Lot | P-Price | P-Date | Sell Price | Sell Date | A RoR |
Admiralty Two | |||||
20 | $445,000 | 13/09/04 | $725,000 | 11/05/09 | 11.03% |
25 | $369,000 | 24/02/94 | $850,000 | 11/02/10 | 5.36% |
47 | $700,000 | 29/08/05 | $945,000 | 1/09/09 | 7.77% |
81 | $720,000 | 23/11/07 | $725,000 | 27/03/09 | 0.51% |
94 | $615,000 | 19/12/06 | $730,000 | 7/05/09 | 7.45% |
97 | $340,000 | 20/02/98 | $780,000 | 12/06/09 | 7.61% |
106 | $490,000 | 15/11/04 | $750,000 | 24/06/09 | 9.67% |
107 | $485,000 | 1/02/02 | $990,000 | 15/08/09 | 9.92% |
124 | $615,000 | 13/04/07 | $750,000 | 19/10/09 | 8.20% |
137 | $432,000 | 22/03/97 | $815,000 | 15/07/09 | 5.28% |
Felix | |||||
63 | $415,000 | 20/12/05 | $445,000 | 24/09/09 | 1.87% |
82 | $305,000 | 10/08/01 | $480,000 | 30/12/09 | 5.55% |
137 | $355,000 | 4/06/04 | $494,000 | 14/12/09 | 6.16% |
161 | $214,900 | 16/05/03 | $325,000 | 20/11/09 | 6.55% |
195 | $280,000 | 13/08/01 | $428,000 | 7/09/09 | 5.40% |
256 | $522,000 | 6/08/08 | $530,000 | 3/12/09 | 1.15% |
258 | $248,950 | 30/08/01 | $351,000 | 23/09/09 | 4.35% |
291 | $264,450 | 28/04/04 | $358,000 | 24/02/10 | 5.33% |
302 | $746,000 | 13/09/01 | $500,000 | 23/12/09 | -4.72% |
371 | $630,000 | 4/08/05 | $670,000 | 17/02/10 | 1.36% |
Saturday, May 1, 2010
Annual Rate of Return - Felix and Admiralty Two
Monday, April 19, 2010
SouthPoint at South Bank
"A premium central city location opposite the CBD Southbank is Brisbanes premier recreation and dining precinct, Southpoint is the last available site in Southbank and will provide a total of 86,433 square metres of GFA in a mixed use development of exceptional design standard.
Drawing on the success of the Emporium mixed use development by the same group, Southpoint will take the recipe further because of its exceptional location and the manner in which it will integrate into the area’s rail and bus interchange. This will not only provide amenity and market value for Southpoint’s residents and business tenants but will also stimulate demand for retail because of the high volume of commuter traffic.
Consisting primarily of three towers providing office, residential and genuine 6 star hotel standard accommodation, all with retail below, the striking architecture of Southpoint will make it a visual and commercial landmark in Australia’s fastest growing city."
Extract from Recent Matusik Email
Australian Property Monitors (APM) – a fully owned subsidiary of Fairfax Media – last month published a study which outlined what houses across Queensland (and by suburb) could be worth in three, five and ten years’ time. Needless to say, the projected growth trajectory is almost exponential, rising on average by 11% per annum across Queensland over the next decade. Prices rose by 11.7% each year, across Brisbane for example, during the noughties. Hopefully, APM did more work than just assume that the past will be repeated. But one wonders.
A check on 25 randomly selected Queensland suburbs finds a pretty consistent projected growth pattern, with values expected to rise by 30% in the next three years, then by just 10% between year four and five and then by a whopping 115% between the sixth and tenth year. By 2020, just short of 600 Queensland suburbs are expected to enjoy a median price over $1 million; and 54 areas could be, on average, priced over $2 million. The median Brisbane house price, today, is around $440,000.
What is driving the growth in five years’ time? Why does the growth rate plummet in year four? Surely there is something more than just “demand exceeding supply and strong economic growth, particularly in resources,” as quoted in the accompanying media commentary. Please APM, explain to us your methodology, as it is absent from the published forecasts.
