Sunday, March 30, 2014

Time to Buy or Sell in Brisbane?

A Brisbane real estate agent, Brad Munro from Position Property, has released a newsletter that states that the Brisbane market is booming.  He specialises in inner ring apartments.  He states "From 6th January of this year, we have seen the market explode!"  Brad then goes on to say that 5000 new apartments located within a 5km radius of the Brisbane CBD are expected to be completed in the next two years, and so there may be an oversupply of apartments, and more sellers than buyers.  Then, he concludes:  "Overall, the long term outlook for the property market in Brisbane looks good, however if you were looking at selling your property over the next 2 or 3 years, the next 3 to 4 months is, in my opinion, the best time to be doing this.  The less competition (other properties for sale) you have, the better the sale price will be, without question."

What this means to me is that now is not a good time to be buying, but wait a little while, and you may do better.

Or another view is that agents always tell property owners that now is the time to sell.

Sunday, March 23, 2014

Metro 21, Recent Sales

One of the better inner city apartment buildings is Metro 21.  It has a maximum of 4 apartments per floor, a sky garden, and no short term rentals.

Recent sales (since July 2013) of two bedroom apartments (all with car park, some with 2 bathrooms, some with 2.5 bathrooms):
  • Apt 1104 - $510,000
  • Apt 1204 - $500,000
  • Apt 2504 - $565,000
  • Apt 3201 - $590,000
  • Apt 3003 - $560,000
  • Apt 3401 - $595,000
  • Apt 3101 - $550,000
  • Apt 2101 - $545,000
Note that the first two digits of the apartment number is the floor level.  Some of the apartments on the higher floors have river views.  This building is not riverfront, but is centrally located near George Street.  Rents for two bedrooms, unfurnished, are above $600 per week.

Rents at Madison Heights, Bowen Hills

Madison Heights at Bowen Hills has completed, and apartments are available for rent.  For a 2 bedroom 2 bath apartment,  the listed rent is $445 (with 4 weeks free - so really the rent is $410 a week).  Some are even less.  Under the NRAS scheme, the listed rent for a 2 bedroom is $389 per week.

The building has 308 apartments, with 174 under the NRAS low income rental affordability scheme, which offers apartments for 70% of the market rent (so a two bedroom under this scheme should be $287 a week based on the REA listing quoted above.)  Most of the apartments are 1 bedrooms -- in fact, 228 or about 75% of the apartments in the building are one bedroom apartments with a typical size of 51 sqm internal.

Apt 2901, 2 bedrooms, is for sale for $715,000, which appears to be outrageously expensive.
This two bedroom is $547,000.  67 sqm internal. Crazy!
A one bedroom is for sale for $485,000 -- not a bargain!

Here are some photos of the views from Madison Heights apartments.  The entry to the Airport Link tunnel cannot be seen from these photos, but is just to the right:




Friday, March 21, 2014

UniSon by Mirvac at Newstead

Mirvac has announced another apartment building in Newstead, called UniSon.  This will be located on the edge of the "Waterfront" development site.  It appears that there are a number of buildings to come on this site, so you will have plenty of time to select an apartment now or for many years in the future.

Wednesday, March 19, 2014

Bees Nees - A real estate agent's view of the Brisbane property market

"After a number of years of buyers being firmly in control, here's two telltales for us that we have a market on a new, more balanced playing field:

Buyers are calling us back. We know we're real estate salespeople and shouldn't be surprised when some people don't want to talk to us! But it's been a little lonely in recent years... Now the calls are returned, buyers keen to hear what 'freshies' we might have coming up for them.

The second reason? In the past fortnight I've had 3 real estate agents contact me chasing investments for themselves. Like a Charleville grazier can smell the coming rains, these agents get a sense when the market's on the turn.

It's not all one-sided. Despite the competition we've still seen some price sensitivity from buyers. They're well-informed and most are not yet rushed to pay over the odds. They recognise there's a shortage of listings across many inner city markets and prices, but many are still okay to bide their time. There's more balance but it's too early to say it's a sellers market.

