Wednesday, April 20, 2011
Home Loan Volumes Down
It is reported that home loan volumes are down. This does not bode well for property prices in the next few months.
Q1 defects
See Courier Mail
THE developer of the Gold Coast's Q1 supertower is being sued over construction defects that allegedly have left the building requiring millions of dollars worth of repairs.
Only six years after its completion, the world's tallest residential building allegedly is riddled with corrosion.
Sunshine Coast Troubles
There was an auction last weekend of a large number apartments in the Crowne Plaza Resort near Caloundra, at Pelican Waters. None sold. See story from AFR:
"Heavy discounts, a year to settle and a $5000 rebate were not enough to entice buyers to a liquidation auction on the Sunshine Coast yesterday. Reed Property Group released the final 36 units in its 2005-built Crowne Plaza Resort & Spa in a Helmsman auction, where all units are offered simultaneously to boost interest.
Despite bids on 30 of the 36 units none was sold, although post auction talks continued later yesterday. Reed Property chief executive Ken Reed said the market was soft. “It’s a buyer’s market. Conditions on the Sunshine Coast are not too different from elsewhere in south-east Queensland,” he said.
An opening bid of $65,000 for an 88 square metre one-bedroom unit was the lowest offer made. One of the 512sq m penthouses attracted a maximum bid of $600,000 after it was listed for $1.58 million. Kings Beach residents Deborah and Jeff Taylor said the event was “a fizzier”. “The marker is so depressed at the moment. Things are selling for prices you wouldn’t believe. There are so many units on the market around here at the moment,” Mrs Taylor said.
The $65 million tower has access to a Greg Norman-designed championship golf course, pools, tennis courts and a gym."
Monday, April 18, 2011
Changes to Lot Entitlements for Some Apartments
After being approved by Queensland Parliament on the 6 April 2011, the Body Corporate and Community Management and Other Legislation Amendment Bill 2010 received Royal Assent on 14 April 2011, meaning that the new legislation is now in force. The new legislation will introduce a number of matters including:
- New principles to be used when determining Contribution and Interest Schedule Lot Entitlements
- A process where owners, who have been affected by a Lot Entitlement change, can submit a motion to the Body Corporate Committee before the 14th April 2014 to revert back to the Lot Entitlement Schedule before the change was made
- Additional requirements for Disclosure Statements and rights of termination
- Introduction of a new "Two Lot Scheme" module to make management of these smaller schemes much less onerous for their owners
Sunday, April 17, 2011
Madison Heights Bowen Hills
Metro Property Development and Pearls are marketing a 29 level high rise off the plan in Bowen Hills. The development is called Madison Heights Bowen Hills.
Metro is a recently formed company by David Devine and Ken Woodley. Both are ex-Devine (a listed company controlled by Leightons). Devine has a reputation for building low end apartment complexes. Pearls is an Indian development company.
The Madison Heights development has 182 studio/one bedroom apartments and 104 two bedroom apartments. This gives a total of 286 apartments. However, there are only 204 car parks. So taking into account visitor car parking, about 100 apartments will not have a car park. The development is in an industrial area, on Campbell Street, opposite the Courier Mail printing site, with good views of the hospital and inner-city bypass. There are no amenities around, so a car is needed.
The apartments are tiny. For example, an example two bedroom apartment is 70 sqm, including a 4 sqm balcony. (It is hard to call 4 sqm a balcony -- that is smaller than a bathroom.) Typically, I would not recommend a two bedroom which is less than 85 sqm internally, and even that is small. A good two bedroom should be at least 90 sqm internally. For comparison, you can buy modern two bedroom apartments that are 110 sqm internal.
And pricing is not cheap. A two bedroom, two bathroom which is 73 sqm internally plus a 4 sqm balcony on a low floor is listed for sale at $548,000. This is outrageous. This is over $7,000 a sqm.
Compare this two bedroom apartment in River City, a Devine building (developed by David Devine and Woodley). It is not a great quality building, and it is a few years old, but there is no reason to think Madison Heights will be any better. It is located on Albert Street in the city -- a much better location. It is 76 sqm internal plus 13 sqm balcony, with views of the Botanic Gardens. It has one car park, and is being sold furnished, for "offers over $450,000". So if it sells at $450,000, that will be $5,056 a sqm.
Take care!