Also puzzling is why Hamilton’s house values are expected to drop 20% over the next three years, whilst neighbouring Ascot’s prices are forecast to rise by 7% over the same period. And why just 7% – isn’t Ascot (and Hamilton for that matter) in a prime spot, with heaps of infrastructure support? Similarly, South Brisbane’s values are to drop by 8% by 2012, but West End’s values will rise by a staggering 33% or $236,000. Ditto for Surfers Paradise, down 36% in three years, versus a projected 20% jump for adjacent Broadbeach. I could go on and on. Please, APM, explain these anomalies as well.
The Gold Coast market, and in particular Surfers Paradise, has been getting a caning of late. According to the latest Queensland government valuations issued in March, ocean-front land has fallen by 30% on the coast, with residential values down 18% in Surfers Paradise since 2007, when land was last valued on the Gold Coast. According to a recent study by the REIQ, median dwelling prices in Surfers Paradise dropped by 30% during 2009.
Now there is no question that the Gold Coast is doing it tougher than the rest, with our data – which is based on cleaned up resales – showing that apartment values fell 9% during 2008 and a further 4% last year. But ocean-front apartment values – in Surfers Paradise at least – and again based on individual resale analysis, actually rose last year. Up by 8.9%!
There are two messages here. Firstly, in order to get a true handle on the residential market it pays dividends to narrow down the sample set and investigate individual resales. Sweeping statements – and especially based on suburb, or worse still, postcode analysis – are nearly always incorrect.
The second message comes in the form of a question. Why does the media (and too many punters, as well) accept these forecasts as if they are gospel? I understand why the Fairfax Media might, but the Murdoch Press? Maybe digging around a bit is too much work for journos these days. A recent study commissioned by crikey.com suggests this is the case, with nearly 55% of the stories published across ten major Australian newspapers late last year being driven by media releases or public relations firms.
So what do I think prices will do over the next decade? In short, my answer is…not as much as they did over the last ten years.
Dwellings are overpriced but not (yet, anyway) oversupplied. The current “boom” is likely to run out of puff within the next twelve months, on the back of rising interest rates and declining affordability. We could “crash and burn” like the US recently did or go through a long, drawn-out adjustment, as happened in the 1990s. The latter means that residential values will be flat until affordability is rebuilt by a combination of gradual increases in household incomes and cyclical declines in interest rates. Given this scenario, growth over 5% per annum would be a strong result.
It’s back to the future, if you ask me.
Source: www.matusik.com.au
Sunday, April 18, 2010
Flat Market in Brisbane
- higher interest rates
- risk of lower numbers of overseas students and tourists visiting Australia (including due to the higher Aussie Dollar)
- The review of the Australian Tax System, due within weeks, which will likely impact the treatment of capital gains for real estate, and probably recommend the removal of negatively gearing of losses from investment properties to offset income tax from income earned from other sources
- difficulties in obtaining investment loans, and the banks requiring a higher deposit for investment property loans
- increased school fees, which impacts the ability of many families wanting to invest in property
- increased body corporate fees and rates, making returns less
- poor performing vacation rentals and low vacation rental returns, often less than 2% net returns
Saturday, April 10, 2010
Mirvac's Park
The public release of Mirvac's Park is taking place today -- the same day that 3 apartments at Mirvac's Tennyson Reach are being auctioned due to failure of the buyers to purchase -- and where the off-the-plan contract price is now above market price.
One bedroom apartments from $495,000
Two bedroom apartments from $675,000
Three bedroom apartments from $975,000
Pavilions from $1.6 million"
See this post for a comparison of these prices with current market pricing. Before buying in Park, I would go to the auction of a 2 bed apartment in Mirvac's Quay West -- which is over 125sqm in size, park and river views, a better location, plus a pool (which Park does not have).
Sunday, April 4, 2010
Talking Up A Dead Market on the Gold Coast
"Like anything in the current economy, when investing in a holiday home, you need to take a softly, softly approach. You need to take your time, look at the fundamentals and make sure that they all add up. With the level of choice out there, it is even more important to select well, remembering profit is most often built into the purchase rather than the future sale."
Saturday, April 3, 2010
Brisbane Up Only Slightly
Brisbane Prices
The economist from Australian Property Monitors, Matthew Bell, a Fairfax Media-owned company, says Brisbane (and Queensland in general) will be one of the better performers of 2010, along with Perth."
