Showing posts with label Teneriffe. Show all posts
Showing posts with label Teneriffe. Show all posts

Wednesday, July 25, 2012

Reader's Comment - Is there a boom?

A reader's view:
There seems to be a dramatic marketing shift going on in Brisbane at present in regard to marketing of apartments and units. The advertising has shifted to promoting the merits of “investing in apartments for rental return” rather than marketing to owner-occupiers. It appears the owner-occupier buyers have all dried up, perhaps they are among the 20,000 workers slated by the State Government for redundancies?

Or are potential owner-occupiers waiting for the release onto the market of thousands of houses and flats currently owned by State and Federal Government that are soon to be placed on the market as a result of the Government push for the private sector to provide (former) public housing by offering the tax-deduction carrot being offered to owners who place rental properties into the NRAS scheme?

One only has to attend the Home Show in Brisbane to see this over-night marketing shift or take a cursory glance at this Saturday’s Courier Mail Property insert. The marketing hype seems to have abandoned the (now) non-existent new owner-occupier buyers and switched to promoting the merits of “investing in units or apartments for rental return” since clearly, the notion of capital gain is now just a pipe dream, at least for the next 5-10 years.

Accompanying press releases and advertisements say how successful the developments are (or going to be – many haven’t even started building) and advertise the numerous sales that have already been made to “investors” for fabulous rental returns. Who is buying these apartments is the question.  For example, one in Milton advertises that it has sold $90 million in pre-sales with a vacancy rate of 0.7% and a rental return of 12.4% p.a (Courier Mail Sat 21/7/2012) yet not a sod has been turned on the vacant site. Puzzling indeed.

Others are advertising rental returns of $600-$850 per week around Newstead and Bowen Hills yet a newly completed complex at Bowen Hills, just 2 minutes from the CBD has huge placards visible from the ICB offering rentals at $300 per week. Quite a difference from the advertised rentals of $600-$800 per week available to “investors” less than a kilometre away. Recent data shows around 130 apartments available for lease or sale in the Teneriffe and Newstead area. So while alleged hundreds of units are being “snapped up” by savvy investors cashing in on the “rental boom” (remember the mining boom?) around Brisbane, a number of large unit and/or apartment complexes have been abandoned before they even turned a sod. Puzzling indeed?   Yet the marketers claim buyers are scrambling to line up and buy off the plan? More puzzling.

Saturday, February 18, 2012

A Reader's Response

Here is a note from a reader:

I read with interest your article “Positive sign for Brisbane Property market.”. When an individual or some organisation with an interest in selling real estate starts telling the world (or anyone else that will listen for that matter), that race is on again and property sales are going just short of gangbusters, you can bet they are not.  

The sellers and marketers of real estate need to understand that the market of potential buyers has changed and we are not fools this time round. We’ve all seen someone close by with mortgage stress trying to pay for something they paid an inflated price for in the first place.  And those properties that have now become liabilities as they continue to fall in value. Just go and ask your bank for a loan to buy “off the plan”, you won’t even get an interview. What does that tell you?

About 24 months ago, a New Farm/Valley real estate agent told me he expected 2006 prices by Jan 2012.  Now he’s revised that to saying year 2000 prices and dropping. That’s no gain in 12 years.  A really good investment isn’t it.  

Take a drive around at night to any of the big new apartment complexes now on the market. Either they can’t afford electricity or they are empty, take your pick – the lights are out on half the block or more, every night. To say the rental market is tight  - well I disagree.  Down Teneriffe and Newstead way, the signs are out day and night offering 1, 2 and 3 brm apartments to rent.  There’s no shortage and dozens to choose from.

Your writer may indeed have seven positive signs to offer from a seller perspective.  Let me offer rule Number One in commerce: The smart money is made upfront during the purchase process, not at sale time 30 years later (if one is lucky enough to be able to keep up the payments with interest for all that time and, by sheer luck, the market is up at the time one wishes to sell).  

In simple terms, it’s made upfront buying at below market value. Real estate in Australia is grossly overpriced and regardless of the spin put by real estate marketers, developers the Treasurer et al, let me say to you all, stop wasting your breath, we know the joke.  Money in the bank on-call earning interest with no risk and renting beats buying at inflated prices and a life time of serfdom paying off a mortgage for an overpriced piece of real estate.  When prices fall by at least another 40%, then perhaps a property may be a consideration. Now that’s a more positive outlook.  

Please don’t come back with “investment” property with rental income or negative gearing.  Rents are already at their peak, the ability to pay will set the market, not the owner’s idea of what rent should be.  It doesn’t take too many weeks of no income to ruin an investment.  Rent is insufficient to fund an investment property. I’ve done the sums dozens of times recently. It doesn’t stack up unless you can exclude the ATO’s share of the deal, and that’s not recommended. And let’s not forget CGT later on. Need I continue.  