Saturday, April 16, 2011
Milton Park
Extracts from an FKP Press Release:
Brisbane City Council’s plan to turn the old Milton Tennis Centre site into parkland is set to benefit surrounding properties, with The Milton the only major new development now on the horizon, says a leading property researcher.
Michael Matusik, director of Matusik Property Insights, said council’s plans to resume the 3.5 hectare site for suburban parkland would reduce the future supply of new apartments in the suburb by about 670, increasing the ‘scarcity value’ of stock in Milton.
Mr Matusik said, along with the reduction in supply, homes and apartments in Milton would benefit from a three to five per cent price premium generally afforded to properties within a one kilometre radius of major parkland.
“The single most common feature of any metropolitan area’s position as a desirable residential address is trees, and while buyers want to be in close proximity to the city, public transport and amenities, they still want access to green open space.
Mr Matusik said the significant reduction in future supply as a result of the development of the parkland at the old Milton Tennis Centre site would put increased demand on new and existing property in the suburb.
The 30-level The Milton, which is anticipated to begin construction this year, will feature 298 one and two bedroom apartments, most with views of the CBD or Brisbane River, along with a ground floor retail promenade and commercial office space."
My comment: The proposed park is some time off. It is located on the other side of the railway and the other side of Milton Road to that of FKP's development. So I don't think it will have much impact to people's decision to decide to rent or buy on a development near the Milton Railway Station, that has views of the brewery.
Rental Yields
"Demand for rental homes in resource-rich regions of Queensland is continuing to drive up residential rental yields in some mining areas, according to the Real Estate Institute of Queensland (REIQ).
The REIQ residential rental yield report found that over the December quarter 2010, the postcodes of Dysart, Blackwater and Moranbah in Central Queensland recorded gross yields between 14.5 and 8.9 per cent because there remains more demand than supply for rental homes in many of these mining areas.
Across the state, however, the market conditions of the past 12 months has resulted in more sustainable gross rental yields given property prices have generally softened and rents have remained stable.
Australian Bureau of Statistics (ABS) figures show that investor numbers in Queensland increased in February compared to January however numbers remain at historic lows."
For apartments and townhouses:
Recent Auctions
- 2602/108 Albert St (Festival Towers) - 2 bedrooms - one of the better apartments in the building - withdrawn from auction and now listed at "over $500,000"
- 110/540 Queen Street (Willahra Tower) - studio - failed to sell - highest bid was a vendor's bid of $175,000
I have attended a few open houses on recent weekends, for 2 bedroom apartments in the middle ring suburbs, selling at less than $500,000. I was the only person who attended each open house. Not that many buyers around.
Thursday, April 14, 2011
Market Cracks
See this story from Bloomberg:
Apartment prices in the luxury beachside Australian town of Noosa Heads have tumbled by a fifth since 2008 as cracks emerge in a housing market that’s so far escaped the rout seen in the U.S., U.K. and Ireland.
The median apartment price in the tourism and retiree town 150 kilometers (93 miles) north of Brisbane has slumped 21 percent in three years to A$570,000 ($594,000), according to the Real Estate Institute of Queensland. Sales have more than halved across Queensland state’s Sunshine coast, home to “Crocodile Hunter” Steve Irwin’s Australia Zoo, and the Gold Coast, known for its surfing beaches and casinos.
“We have a very overvalued housing market and even a small adverse shock can be magnified by a large adverse impact on property values,” said Gerard Minack, Sydney-based global developed markets strategist at Morgan Stanley (MS), who asserts Australian home prices are as much as 40 percent overvalued. “We’re seeing that now in parts of Queensland.”
The Rental Market in Brisbane
This is an extract from a real estate agent's newsletter who sells inner city apartments:
"Where does that leave the rental market??
Going up, up, up – as many people are forced to wait much longer than they had hoped or expected for rebuilding to commence and renovations to be completed. Almost 8,000 homes were inundated by the January floods, and another 10,000 homes were partially affected. This means that the homes of almost 40,000 people would have been somehow affected!
“The increasing demand (for rental properties) us likely to create upward pressure on rental rates as those displaced persons look for temporary accommodation over the next 6-12 months”, according to recent RPData report on the effects of the floods on the housing market. “The issue is that rental houses will be in short supply and many may have to opt for a unit instead.”