Sunday, March 21, 2010
Apartments for Sale in Brisbane
- Saville Southbank - 9th floor, river and city views, 127 sqm in total, listed at $780,000
- Quay West, 10th floor, 126 sqm, park views, just listed in the $700s with Colliers
- Parksland Sherwood, top floor, park and city views, one year old, includes separate study that could be used as third bedroom. 110 sqm in total, listed at $530,000
- Fresh Toowong, one year old, two pools, 134 sqm, listed at $555,000
- Riva Indooroopilly, river views, but only one bathroom, 90 sqm, listed at $535,000
- Ciana Indooroopilly, includes separate study that could be used as third bedroom, huge balcony, over 150sqm, listed at $649,000
- Admiralty One, direct riverfront, level 12, 77 sqm listed at $600,000
- Admiralty One, side river views, listed at $449,000 or $485,000
- Quay West, 10th floor, river and park views, over 70 sqm, listed at $460,000
Promised Infrastructure
Saturday, March 13, 2010
Wave or Montague West End
Keen Walk
Mosaic The Valley
Mirvac's Waterfront - New "Park" release
Mirvac has started its pre-release sales campaign for the Park building at its Waterfront development in Newstead. From the materials I have seen, it will have about 100 apartments. The building is divided into two sections, Park North and Park South. There is a mix of 2 and 3 bed apartments, plus some 1 bedrooms at the back of the buildings. It appears that this building has no gym or pool.
Riverpoint West End
- a "two bed one bath" (67sqm internal, so small!) where the second bedroom is internal with no windows, listed at $580,000.
- a "three bed two bath" (81 sqm internal, which is in my view too small for a 2 bedroom apartment) with views of one of the other buildings, listed at $750,000.
Friday, March 12, 2010
REIQ - December Qtr 2009
Locality | Median Dec Qtr 09 | Change over qtr" | Median 12 months to end of Dec 09 | Change over 1yr" | Change over 5yrs |
BRISBANE (SD) | $381,500 | 4.5% | $362,000 | 2.3% | 42.5% |
BRISBANE CITY (LGA) | $400,000 | 2.7% | $386,500 | 1.0% | 38.0% |
ALBION | N/A | N/A | $395,000 | 6.8% | 59.6% |
BOWEN HILLS | N/A | N/A | $418,250 | -1.6% | 28.7% |
BRISBANE CITY ~ * | $456,000 | 2.0% | $423,500 | -7.9% | 10.6% |
FORTITUDE VALLEY | $421,000 | 8.8% | $402,500 | 7.9% | 33.6% |
GAYTHORNE | $336,250 | -3.7% | $342,000 | 0.0% | 57.2% |
INDOOROOPILLY | $472,500 | 8.6% | $435,000 | 12.4% | 40.3% |
KANGAROO POINT | $497,500 | 5.2% | $450,000 | -2.6% | 23.3% |
NEW FARM ~ | $549,000 | 20.3% | $460,000 | -3.2% | 29.0% |
NEWMARKET | N/A | N/A | $416,000 | 6.4% | 44.7% |
NEWSTEAD * | $545,000 | 2.6% | $530,000 | -1.2% | 43.2% |
SHERWOOD * | $400,000 | -16.0% | $427,700 | N/A | 71.1% |
SOUTH BRISBANE ~ * | $388,750 | -5.2% | $399,250 | -8.2% | 19.5% |
SPRING HILL ~ | $347,500 | -13.1% | $390,000 | 5.8% | 47.2% |
ST LUCIA ~ | $403,000 | -12.4% | $448,750 | -1.4% | 60.8% |
TARINGA | $422,500 | 6.4% | $399,500 | 8.0% | 53.6% |
TOOWONG | $430,650 | 1.3% | $415,000 | 0.4% | 43.1% |
WEST END * | $504,500 | -2.0% | $509,000 | -9.9% | 64.2% |
Apartment Sales Soften - REIQ
Continuing a trend in Queensland’s residential property market, the number of sales of units and townhouses reduced markedly during the tail end of 2009, according to the Real Estate Institute of Queensland (REIQ). The REIQ research report, Queensland Market Monitor (QMM), has found the number of preliminary sales of units and townhouses fell 24 per cent between the September and December quarters last year.
The number of sales under $500,000 was also down 28 per cent over the period.
REIQ managing director Dan Molloy said the drastic reduction in sales – especially in the affordable price range – mirrored the retreat of first home buyers from the market.