With that said, if you've been holding off selling I haven't seen a market as good as this since 2004.  Many are hoping it will continue 'gaining momentum' and those 'green shoots' will sprout into price growth to make Jack’s beanstalk look tiny."

From Bees Nees.

It seems that houses are selling much faster than apartments in Brisbane at present.

Tuesday, March 18, 2014

Gold Coast - Soul

From Mantra:

I am a representative of the Mantra Hotels Group, who have recently taken ownership of Sea Temple Surfers Paradise, under the Peppers Brand.

The property has been re-branded Soul Surfers Paradise and Peppers are keen to revitalise both the hotel and the Seaduction restaurant under their luxury hotels brand.


We'd appreciate you letting your readers know of the changes at Soul:


Monday, March 17, 2014

Australian Interest Rates - Predication by Westpac

From Westpac:

Westpac has revised its profile for the RBA cash rate in 2014. Previously we expected that rates would be reduced by 25bps in both August and November. The forecast is now for flat rates throughout 2014. As before we do not forecast a rate hike until the third quarter of 2015 with a 25bp hike in both the September and December quarters. 

Growth in housing finance has been very strong, up 26.9% for the year to December and 22.3% for the year to January. Within that, loans to investors slowed from 40% (in December) to 28.6% in January. Owner occupiers slowed from 19.4% (December) to 18.6% (January). The “time to buy a dwelling” index from the Westpac Melbourne Institute Consumer Sentiment Survey is down by 16.8% from its September peak. There are tentative signs that housing lending might be slowing. As discussed, that slowdown, which has always been core to our forecasts, appears to be evolving. However, such a slowdown was a necessary but not sufficient condition for lower rates. 

Friday, March 14, 2014

A victory for miniature dachshund dog ‘Sebastian’ over the Committee

It seems that Body Corporate Committee members are officiously and uncaringly trying to prevent apartment owners have pets, even though there is no legal or other justification to do so.  A recent case involving a miniature dachshund dog called Sebastian highlights these issues.  The apartment owner was allowed to keep Sebastian in her apartment.

See Bougainvillea [2013] QBCCMCmr 448 (11 November 2013)

"Both the Committee and many submitted appear to believe that By-law 11 prohibits pets in the scheme. That is not correct. Adjudicators have consistently held that by-laws like By-law 11 are ‘permissive’ in that they allow the keeping of pets, albeit with prior consent. 

Adjudicators have further held that where there is a permissive by-law, the body corporate cannot impose an automatic ‘no-pets policy’. A body corporate may have a preference against pets, but it cannot override the potential in the by-law for consent to be given by imposing a policy of banning all animals. Under a by-law of this nature, the committee must consider each request for a animal on its merits and exercise discretion in whether to approve an animal or not. Accordingly the Body Corporate must consider each request on its merits.

Some schemes have tried to adopt by-laws that ban all animals, but this has been found to be contrary to section 169 of the Act. Section 169 provides for by-laws to regulate the use and enjoyment of lot, but does not authorise a by-law prohibiting such use and enjoyment."

"One submission notes that some tenants may have phobias to dogs. Another is concerned that some children could be frightened by the dog. While there may be some basis for genuine concerns about larger dogs, it is more difficult to perceive such difficulties with such a small breed of dog. In any event, if the applicant were to always ensure that the dog was carried or adequately restrained during its brief transits across common property, there seems to me to be little risk of any adverse impact."

See also Sunwaves [2013] QBCCMCmr 433 (30 October 2013)

Sunday, March 9, 2014

REIQ reports improving market for apartments in last quarter of 2013

The median price of units and townhouses across South East Queensland grew over the December quarter, according to the Real Estate Institute of Queensland (REIQ).

The REIQ’s latest Queensland Market Monitor (QMM), released 28 February 2014, also found the preliminary numbers of unit sales increased six per cent over the year.

REIQ CEO Anton Kardash said the unit market was continuing to improve in-line with the house sales market – albeit centred around the southeast corner.