Tuesday, April 12, 2011
Tennyson Prices
It is interesting to see the current pricing for apartments being resold at Tennyson Reach. This is a Mirvac development in the middle of nowhere, and three more buildings are planned.
This complex was badly impacted by the floods. The Mirvac website says:
"Thank you for your enquiry through the Tennyson Reach website. Mirvac does not have any apartments for sale at Tennyson Reach but anticipates that apartments will be made available in the near future. "
They have put their sales program on hold -- they still have many unsold apartments in building three.
Currently, you can buy a prestige riverfront 3 bedroom apartment for $998,000, on the 6th floor. This is about $600,000 less than the original sales price. Beware, body corporate levies are high. The original purchaser would have lost a significant sum of money on this apartment. No guarantee that the next purchaser will not loose too.
Sunday, April 10, 2011
From the USA
"Developers say that renters do not make the same price-per-square-foot calculation as buyers, and that smaller apartments — with some studios less than 500 square feet and larger one-bedrooms barely topping 1,000 square feet — will not discourage the target audience. "
Note that 1000 square feet is 92 sqm. You can't find many one bedrooms in Brisbane at 92 sqm. Brisbane apartments are small, and overpriced.
Trilogy Definitely Not Going Ahead - One less hotel for Brisbane
The Trilogy building, which was to be a mix of apartments, offices and a Mirvac hotel, is officially dead.
Despite reportedly good off-the-plan sales, it is now reported that the current owners of the land are selling to a Melbourne developer who will build an office tower on the site. This may impact some of the views from Aurora?
See Brisbane Times
Recent Sales
Some recent Brisbane apartment sales and auction results:
- Quay West, apartment 1506, 2 bedroom, sold last week, reportedly very close to listing price of $775,000
- Quay West, apartment 1505, 1 bedroom, sold last week, listing price $465,000
- Arbour on Grey, apartment 2302, 2 bedrooms, sold at auction yesterday for $611,000 according to APM
- Parklands Pinnacle, apartment 6017, 3 bedrooms, failed to sell at auction, sold after for $1.3M
Buyers Market
Even the most positive commentators say it is a buyers' market for residential property. And it seems that the Queensland property market is in worse shape than NSW and Victoria. And in Queensland, Port Douglas, Cairns, the Gold Coast and the Sunshine Coasts are in dire straights. I agree with the commentators. Some evidence:
- The Courier Mail makes money from property advertisements and thus tries to have positive stories about the property market and its advertisers (i.e., real estate agents). This Saturday's Courier Mail had no stories about residential real estate at all.
- Real estate agents are returning my calls when I say that I am looking to buy. I even have agents offering to be a buyers agent for me.
- In relation to sales in apartment buildings that I follow, for sales this month, the prices are flat or going backwards (10% to 20% declines in sales prices for comparable apartment property sales, compared with sales prices from six months ago). There are some exceptions to this.
It looks like the Brisbane apartment market is going to go backwards before it goes forward.
Flat
"Today, in the absence of (extra) government stimulus, the number of homes on the market has been steadily increasing again – in fact it’s up 47.5 percent year on year. There are currently 356,600 properties advertised online, and the trend suggests there are more coming onto the market (this week we found out that home loan approvals had its biggest fall in 14 years). ...
Even the most ardent property bulls are suggesting flat growth for the medium term. There’s an old investment adage that says you make your profits when you buy; property investors who buy today may have a long wait ahead of them."
Source: Barefoot Investor
Friday, April 8, 2011
Only Modest Gains
Australia’s housing market is likely to see only “modest” gains in prices as unusually wet weather and floods in Queensland slowed demand and first-home buyers remained on the sidelines, Moody’s Analytics said.
Sunday, April 3, 2011
Rate Your Agent
Here is an interesting website, that allows buyers and sellers to rate the real estate agent. I hope it gathers traction. www.propertyscope.com.au
What happens when property values correct
This is an extract from an RP Data newsletter article, titled "What Happens When Australian Property Values Correct":
...
The proponents of a massive property price crash will potentially point to the Noosa Heads market in Queensland. Much like Sydney, Brisbane and Perth, Noosa Heads in recent years has recorded periods of capital growth well in excess of national averages. Also the market is almost entirely reliant on retirees, ‘sea changers’ and the tourism sector, none of these sectors are currently particularly active. Median house prices in Noosa Heads as at Dec-10 were -16.2% below their peak recorded in Aug-08. The unit market has fared even worse, median prices as at Dec-10 were -24.4% below their Feb-07 peak.
