Talking Up the Top End

"Publicly listed property company Mirvac has also started the decade on a positive note, selling $30 million worth of $1 million-plus apartments around Queensland in the first three months.

Mr Johnston said the exclusive riverfront development at Tennyson Reach had exceeded everyone’s expectations in the current market. "The fact it’s sold so well in a market affected by the GFC is testament to the quality of the product and the prime location," he said.

The Tennyson Reach sales ranged up to $2.845 million for luxury apartments on the riverfront, located close to the new Tennyson Tennis Centre. Mr Johnson said that apart from families with old money, 2010 had seen the return of the investor – and they’re not all mum and dad investors with $600,000 to spend on a three-bed, one-bath inner-city renter.

An increasing number of multi-million dollar sales have been to investors, such as one riverfront apartment Mr Johnston sold for nearly $3 million last month. The investor is planning on renting the apartment out.

Ms Havig said foreign investors and expats were also present in the prestige market.
"They feel that the market is still going to rise considerably and want to get in before it does," she said."

See Brisbane Times for full story.

Tax Reform and Property

The Henry Tax Review was released at 2.30pm today. It was expected to have an impact on property investment, but it appears that the impact will be minimal in the short term. See Summary of Report and Mr Swan's response: www.futuretax.gov.au

From the Report:

• Over a long transition period, a land tax should be introduced on all land on a more efficient and uniform basis linked to unit land values, removing disincentives for institutional investment in rental property and integrated over time with property rate assessments.
• Over a similar period, transfer taxes on property should be reduced, and ultimately removed, with revenues replaced by efficient taxes, preferably annual land tax.
• Subject to transitional provisions, and following action to improve the current shortfall in housing supply, a more neutral personal income tax treatment of private residential rental investment should be introduced, with less volatile market effects, through a 40 per cent discount on all net residential rental income and losses, and capital gains.

The structure of land taxes could be improved by broadening the land tax base to eventually include all land. Land tax rates should be based on the value of a given property, so that the tax does not discriminate between different owners or uses of land. A tax-free threshold based on the per-square-metre value of the land could be set such that there would be no tax liability on most agricultural and other low-value land. Higher-value land could be taxed at differentiated rates based on the per-square-metre value of the land.

Stamp duties on conveyances are inconsistent with the needs of a modern tax system. While a significant source of State tax revenue, they are volatile and highly inefficient and should be replaced with a more efficient means of raising revenue.

Conveyance stamp duty is highly inefficient and inequitable. It discourages transactions of commercial and residential property and, through this, its allocation to its most valuable use. Conveyance stamp duty can also discourage people from changing their place of residence as their personal circumstances change or discourage people from making lifestyle changes that involve a change in residence. It is also inequitable, as people who need to move more frequently bear more tax, irrespective of their income or wealth.

Reforming land tax and conveyance stamp duty arrangements, along with the proposed changes to the taxation of rental housing and Rent Assistance, will go some way toward improving housing affordability. However, to a significant extent housing affordability is a supply issue (see Box 6.1).

Media Reports:

"Likewise the second part of the Henry Review’s two “key directions for efficient land and resource taxation”. The first part is the idea of a 40 per cent resource rent tax, which was first leaked in January. The response to the leak was obviously sufficiently mixed for the thing to become the centrepiece of Mr Swan’s tax reform.

The second part – and given equal weight in the review – is a national land tax of 1 per cent applying to all land regardless of use. Absolutely no mention of that in either leaks or today’s statement.

The Henry Review also recommends a 40 per cent discount to individuals for net interest income, residential rent, capital gains and interest related to listed shares. Also leaked, but rejected."

Business Spectator

The review proposes a 40 per cent discount on all income from savings, as well as on all residential rental income and losses, and capital gains.

These recommendations were widely flagged prior to today's announcement, with critics saying the current system doesn't give enough incentives for workers to put money in savings accounts.

Currently, interest earned on all savings accounts and term deposits is taxed at a worker's top marginal rate.

It is far less generous than the tax treatment of other investments such as shares and property, which the review says encourages investors to take on too much debt.

"The tax advantages from borrowing to invest in a rental property, also relevant for shares, leads to investors taking on too much debt and distorts the rental property market," the review says.

News Corp

Flood Maps

It is interesting to look at flood maps of Brisbane. You can see, for example, that SL8 is in a flood zone. Newstead River Park is an overland flow zone.

Better buying a recent apartment, than off-plan?

"“There are so many disasters out there,” said Lawrence Rich, a vice president of Prudential Douglas Elliman. “Every day you hear of another new building that’s in trouble, and people don’t want a building where there might be problems and they won’t enjoy living there while it all gets worked out.”"