“A key difference between the Queensland house and unit markets is that predominantly the lion’s share of these types of properties are located in the southeast as that is where demand for housing is the greatest,’ he said.

“In fact, demand for units in Brisbane has resulted in record numbers of off-the-plan sales lately. According to recently-released research, more than 1,000 new apartment sales were transacted in the December quarter – the highest level since 2002.”

Click on chart to make bigger:


The most sales where in the Brisbane CBD, followed by New Farm, Nundah and St Lucia.

The largest one year change to the median price were in Wynnum West, Highgate Hill, Windsor and Paddington.  The worst performing suburbs were Northgate and Kedron.

Is Housing Market Slowing?

From an RP Data press release:

Mr Lawless said we will need to see further months of flat to negative movements before we can confidently say the housing market is slowing. “Our view is that housing market conditions will start to wind down later this year as affordability constraints and low rental yields dampen market conditions. Additionally, with a belief that mortgage rates are likely to start tightening later this year, it may help to quell some of the exuberance we have been seeing,” he said.

Brisbane apartment prices (to 28 February 2014):
February 2014 - up 0.3%
Quarter - up 1.5%
Year on Year - up 3.1%
Year to Date - up 1.1%
Median price based on settled sales of Brisbane apartments over the quarter - $387,000.

Saturday, March 8, 2014

Florida Foreclosures

It is interesting to see that in Florida, it is possible to buy a one bedroom apartment for less than $80,000, including whitegoods.

1)  http://searchbankproperties.com/2014/03/bank-owned-condo-in-bermuda-dunes/


Makes the Gold Coast look very overpriced.

Friday, March 7, 2014

Rising Market

Valuer, HTW, reports that both the Brisbane and Sunshine Coast apartment markets are currently "rising markets".

See March 2014 Month in Review.


Sunday, March 2, 2014

Soda Goes Soggy

It has been reported recently that the Soda apartment development in South Brisbane did not receive development approval from the Council.  Although 129 out of 131 have sold off-the-plan, the developer had not obtained development approval to build the building.

A newspaper report states that the apartments do not have sufficient ventilation, ceiling heights are too low, and there is not enough visitor car parking.  "The only outlook of many of the habitable room windows would be to a (future) adjoining development in very close proximity."

Well-known property law David Colenso said:  "Contracting 98% of apartments without a development approval contravenes all the basis risk parameters of property development.  Judging by the extent of councils refusal, this developer may need to redesign the development which puts at risk all contracts under Queensland's disclosure regime."

When I looked at this development in October, I thought that it was expensive.  It now looks to be very expensive, due to what appears to be poor quality design.

Investors buying off-the-plan should look at the checklists and information in this book.  Ceiling height, aspect and cross-ventilation are important to consider, and are often not disclosed in the glossy sales brochures.

Saturday, March 1, 2014

Admiralty One

Apartment 59 in Admiralty Towers One sold at auction this week for $585,000.  It is a two bedroom apartment, in one of the best buildings in the city.

Sunday, February 23, 2014

The Next Stage of Waterfront Newstead

Mirvac is soliciting interest for the next stage of its Waterfront, Newstead project.

See www.launch2014.com.au

Often, I register on these kind of sites, and never hear back.  When the developer is setting the sales price of apartments off-the-plan, one factor taken into account is how much interest they have in the presales stages.  Developers count the number of registrations on sites such as this, and take this information into account in setting price.

Saturday, February 22, 2014

Housing Market in Qld strongest in years, says real estate agents

From an REIQ press release yesterday concerning houses (not apartments):

"The numbers of house sales across Queensland peaked at the end of last year as well as recorded healthy price growth, according to the Real Estate Institute of Queensland (REIQ).

The REIQ December quarter median house price report, released today, found that the volume of house sales hit its annual peak of activity in the last three months of 2013. The numbers of sales was also one of the healthiest quarterly periods for a number of years.

REIQ CEO Anton Kardash said not only could the December quarter claim to be the third strongest in as many years, it was also firming without the aid of extraneous stimulus measures."