Whether you believe property prices will continue to grow, tank or flat-line, it is clear that you must be cautious when buying into markets which have had periods of surging property values and have yet to see a period of subdued growth or price falls (a correction).
Due to factors such as an ongoing demand/supply imbalances, a strong banking sector, low unemployment and improving economic conditions we don’t anticipate collapsing prices., However it is clear, based on the above examples that growth phases are often followed by a consolidation in values. Over time the combination of inflation, rising wages, rental increases and little or no value growth is likely to result in the property market once again becoming an appealing purchasing prospect. As the examples highlight, in some instances this may take a number of years as wages and rental yields catch up with the surge in home values and confidence in the market gradually returns."
Thursday, March 31, 2011
Admiralty Two and Mosaic management rights for sale
Interestingly, the onsite letting pool consists of 79 out of 191 apartments, or 41% of apartments in the building. This suggests a very high level of owner occupiers in this building, which increases the value of these apartments.
Also for sale in an unrelated transaction are the management rights for Mosaic in the Valley, currently in off-the-plan sales stage. There are 212 apartments in this building, and it is expected that 180 will be in the onsite rental pool, which is 85% of apartments. Buyers beware!
Housing Flat in February - almost no growth over past year
From RP Data Press Release today:
"February's index result (0.0 per cent s.a.) suggests that Aussie home values continue to tread water despite robust household income growth. There was little revision to RP Data-Rismark's January estimates.
After a natural disaster-affected January (-1.5 per cent seasonally-adjusted or -0.7 per cent raw), RP Data-Rismark's Hedonic Index reports that Australian home values held ground during the month of February.
In the capital cities, RP Data-Rismark recorded flat dwelling values (0.0 per cent seasonally-adjusted or a slightly stronger +0.7 per cent in actual 'raw' terms). The 'rest of state' areas, which account for the 40 per cent of homes not located in the capitals, also displayed some improvement during February with house values rising by 0.5 per cent seasonally-adjusted (+0.3 per cent raw).
Over the 12 months to end February, Australia's capital city home values have hardly moved, rising by only 0.8 per cent. The story is the same in the rest of state regions, where home values remain unchanged (-0.2 per cent) over the last year.
In the property investment market, RP Data-Rismark estimate that gross apartment and detached house yields were 4.8 per cent and 4.2 per cent, respectively, in February. Darwin (5.7 per cent), Canberra (5.3 per cent), Sydney (5.1 per cent) and Brisbane (5.1 per cent) all offer reasonable rental yields in the apartment market. Melbourne is the laggard at 4.2 per cent. ...
A (near) double interest rate hike in November 2010 combined with numerous natural disasters has conspired to make the last three months difficult ones for Australia's housing market. ... While the weakness has been evidenced right across the nation, it has been especially acute in Darwin (-9.0 per cent) and the two resource-centric capitals, Brisbane (-3.3 per cent) and Perth (-1.9 per cent).
"Recent RBA analysis also shows that repossessions have been highest in Perth and South East Queensland, which helps explain the poor performance seen in these states. Indeed, Perth home values remain 0.7 per cent below their December 2007 levels", Mr Kusher added.
Over the 12 months to February, Sydney (+3.3. per cent), Melbourne (+2.5 per cent), Canberra (+0.7 per cent) and Adelaide (+0.6 per cent) have ground out modest capital gains. In contrast, Brisbane (-5.3 per cent) and Perth (-4.1 per cent) have experienced more material corrections. ...
According to RP Data's Mr Kusher, the key leading indicators indicate that capital growth is likely to remain very subdued for the time being, as Rismark and RP Data have previously forecast.
"Auction clearance rates have been a little weak, the number of homes advertised for sale is at the highest level it has been since we started collecting this data, and other lead indicators, such as the time it takes to sell a home, and the margin by which vendors have to discount their properties, are climbing again after reaching a plateau in recent months. Conditions are certainly in the favour of prospective investors. The large stock of homes available for sale should afford potential buyers increasing scope to negotiate on price and get the best possible deal," Mr Kusher said.