As mentioned, when prices fall by at least another 40%, then perhaps a property may be a consideration. The smart money unloaded in 2008 and now rent. We’re laughing at the property market now days.

Friday, February 10, 2012

DoubleOne3 by Devine

Devine reports that development approval has been received for a 111 apartment project at Teneriffe, Brisbane. The project, known as DoubleOne3, will be launched to the market in late February 2012.  If you preregister, you will receive a free double expresso!

"There’s only one Teneriffe. And there’s only one DoubleOne 3. When you put the two together you get the double effect of sleek modern living in the midst of historic charm. A dynamic duo indeed.  One bedroom apartments with secure carpark start from $370,000.  Be doubly quick."

Sunday, December 25, 2011

Apartments in Teneriffe, Brisbane


Rents and apartment prices to face some stiff competition in Teneriffe?

The sky-high rentals and apartment sale prices being charged for apartments in Teneriffe may soon face some stiff competition when the several hundred brand new apartments being built by FKP at its new Gasworks complex combined with those already for sale at Mirvac’s Waterfront complex, both at neighbouring Newstead, come on stream.  There are some 600 units and apartments planned for construction in that area.

This may have been the trigger for the formation for the recently formed Teneriffe Apartment Managers Network

A recently released brochure, Renting in Teneriffe, is available around the area and promotes sales and renting of apartments through the on-site apartment managers listed and includes 19 apartment complexes that are let by on-site managers in Teneriffe.  Many of the apartments at Teneriffe are converted Woolstores while others such as Dalgety-Mercantile and Winchcombe-Carson complexes were built around 1994-96. 

Perhaps the Teneriffe apartment complex managers have already concluded that they can expect some fierce competition in terms of property prices and rents towards the end of 2012 when the FKP apartments come on stream, which start at $450,000 just a hundred metres down the road from Teneriffe. 

Woolworths is set to open a supermarket in the FKP complex, and boutique shops are planned along with office space and the 5 hectare Parklands area. It’s going to be interesting to see if rents and property prices hold up in Teneriffe when these complexes come on stream in late 2012 and early 2013.

Monday, November 7, 2011

Disclosure of proposed or planned works

Here is a note from a reader, and it is a good reminder to do as many searches as possible and ask questions of as many people as possible before signing a contract for an apartment.

"Here is Winchcombe Place Apartments at 15 Vernon Terrace in Teneriffe (a.k.a. Newstead).  Underpinning of the building is taking place.  The front stairwells that exit to the street were recently underpinned as they had “parted” from the main building with cracks about 40mm in width appearing between the two. 

These photos show the huge cracks at the rear of the building which is currently being underpinned.  Several units in this complex were on the market prior to the work commencing.  I looked at one at an “open” a few months prior to the work commencing and was unaware this work was to occur.  Glad I didn’t buy one and then find this out.

The agent didn’t tell me anything about it when I inspected  the apartment in March 2011.  I’ve since learned a levy had been struck to pay for the underpinning.  I’m not saying the agent was dishonest, perhaps he did not know, only that I was not told. Perhaps I should have asked about proposed or planned works.  Had I made a successful offer, I would not have been very happy to discover this and the extra levy that records show had already been struck at the time of inspection in March. Buyer beware!"


Saturday, August 27, 2011

Devine's Brisbane City and Teneriffe Plans



Devine reports that it has secured the opportunity to build a 107 apartment project in Teneriffe, launching in the first half of 2012.

Devine also has two pending apartment projects in the Brisbane CBD, one on Albert Street at the corner of Margaret Street (the Camelot site) and another nearby on Margaret Street opposite the synagogue. From Devine's reports, it looks like these two city buildings are a long way off.




Saturday, February 26, 2011

Devine Half Year Results

Extracts from presentation to investors:

  • Strong market response to Hamilton Harbour project with third tower sales progressing well
  • Hamilton Harbour (Towers One & Two) construction advancing well, with construction of third tower targeted for mid-2011 commencement
  • Hamilton Harbour has continued to attract strong sales and enquiry with: - 92% of apartments in the first two stages at unconditional contract status, and 49% of Stage 3 now sold and unconditional
  • Hamilton Harbour Tower One is progressing well with structural cycles completing verticals up to floor 14 and slabs up to floor 12
  • Tower Two is close to entering structural cycles which will see the structure advance noticeably from this point in the coming months
  • First apartments expected to be completed by December 2011
  • New opportunity secured; 107 apartment project in Teneriffe, Brisbane CBD fringe (Commercial Road - 107 apartments (1 and 2 bedroom only), marketing to commence in second half of 2011)
  • New project signals Devine’s ability to apply high density residential capabilities to mid-scale, medium density opportunities