Warren Buffet's view of buying in the resale market

Should I buy off-the-plan from a developer, or a resale apartment?  Warren Buffet has an interesting view in relation to IPOs and stocks, from his letter to shareholders in 1992, that I have adapted below for residential real estate:

"The secondary market which is periodically ruled by mass folly, is constantly setting a 'clearing' price.  No matter how foolish that price may be, it's what counts for the holder of property who needs or wishes to sell, of whom there are always going to be a few at any moment.  In may instances, properties worth $X in value have sold at 1/2 or less.

The new off-the-plan market, on the other hand, is ruled by developers, who can usually select the timing of offerings or, if the market looks unfavourable, avoid an offering altogether.  Understandably, these sellers are not going to offer any bargains; it is rare you'll find X for 1/2 X here."

Tuesday, February 18, 2014

Another Pradella West End Development

Pradella has started marketing a new development on the large parcel of land it has accumulated in West End.  This development is being promoted as Gardens Riverside West End (although it is not river front, and has a road and the Waters Edge buildings between it and the river, and it is a long walk from the main shopping and restaurant street in West End).

There appear to be many more Pradella buildings planned for this plot of land in West End.


Thursday, February 13, 2014

New or Resale?

I am often asked whether it is better to buy a new or resale apartment?  A new apartment can be unsold developer stock in a new building or an off-the-plan apartment for a building not yet built.  A resale is a sale from someone other than the original developer.

There is a price difference between a new and resale apartment in Brisbane.  Sometimes, this is because a new apartment is new, with no wear and tear (e.g., freshly painted, new carpet, new kitchen, new appliances, etc).  But often, the price difference is not explained by newness.  Sometimes, the price difference is due to developer profit and marketing costs.

For example, Sunland is currently marketing Abian.  A large number of people I know have received a fancy brochure mailed to them, unsolicited, by Sunland.  There is an expensive display office onsite in Alice Street, where the landscaping alone would have cost a small fortune.  There is a video of a lost rich girl wandering around Brisbane, that does a good job not showing the neighbouring Quay West building.  Buyers are paying for all these marketing costs, plus the developers profits.

Another example is Infinity, by Meriton.  2 bedrooms, 2 bathrooms, 89 sqm in total, no balcony, 7 apartments per floor, short stay and hotel guests, for $647,000 and up!

Or you can buy an apartment in Metro 21, on level 25, with river views, a large balcony, 2 bedrooms, 3 bathrooms, 113 sqm total floor area, 4 apartments per floor, no short term rentals or hotel guests.  For a price less than a Meriton apartment.   Metro 21 is a boutique residential building, with good facility, and a low ratio of residents to facilities.  Seems like an obvious decision to me.

That is $7,269 per sqm compared with less than $5,700 per sqm.


Wednesday, February 12, 2014

Brisbane Update

A video from RP Data regarding the Brisbane property market is here, presented by Tim Lawless.

Tuesday, February 11, 2014

A valuer's view of Brisbane

From the HTW Month in Review for February 2014:

"... Brisbane is often touted as the next most likely to move after Sydney and Melbourne, and there’s no denying that some of these southern states saw a boom run on many suburban market as 2013 drew to a close.  In the field, agents are telling us that things are looking good. There have been multiple lookers at open homes and some auctions are jagging prices above vendor expectation. The pick locations are, and have always been, close to the CBD. The old story of limited supply and good quality stock plus comparatively high demand mean that as long as you’re appropriately priced, there is definitely a buyer or two out there for your property."


Saturday, February 8, 2014

550 Queen Street Potential Tower

Consolidated Properties has put 550 Queen Street up for sale.  It has frontages to Queen St, Ann St and Clark Lane.  The land has development approval for a 20,000 sqm tower.  The AFR reported on Thursday (8/2/14, p. 45) that there was strong interest from residential development companies.  (The article also states that 4000 residential apartments are currently under construction in Brisbane, with up to another 3000 that could complete by 2015/16.  There is a risk of oversupply.)