Full Article

March 2010 Index Data

The RP Data – Rismark March Hedonic Home Value Index results released yesterday reveals that home values in Australia’s capital cities rose by 1.4 per cent in March (and +1.1 per cent on a “seasonally adjusted” basis) following on from similarly strong 1.7 per cent and 1.1 per cent growth rates across Australia in the months of January and February, respectively. In the 12 months to end March, Australian capital city home values have increased by 12.5 per cent.

Rpdata.com Director of Research, Tim Lawless, stated “We expect capital growth rates to cool in 2010 as the cost of mortgage finance is normalised by the RBA. Over the longer-term home values should be expected to track disposable incomes.”

Press Release

Brisbane values up 2.4% (median price: $439,000)

Brisbane apartments: Capital Growth to February 2010

Month: -0.9%

Quarter: 0.8%

Year to date: 1.9%

Year on year: 7.6%

Brisbane apartments: Capital Growth to March 2010

Month: 1.8%

Quarter: 3.7%

Year to date: 3.7%

Year on year: 9.1%

Medium over quarter = $375,000

Brisbane houses: Capital Growth to February 2010

Month: 0.4%

Quarter: 1.1%

Year to date: 2.0%

Year on year: 7.2%

Brisbane houses: Capital Growth to March 2010

Month: 0.2%

Quarter: 2.1%

Year to date: 2.1%

Year on year: 6.2%

Full details

Annual Rate of Return - Felix and Admiralty Two

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%

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."

www.south-point.com.au and AJG website

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

Flat Market in Brisbane

In talking with people in the real estate industry in Brisbane recently, it seems to me that the market is relatively flat. At some open homes for houses in the $600,ooo price range, only 1 family will turn up for an inspection. Off the plan sales for apartments are, for the most part, slow. Prices are relatively stable for apartments. It is not a booming market at present. On the Sunshine and Gold Coasts, the market is very dead.

There are pending risks that may dramatically impact investment apartments in Queensland:

• 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

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.

In my opinion, Park is overpriced:

"One, two, three bedroom apartments plus Pavilions are available for purchase now off the plan. Featuring classic toned interior colour schemes with functional spaces, clever storage and useable outdoor areas, each tower has a selection of floor plan styles to choose from.

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).

Talking Up A Dead Market on the Gold Coast

Real estate agents are always the optimists. Take this story in the April 3, 2010 Courier Mail (a newspaper that relies on real estate agent advertisements for its profits, so you will only read positive stories in the Courier Mail about real estate). The story is about the Gold Coast off-the-plan apartment market, and is titled "New apartments to dry up". In the story, Julian Sutherland, a director of Ray White Surfers Paradise, says "History will show that buyers who put their foot on product at today's prices will benefit significantly when the supply constraints diminish over the next year or two."

Compare this with a report from March 31, 2010 from Herron Todd White, who are independent registered valuers. In response to the indicator: "Are New Properties Sold at Prices Exceeding Their Potential Resale Value", HTW responds for the Gold Coast apartment market: "Very Frequently". See page 51 of the report.

So, if buying a new apartment on the Gold Coast off-the-plan or recently finished, take care with what real estate agents tell you, because despite Julian Sutherland's positive views, the real story may be otherwise. And Julian earns his commission from selling off-the-plan apartments on behalf of developers, so he is not in any way independent.

HTW also reminds us:

"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."

Brisbane Up Only Slightly

Brisbane housing prices up 0.4% in February quarter.

See RP Data information and Joye's blog

Brisbane Prices

"It's not only the sun that is expected to shine on Queensland this year; property prices are tipped to really begin moving.

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."

See Domain

Apartments for Sale in Brisbane

I looked at RealEstate.com.au to see what good apartments are for sale at present. These are quality apartments, in my view, and are relatively new. This is a good comparison when looking at off-the-plan developments and other apartments. All include car parking.

Two bedrooms

• 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

Larger One bedroom in buildings about 10 years old

• 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

I often visit off-the-plan sales offices for apartment projects, and I am often told about planned infrastructure. A new pedestrian bridge, or a new CityCat ferry stop, or a new bus route, or a new supermarket planned for a neighbouring or nearby site, or restaurants about to open. I go back a number of years later, and the planned infrastructure is still not there.

Sales agents often talk about stuff that will improve the area but that never actually eventuates. So be careful about such "promises". It is best to look at what the area is like now, because this is how the area may look for some time to come. Do not pay extra for future benefits that may never arrive. If they do arrive, then you will get some capital appreciation.