Tuesday, March 29, 2011
Yield
"Industry experts estimate a yield of at least 5 per cent is needed to attract investors into the market, though at this level it is unlikely to generate a positive cash flow.
Advertisement:\ Story continues below
Given the past performance and recent volatility of the rental market, which has occurred despite low vacancy rates, investors should be factoring both negative and positive rental-growth scenarios when making purchasing decisions.
Prospective off-the-plan buyers should also consider what kind of apartment stock and how much is planned in their immediate area, which could affect demand and rental levels by the time their unit is put on the market."
From Domain
Sunday, March 27, 2011
How Many Apartments for Sale in Brisbane?
There has been some press recently about the number of apartments for sale in Queensland, and the slow sales rate. This may be the case for the Gold Coast, and for overpriced off-the-plan developments. But if you look at the quality buildings in Brisbane, there are very few apartments for sale.
For example:
- Quay West: 4 apartments for sale (two 2 beds; two 1 beds).
- Admiralty Quays: two 2 beds
- Admiralty Towers: one 2 bed at rear
- Admiralty Two: one 2 bed; one three bed
- Arbour on Grey: 2 apartments for sale (one 2 bed; one 3 bed).
- Saville SouthBank: zero
Across these buildings, that is less than 2% of the total apartments in these buildings for sale.
Some buildings have a large number of apartments for sale: Skyline, Aurora, Macrossan, & Riparian all have a number of apartments for sale. Strangely, The Grosvenor, which usually has no apartments for sale, has about 3 for sale at present.
So there may be an oversupply in some areas and for some buildings, but for the quality buildings, there are not that many available to purchase, particularly below the $900,000 price point. And the flooding of Brisbane does not appear to have impacted pricing of these apartments at all.
Wednesday, March 23, 2011
Soul Settlements Coming Up
Soul off-the-plan purchasers in the low rise section are getting ready for settlement. Soul is located at Surfers Paradise, in a prime location. It is a very high end high rise. Photo from March showing progress.
Valuers and banks for purchasers are looking at contracts and doing valuations. I have heard of a situation where the apartment was valued at 70% of the contract price. That may not seem to bad, but if the contact price is $2M, then the purchaser needs to find an extra $600,000 to settle.
And there has been no announcement of who will manage this complex.
Will Juniper survive, or head the same way as Raptis and Niecon?
One purchaser is trying to resell his 2 bed apartment for more than a 3 bed apartment is being valued at: www.soul-apartment.com/
Tuesday, March 22, 2011
Developments at Portside
The photo shows development sites by Devine, Citimark, Mirvac and Brookfield Multiplex. (Double click on photo for larger view.) An endless supply of apartments, which means values are unlikely to rise significantly.
Properties Advertised For Sale
From an RP Data newsletter, relating to Australian property advertised as for sale:
"The number of new properties advertised for sale increased by 2.8% last week. The number of newly advertised properties for sale is currently 20.5% above the 12 month average and 23.3% higher than it was at the same time last year. The total number of properties advertised for sale increased by 1.7% last week. Total advertisements are 13.1% higher than the 12 month average and are 23.6% higher than at the same time last year. With so many properties available for sale and few active buyers, vendors are going to have to offer competitive pricing if they wish to sell."
See Chart, that shows $41 billion of property for sale in Queensland. There are more properties listed for sale in Qld than in any other State.
Takeover Bid For Oaks
Oaks Hotels and Resorts has received a takeover bid from a Thai company, at 35 cents per share. This compares with the peak price of $2.40 a share. Boy, some investors have lost more money buying Oaks shares than people lost buying apartments that are managed by Oaks. Is it possible for the purchaser to clean up the mess? Oaks is a company that owns management rights, and even though has "hotel" in its name, does not really operate hotels.
Rough Ride For Property
"Falling sales volumes and higher stock levels suggest prospective buyers can hold off on making decisions, and are doing so. They're being more choosy, and using the change in circumstances to drive a harder bargain on price.
At the other end of the auctioneer's hammer, stubborn vendors are reluctant to reduce prices."
See Domain
Saturday, March 19, 2011
Tennyson Reach - Legal Decisions
Mirvac and about 15 buyers have gone to court regarding Tennyson Reach, in a number of cases. For the most part, Mirvac has been successful in enforcing off-the-plan contracts against buyers. Here are some extracts from some of the decisions.