This proposed development will have a negative impact on Willahra Tower, at 540 Queen Street.  Willahra Tower is an apartment building that has short term rentals.  (Bad reviews on TripAdvisor.)  Small apartments, with a two bedroom less than 75sqm internal.  Apartments are advertised as "cheap", and there is a reason for this.  My advice -- avoid!


Wednesday, February 5, 2014

Botanica South Brisbane

From information provided by Aria:

Botanica will be located in a prime location at 2-4 Edmondstone Street, South Brisbane which is opposite Coles and adjacent to the renowned Boundary street retail precinct.   The building will consist of 1 and 2 bedroom units, indicatively priced as follows;

  • 1 bed 1 bath with parking (50sqm internally & 7sqm balconies): high $300’s - mid $400’s
  • 2 bed 1 bath with parking (65sqm internally & 10sqm balconies): high $400’s – mid $500’s
  • 2 bed 2 bath with parking (80sqm internally & 10sqm balconies): high $500’s - mid $600’s
That pricing seems high to me.  I can buy a great two bedroom two bathroom apartment in a good inner city building, that is more than 85 sqm internal and more than 12 sqm external, for less than these prices.


Executive Rentals Drying Up in Brisbane?

From Bees Nees:

Worryingly, the general consensus was that the executive rental market has been hit by the slow down in the mining boom and the completion of many plants that employed large numbers of workers. The feedback we got is that there may be a gap in the market between construction tailing off and the take up of skilled workers to run these plants. How long the gap will be is hard to quantify.
Two prominent executive relocation companies have said this was the quietest January they can recall in a long time. Based on this information our client has now decided to offer the property with an unfurnished option in the hope of boosting local enquiry. Watch this space in the coming months to see if executives rents are affected by this slow down.

Brisbane in Early Stage of Growth Cycle

"Rental rates continued to grow at a slower pace than dwelling values and further eroded rental yields across the capital cities. The markets where dwelling values have shown the most appreciation, Melbourne and Sydney, are now showing gross yields for houses below 4 per cent while the typical gross yield on a Melbourne and Sydney unit are higher at 4.2 per cent and 4.7 per cent gross respectively, however, they are lower than in all other capital cities.

According to Mr Lawless, such a yield environment may potentially start acting as a disincentive to investors. 

“With gross yields low in Melbourne, and not a lot better in Sydney, together with the fact that both these markets are well advanced in their growth cycle, it would suggest that investment fundamentals in these markets are waning. It is my view that investors will start seeking out the higher yields of Brisbane where the market is also far earlier in the growth cycle,” he said.

The Brisbane apartment median price is up 2.6% for the quarter and 0.8% for the month, according to RP Data.


Sunday, February 2, 2014

Recent Brisbane City Apartment Sales

Based on recent apartment sales in the Brisbane CBD area (resales, not off the plan), it looks like the market is strengthening.

Skyline, 30 Macrossan Street
  • Apt 242, 2 bedrooms - reported sold at $725,000
  • Apt 73, 2 bedrooms - reported sold at $660,000
  • Apt 121, 3 bedrooms - reported sold at $715,000
  • Apt 113, 2 bedrooms - reported sold at $602,000
  • Apt 125, 1 bedroom - reported sold at $347,000
  • Apt 173, 2 bedrooms - $588,000
M on Mary, 70 Mary Street
  • Apt 2202, 1 bed plus study - no car - $362,500
Aurora, 420 Queen Street
  • Apt 245, 2 bed, 1 bath - $620,000
  • Apt 435, 2 bed, 1 bath - $556,000
Riparian, 71 Eagle Street
  • Apt 4305, 3 bedrooms - $1,850,000
Riverplace
  • Apt 215, 1 bed - $510,000
  • Apt 37, 2 bed - $690,000
Casino Towers, 151 George Street
  • Apt 2002, 2 bedrooms - $690,000