“Unit and townhouses are popular with first-time buyers as they provide a less expensive way into the property market, especially in South East Queensland,” he said.
“However, first home buyers have now fallen to lows not seen since the high interest rate environment of mid 2008 which means demand for this segment of the market has lessened.”
The latest Australian Bureau of Statistics housing finance figures show that lending for all Queensland buyers fell dramatically in January to be down some 20 per cent on the year before.
“The recent batch of interest rate rises, even though inflation appears to presently be under control, is obviously having an impact on the Queensland market with sales numbers well below what they were during the global financial crisis last year,” Mr Molloy said.
Across the State, the December quarter median unit and townhouse prices edged upwards as sales in the affordable end of the market softened.
Sunday, March 7, 2010
Views and off-the-plan contracts
Selecting a 2 bed apartment
- How many apartments are in the building in total? If there are more than 200 apartments in the building, my opinion is that the building is too big. This creates many issues. One problem is that if you try to sell or rent your apartment, you will be competing with too many other apartments in the building. And there will be too many people using the shared facilities.
- How many elevators in the building, and what is the ratio of elevators to apartments. Moreover, the higher the building, the more elevators are needed. For some of the better buildings in Brisbane, there are 32 or 38 or 44 apartments per elevator. This is good. So using these ratios, a building with 400 apartments should have 9 to 12 elevators.
- How many apartments per floor? A larger floor plate usually results in a less friendly building and more security issues. I think that 6 apartments per floor is a good number.
- Is there a pool, gym and common room?
- Where is the building located? Avoid main roads and highways.
- Is there an onsite and live-in manager.
- How much money is in the building sinking fund. For a large building, this would typically be more than $500,000 (depending on age and size). A new building has a smaller sinking fund, and should have less problems.
- What is the total internal size? Anything less than 85 sqm internal is too small for a two bedroom. There are good two bedroom apartments in Brisbane where the internal size is over 100 sqm.
- What is the total size, including balcony? This should be at least 95sqm. Here are some typical sizes of good 2 bed apartments in Brisbane that I have looked at recently - 132 sqm, 116 sqm, 128 sqm, 119 sqm. I would avoid any apartment without a balcony. (I saw a new Mirvac apartment on the Gold Coast that was 150 sqm internal, plus a 25 sqm balcony.)
- What is the width of the living room. Ideally, the living room should be at least 4 metres wide. A typical living room is 4m wide x 6m depth.
- A corner or floor-thu apartment will usually have better breezes and more light.
- Do all bedrooms have windows?
- Each bedroom should be at least 3m by 3.2m in size, plus built in wardrobe. Ideally, the main bedroom should have a wall that is at least 4m long.
- What is the external length of the apartment? This determines how much natural light the apartment will have. A good two bedroom apartment will have an 11 metre frontage, or more. (This is typically 4m for the living room, and 2 bedrooms of at least 3m each.) A two bedroom apartment in Admiralty Towers has a 12.3 m frontage on one side, which is great, plus another 7m down the side of the apartment -- a real bonus. I saw a 2 bedroom apartment recently that had only 7.7m frontage -- not enough -- the second bedroom was dark! A corner apartment or floor-thu apartment will have much more external frontage. For example, a corner two bedroom apartment at Parklands Sherwood has a 16.7 m frontage. Keep in mind that 1m makes a big difference here.
- Does the apartment have an internal laundry & store room in the apartment, or is the laundry in a cupboard?
- How many storage and linen and broom cupboards? Some apartments have none!
- Is the floor plan well designed. Not too much wasted space (e.g., hallways). Ideally, I like the bedrooms to be separated.
- What are the views, and could the views be built out?
- What floor? A higher floor is usually better, but not always. In the downtown area, try to be above the 6th floor at least.
- Two bathrooms are better than one bathroom. Some two bed apartments in Brisbane have two ensuites, plus a powder room for guests.
- Is there a both a shower and a bath?
- Does the apartment have a car park allocated to it. An apartment without a carpark is much harder to sell or rent. Sometimes, but rarely, a two bedroom apartment will have two carparks.
- Is there extra storage (for example, in the basement) allocated to the apartment.
- What are the quality of the finishes. See this post.