"As already noted, Mr Cox values the apartment at $1,500,000 and said that its value would have been $1,750,000 had the view been the equivalent of that from the display centre. " Mirvac v. Holland
"The defendant [Mirvac] is in possession of the apartment. After the flood, it removed the mud. The walls of the apartment consisted of Gyprock sheeting. The defendant removed the lower level of the Gyprock, which was flood affected. Wiring was disconnected; switches were removed and piled into a heap; appliances were disconnected. Dunworth v. Mirvac
"It is that the area of a part of the actual Lot varies by more than five per cent from the area depicted upon the drawing for that part. In this case the area of each of the balconies varies from what was shown within the original drawing by, in one case, 10.35 per cent and in the other by 15.30 per cent. Because clause 6.3(a) of the proposed (and actual) contract permitted a change up to five per cent to the “size of the Lot or any part of the Lot” it is argued that these changes made the actual Lot different from the proposed Lot as originally identified." Mirvac v. Beioley
Q1 Legal Decision - Purchaser Looses Large Deposit
"Losing a deposit on a property is tough, but when it's almost a million dollars a whole new world of pain can be felt." See Brisbane Times
Top End Brisbane Apartments
Here is a story about Scott Street Apartments and Aquila New Farm in The Australian. They do not seem to be selling fast.
Tuesday, March 15, 2011
Another Dog Decision
"The standard is one of reasonableness of course. Any dog will bark now and then."
Another decision allowing dogs in apartments and invalidating a by-law. See Vantage.
Riverpoint Flood Clean Up
"The building was inundated on 11th January 2011, taking out all the plant and equipment in the basement, and power to the building was cut. The pumps were inoperable and all motors were damaged. The body corporate has submitted a claim to its insurers but is not sure when or if it will be met.
The body corporate has prepared a damage report and a preliminary estimate of costs for the clean-up, hire of plant and equipment, purchases involved in the clean-up, temporary electrical power and supply, pump equipment, rubbish disposal, repairs to the electricity supply and switchboards, repairs to ducting and air-conditioning, replacement of pumps and sensors, repairs to sewer and stormwater pumps, repairs to 8 lifts and replacement of lift equipment, pool pumps, entry roller door, fire doors, painting and “miscellaneous.”
The total estimate is $551,341.35 including supervision and co-ordination of the repairs, exclusive of GST."
See decision regarding Riverpoint at West End.
Tennyson Reach Clean Up
At least four million dollars for flood clean up. See this decision.
"On 20 January 2011, Mirvac stated it will not charge any margin or for its time in relation to the rectification works. Its estimate includes prospective costs of up to $1,000,000 for priority works (completion of clean up works currently underway, preliminary electrical works to enable restoration of power and preliminary fire control equipment), and costs of $2,950,000 (including priority works) to complete clean up works, to rectify damage to ground floor lobbies, lifts and the completion of works including electrical, fire and hydraulic works."
Oaks Dives
On Friday, the CEO of the Oaks Hotel and Resorts Group, Brett Pointon, was terminated. No reason was given. On Monday, the Oaks shares dropped 4.5%.
See Courier Mail. The Oaks Press Release says only this: "Oaks Hotels and Resorts Limited (Oaks) announces that Mr Brett Pointon’s employment contract as Chief Executive Officer of Oaks has been terminated effective immediately."
"The principles and ethics that firmly ground The Oaks Group were laid down by CEO Brett Pointon over many years of personal experience in strata-titled property management. The group’s impressive increase in its portfolio of properties under management since its foundation in the early 1990’s is thus anchored to astute knowledge of this unique industry. Known for his pro-active, hands on approach, Brett Pointon leads by example, creating an environment in which innovation in marketing is balanced by the utilisation of proven strategic planning systems."
What is going on at Oaks?
Sunday, March 13, 2011
Noosa
Story from this weekend's Courier Mail: Noosa Mansions Going Cheap
Extract: "AS FAR as top-end real estate goes, these are rich pickings - Noosa's property market is brimming with luxury bargains due to an oversupply of stock and undersupply of buyers.
As pressure mounts on sellers some under siege from banks prices of homes in the iconic playground for the rich and famous have dropped.
