is slowly being redeveloped with mostly low quality highrise apartments.  See AFR.  If the pricing was 30% of what developers are asking, then I may be interested, but at present, it seems way overpriced for what is in existence today.  My advice is to wait, and you could be waiting some time.

Aircraft Noise

Aircraft noise in some Brisbane suburbs is a serious concern.  With the new runway being proposed for Brisbane airport, there will be more noise in my suburbs.  It is so much of a concern that REIQ now has a tool to try to ascertain if a property is now or will soon be impacted by flight noise.  From an REIQ press release from Friday:

The Real Estate Institute of Queensland (REIQ) and Brisbane Airport Corporation (BAC) announced a ground-breaking partnership aimed at empowering property buyers and agents through mutual education around current and future flight paths.  The partnership, which is believed to be the first of its kind in Australia, is the result of both organisations’ desire to prevent situations where buyers make an investment without fully understanding current and future flight activity near that property.

Through this partnership, both the REIQ and BAC will use a collaborative approach to promote online tools that outline current flights paths and noise levels, in addition to future flight paths and areas of higher aircraft noise.

BAC CEO and Managing Director Julieanne Alroe said: “We consider REIQ to be an excellent partner and we were delighted they welcomed our invitation to form a partnership for the good of the state and the industry.  With the REIQ’s property website,, going from strength to strength and the Institute being a leader in Queensland, we were impressed by both their reach and their focus on educating the industry.  It’s no secret that buying a property for residential or investment purposes is one of the most intensive and stressful things a person can do. The last thing we want to see is someone going through that process, only to find that they are not aware of a current or future flight path. These are long term decisions and we want people to feel as informed and empowered as possible."

Sunday, November 4, 2012

Juniper's Fire Sale of Retail Assets

The collapse of the Soul development at Surfers Paradise must be really hurting the Juniper empire.  Juniper has listed what appears to be all its retail investments for sale, looking for offers this month.  Looks like a fire sale.  The Sea Temple Gold Club at Port Douglas is also for sale through the same agents, but it is unclear if this is also a sale by Juniper.  Many investors have lost money over the years buying from Juniper.  Now it is Junipers turn.

To buy or not to buy a Queensland Unit?

See here for a transcript of a conversation with property analysts, as to whether it is too risky to buy an apartment in Qld due to the changing strata laws and levy entitlements.

Saturday, November 3, 2012

Brisbane Apartment Median Sale Price Down Slightly

The RP Data-Rismark Home Value index results for October recorded the first month-on-month decline since May 2012, with the eight capital city aggregate index falling by -1.0 per cent over the month. The fall was broad-based, with falls being experienced across each of the capital cities apart from Perth and Darwin. Both Sydney and Brisbane markets recorded a -0.9 per cent fall in values over the month, while Melbourne values experienced a larger -1.1 per cent fall.

On an annual basis, only Sydney (+0.6%), Perth (+3.5%) and Darwin (+8.6%) have shown a rise.

“Whether the October decline is a blip on the path to a recovering market, or a sign of further weakness is yet to be seen. Other indicators are suggesting the market has gathered some strength, with auction clearance rates holding firm around the 60% mark across the two major auction markets and owner occupier housing finance numbers showing steady improvements since February 2012, albeit from a very low base."

While unit markets showed a more resilient performance across the combined eight cities aggregate index, with values down -0.6 per cent in October, compared with a -1.0 per cent decline across the detached housing market, the cities of Melbourne and Adelaide both recorded a larger -3.2 per cent fall in unit values over the month. In particular, Melbourne unit values have shown a greater decline in values than any other mainland capital city over the past twelve months, recording a 6.0 per cent drop.

Brisbane apartment prices (to 31 October 2012):
October 2012 - down 0.3%
Quarter - up 1%
Year to Date - down 2.9%
Year on Year - down 4.4%
Median price based on settled sales of Brisbane apartments over the quarter - $363,000.

Property or Shares?

According to RP Data, on a capital appreciation measure over the past decade, the past half-decade, and over the past three years, residential property has well and truly outperformed shares.  Over the most recent twelve month period shares have outperformed the housing market.  Property has less volatility than shares, but less liquidity.