I walked around West End last night. A Saturday night. Boundary Street was alive and hoping. South Bank was busy and bustling. Montague Road was dead. It was dark and no people were around. Nothing was open. It is still a scary semi-industrial area. So be careful if buying into Flow, or Waters Edge, or Koko or Riverpoint. There is a lack of public transport, and it is a very isolated area. I would not walk home from the city at night to Flow or Riverpoint. The promises made by sales agents to me a number of years ago (new park, CityCat terminal, new coffee shops and restaurants opening, a new supermarket on Montague Road, a new bus route with regular buses for all the new residents) just did not eventuate. Still many light industrial uses and sheds for spray painters.

Wave or Montague West End

Some more details about Wave West End which may have been renamed Montague.

See Development website. It is located behind Stockland's Koko.

Keen Walk

Keen got his prediction wrong, and is now about to walk. See keenwalk.com.au and blog

See also Chris Joye

Mosaic The Valley

When I look earlier this week, Mosaic The Valley had not yet received Development Approval from the Council. Also, from what the agents are saying, they do not yet have enough pre-sales required to lock in finance to start building. It will be interesting to see if and when they start building Mosaic.

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.

The floorplans are very Mirvac. For example, the smallest 2 bedroom apartment has a floorplan similar to the two bedroom apartments in Mirvac's Arbour on Grey at Southbank. The difference is size. The Park two bedroom is 81 sqm internal with a 14 sqm balcony, for a total of 95sqm. The similar Arbour on Grey apartment is 106 sqm in total.

That being said, there are some larger two bedrooms, and all seem to be well designed. There are floor-thu apartments, with the living at the front and bedrooms at the rear. The two bedroom apartments range in size from 95sqm total, to 108sqm, to 112sqm, to 116 sqm.

In some of the 2 bedroom apartments, the living room is very small, and is only 3.5m wide, which in my view is too tight. Most of the apartments have the laundry in a cupboard, and have a galley kitchen along the dining room wall (and no island bench).

The building is way back from the river, on a park to be constructed -- the site was an old industrial site, and had contamination problems that have been cleaned up.

Mirvac plans about 7 other buildings for this site, so there will always be more apartments to compete with. Also, FKP and others are building on Newstead River Park site.That being said, it is generally a good location. See maps here and here and here.

What concerns me is price. An equivalent Mirvac two bed apartment, overlooking Southbank Parklands or the Brisbane Botanical Gardens would sell in the price range $650K to $800K, with sizes from 106 sqm to 132 sqm, and river views. It appears that these new Park apartments, although smaller and newer, will sell for $100,000s more than the current price for a quality Mirvac apartment in Brisbane.

And remember that Mirvac had over 15 apartments fail to settle at Tennyson, and they were resold about 20% less than the original sales price.

Riverpoint West End

Riverpoint at West End, stage one, is complete and owners are starting to move in. It would be interesting to know how many of the valuations came below contract price, and how many purchasers off the plan were unable to settle.

Riverpoint, stage one, still has apartments listed for sale. These include:

• 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.

I laugh that an agent has a 2 bed 1 bath listed for resale, at $550,000, giving the total area as 116sqm -- but this includes 17sqm of car park. Most other developers and agents do not include the carpark in the sqm area when selling an apartment, so take care!

I have inspected Riverpoint. The general quality looks to be very good. Some of the apartments are too small, in my opinion, and have bad aspects. The prices are high. There are many more stages of Riverpoint to come, so extreme care must be taken.

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.

Views and off-the-plan contracts

In a recent court judgment, the purchaser was able to get out of an off-the-plan contract, because the ocean views were obstructed. This purchaser was smart enough to put in a special condition into the contract dealing with this issue. Most purchasers however look at brochures and listen to the sales agent, but don't put what was promised into the contract.

Court Judgment

Courier Mail

Selecting a 2 bed apartment

I am often asked what to look for when buying an apartment in Brisbane. Here are some general rules of thumb and issues to consider.

• 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.

For a two bedroom apartment, here are some additional considerations:

• 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.

Not all apartments will be super apartments, and sometimes compromises have to be made. Price is also relevant! A two bed apartment for $450,000 will not be as good as a two bed apartment for $725,000! Or at least, I would hope so. So also look at price per sqm when comparing apartments.

Lack of Privacy

In some apartment buildings, there is no privacy. I was in Waterfront Place recently, and had a great view into the bedrooms and living rooms of many Felix apartments. I could see a person asleep in bed. You can see Waterfront Place offices clearly in this photo taken from the Felix apartment building.

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.

The plans are on the Shopping Centre website.

Meriton's Infinity to Launch Soon

Meriton's Infinity Tower on Herschel Street must be launching soon. Work has started on site, and advertising is starting.

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