Saturday, March 6, 2010
Lack of Privacy
Indooroopilly Shopping Centre Expansion
Indooroopilly Shopping Centre is expanding again. It will be a negative impact to apartments on Belgrave Road. But this will probably add value to apartments a little further away, such as on Station Road or Riverview Terrace.
Sunday, February 28, 2010
Meriton's Infinity to Launch Soon
Saturday, February 27, 2010
Pleasanton Apartments
How can you tell if an apartment has quality finishes
Friday, February 26, 2010
Property Risks
Extract from PropertyUpdate
However over the last 9 months or so, some parts of our property market have increased in price by a rate equivalent to well over 20% per annum. That’s boom conditions as far as I am concerned and unsustainable.
This type of property increase normally happens in the boom phase of the cycle when fear, greed and speculation kick in.
Fear drives property booms as home buyers and investors see property prices going up all around them. They are worried that they will miss out on the profits the boom has delivered to others. Many become overconfident, at a time when they probably should be more cautious, and overpay just to get into the property market, pushing up prices to levels that are (in the short term at least) unsustainable.
At this stage of the cycle properties often sell for more than their asking price as eager buyers compete with each other to snap up any property that comes on to the market. Vendors also become greedy, pushing up asking prices and this just feeds the property boom.
Sound familiar? Isn’t this exactly what is happening in some segments of our property markets today? Because if we are already in boom conditions, the next stage to come is the downturn or bust stage of the cycle. I am sure that the market can’t keep rising as spectacularly as it has over the last few months. And if it does the Reserve Bank will bring it to a halt with rising interest rates.
What I do see happening is property values continuing to surge strongly in selected markets for the first half of this year and then growth will slow. I see a few issues on the horizon.
Finance will be a big issue for property investors this year, some will have difficulty getting it and others will have to pay more for it as interest rates rise.
I also see more trouble ahead for the world’s economies. The world’s debt binge is becoming frightening. A number of European economies are starting to unravel and the spotlight is likely to return to America later this year, as it appears to be a long way from working its way through its own economic woes. This means that there is a good chance that the US stock market will fall again and so will ours.
Manning Street Development by Kozmic
Brisbane City Council has approved two major new inner-west developments, including a 20-storey tower at Milton with an environmentally friendly "green roof".
The apartment building on Manning Street, about 200 metres from Milton station, will comprise 126 units, ranging from one to three bedrooms. The plan includes 151 car parks and 158 spaces for bicycles and may become one of the first buildings in Brisbane to house a living rooftop garden.
There were five objections lodged against the proposal, with issues including traffic, lack of contribution to local infrastructure and concerns a 20-storey tower was too big for the local area. However, developers will be asked to contribute $3.1 million in infrastructure charges, some of which will go towards a new CityCat ferry stop in the area.
Irresponsible Development
Kozmic Developments brought us the Ferry Road development, Arriva, which has a great view of semi-industrial sheds. In my opinion, not the nicest development. Now, Kozmic is bringing us two apartment buildings in Manning Street, Milton -- with two houses in between. I really pity the poor home owners - how could the Council allow this!
Sunday, February 21, 2010
Body Corporate Levy Rules to Change
From a SSKB Newsletter:
The share that each owner pays to their body corporate levies may change, yet again, when the government commences new laws about how contribution lot entitlements are calculated.
In a major omission that the changes to body corporate lot entitlements made in 1997 were unfair to many, the Queensland Minister responsible for body corporate law, Peter Lawlor, today announced that the basis for setting lot entitlements will revert to the principles used prior to 1997.
Under the 1997 principle the entitlements must be equal unless it is just and equitable for them to be otherwise. This principle changes under today’s announcement.
For standard format plans contribution entitlements will be based on the unimproved capital value of the land – so it will be similar to land tax and your council rates.
For building format plans (apartment style dwellings) the system will be a combination of factors that the minister describes as “market conditions and property value”. The impact of this will need to be considered once the legislation is finalised.
It appears clear that this new “old system” will apply to new developments. However, it is unknown what will happen to developments that are currently being sold off the plan.
Any body corporate where the lot entitlements have already changed from the pre 1997 system to the 1997 system because an owner made an application to have the entitlements altered are in for some more substantial upheaval as the Minister has stated the new law will see the entitlements revert to the way they were before.
At this stage the announcement lacks detail. It is unclear what happens to developments that were completed under the 1997 system and have used that principle for calculating entitlements instead of the new principles.