Prominent agent Tom Offermann said that for "those with confidence" this was a defining moment. "You can buy well and reap the rewards," he said. "Stock is up 20 per cent on normal levels, buyers are down about 30 per cent and there's good value."
Mr Offermann said the reason behind the downward shift was that Noosa had a high concentration of "discretionary properties" holiday and investment homes that people looked to dispose of in uncertain times. However, he said the area coped better than other hotspots and would bounce back faster.
Mr Offermann's agency recently sold a duplex apartment at 2/11 Mitti St, Little Cove, for $2.015 million for sellers who had acquired it in 2006 for $2.43 million a reduction of 17 per cent.
A stunning waterfront unit in Las Rias on Noosa Sound is listed at $1.95 million 22 per cent below the 2008 value of $2.5 million."
Saturday, March 12, 2011
New Developments Blog
The New Developments blog gives you an idea of how many apartment projects are in the pipeline. Hard to say that there is a housing shortage in Brisbane with this many apartments soon to be built.
Mirvac at Portside
This development will add further density to the area, and kills the rear views for the Promenade Apartments from Multiplex.
Gold Coast Sinking Under Apartments Glut
The front page of the AFR on Wednesday, 9 March 2011:
"Gold Coast Sinking in Units Glut"
Summary:
- 2000 apartments worth an estimated $2 billion listed for sale
- few buyers
- dire oversupply
- only 300 apartments are selling on average each year
- between 5 and 7 year supply of apartments
- high asking prices and a reluctance by banks to lend had compounded the oversupply problem
- NAB less likely to lend to the Gold Coast apartment market
- Mr Korda, receiver for The Oracle, estimates average apartment price for the past 10 years has been about $400,000, while the average price for an Oracle unit is $1.2M.
- Soul will add to the glut, where the average asking price for the top third of the 77 storey building is $3.87 million.
- "If you have a $1 million apartment, you could probably only get bank finance for $360,000" Mr Korda said.
- Its a price point and liquidity issue.
Friday, March 11, 2011
REIQ Sales Report
| Region | Median Sale Q4.10 | Qtrly change | Median Sale 12mths Q4.10 | Median Sale 12mths Q4.09 | 1yr change |
| BNE (SD) | $380,000 | 1.3% | $379,950 | $362,000 | 5.0% |
| BNE (LGA) | $400,500 | -1.8% | $407,000 | $386,500 | 5.3% |
| AUCHENFL | $447,500 | 4.1% | $430,000 | $430,000 | 0.0% |
| BNE CITY | $485,000 | -4.9% | $460,000 | $423,500 | 8.6% |
| CHERMSIDE | $415,000 | 8.1% | $426,250 | $407,500 | 4.6% |
| The VALLEY | $375,500 | -4.9% | $400,000 | $402,500 | -0.6% |
| INDO | $460,000 | 2.4% | $465,000 | $435,000 | 6.9% |
| KANGAROO PT | $408,000 | -25.8% | $505,000 | $450,000 | 12.2% |
| NEW FARM | $531,500 | 4.2% | $525,000 | $460,000 | 14.1% |
| PADDO | $407,500 | N/A | $420,000 | $444,000 | -5.4% |
| Sth BNE | $472,500 | 2.3% | $445,000 | $399,250 | 11.5% |
| SPRING HILL | $391,063 | 10.9% | $390,000 | $390,000 | 0.0% |
| ST LUCIA | $447,065 | 5.2% | $440,000 | $448,750 | -1.9% |
| TARINGA | $427,500 | -2.8% | $426,750 | $399,500 | 6.8% |
| TOOWONG | $407,000 | -4.3% | $435,500 | $415,000 | 4.9% |
| WEST END | $520,000 | -3.0% | $530,000 | $509,000 | 4.1% |
Construction Costs
Quantity Surveyors, BMT, have published a construction cost table.
For a medium quality Brisbane highrise, the construction costs are about $2000 a sqm metre.
Fairfax Says, Don't Trust Real Estate Agents
Fairfax, which earns a large part of its revenue from real estate agents advertising on Domain and in the SMH and The Age, warns not to trust real estate agents.
"Don't take the word of an agent about what your property is worth. Make up your own mind through research or, if you're still unsure, pay to have a professional valuation carried out on your property. That will cost you between $400 and $600."
Subscribe to:
Posts (Atom)
Posts