Saturday, February 1, 2014

Aria's South Brisbane Bet

The AFR on Thursday (30/01/14, p.38) had a full page story about Brisbane apartment developer, Aria.  Some highlights:
  • Aria has sold 188 apartments in three residential towers it has completed in South Brisbane since mid-2012.
  • It has a 20 storey tower under construction on Grey Street.
  • It is about to start another 20 storey tower of the corner of Edmondstone and Boundary Streets.
  • Aria owns a dozen more sites in South Brisbane.
  • South Brisbane is catching up to Bowen Hills and The Valley for residential apartment development.
  • The change is due to construction of office towers, bring 10,000 workers to the area.
  • Residential building approvals have jumped from 151 in 2010/11 to 744 in 2012/13.
  • Gross rental yields are said to be 6%.
  • Prices for Aria's apartments are $7,500 to $8,000 a sqm, and are likely to rise.
  • Aria has lodged a DA for a 26 storey tower on Hope Street that will have over 180 apartments.
  • Aria pays interest on deposits for off-the-plan apartments.
  • 75% of Aria's clients are investors, with fewer than 10% being SMSFs.
  • Half the buyers are from SE Queensland.
  • There are more than 4000 apartments under construction in inner Brisbane.  The biggest supply potential is in Brisbane's North Eastern area, around Bowen Hills and The Valley - this is seen as a risk.

Low Growth Conditions for Property?

The Brisbane property market is somewhat uncertain at present.  There are fewer apartments on the market, with most property owners deciding to hold on to their property.  Low interest rates are good for investors.   Many of the apartments that are for sale have been for sale for a long time at an unrealistic price.  Price growth has not been magnificent in Brisbane.  And rent grown has been poor.  Currently, there is a higher vacancy rate for apartments (particularly furnished apartments).

The AFR on Thursday (30/01/14, p.3) states:

"Sydney and Melbourne house price growth is likely to slow to half the pace of last year, a leading property researcher says.  ...  But a weaker economic forecast, a lower Australian dollar, combined with rising unemployment and inflation are likely to keep a tight rein on further gains during the year."

But on the same day, Property Observer included the following:

While Melbourne and Sydney slow, Brisbane is tipped to bang.

“The Brisbane market is still in catch-up mode, but the Queensland economy is ramping up with regional centres recording growth. There will be an increase in job seekers in Queensland too, as they shift from Melbourne and Sydney where the jobless rate is higher,” Wilson says.  “Investors will be more interested in Brisbane real estate because of its potential for high yields and prospects of high capital growth.”

Friday, January 31, 2014

Vacancy Rate Increases for inner Brisbane


As the Queensland sales market kicks into gear, pressure on the rental market has eased according to the Real Estate Institute of Queensland (REIQ).

The REIQ Residential Rental Survey, carried out in December across all REIQ accredited agencies, found the majority of the State recording higher vacancy rates compared to the previous three months.  REIQ chairman Rob Honeycombe said that it was usual for one market to thrive more than the other.

“Over the past few years, it has been the rental sector which has been the better-performing segment of the market,” he said.  “Now while the sales market returns to healthy levels of activity after a period of subdued volumes, the rental market is experiencing a slight easing of vacancy rates after a long period of tight rental conditions. The rental market is also cyclical with January and February being the peak periods for demand.  While rental markets within the mining regions are struggling with both supply and demand imbalances, the outlook for the rest of the Queensland rental market remains positive as business returns to normal now the Christmas holidays have passed.”  

According to the survey data, over one third of REIQ member agencies reported an increase in investor activity which subsequently added stock to the rental pool.  In addition to this, the end of the year is historically a period of lower tenant demand with many vacating over the Christmas and New Year periods, usually in a move to another area for either work or educational reasons.  Over recent weeks, however, there has been an increase in enquiry and demand from tenants as is usual for January.

In the Brisbane City local government area, the vacancy rate as at the end of December was 3.2 per cent, up from 2.3 per cent at the end of September. A vacancy rate of around 3 per cent however is deemed to represent healthy levels of supply and demand.

Across Brisbane the results are varied. Inner Brisbane - suburbs within 5km of the CBD - recorded the highest increase, up 1.7 percentage points to 4.1 per cent.

“Local agents have reported a slight oversupply of rental properties with a number of new developments coming onto the market,” Mr Honeycombe said.  “Also at the end of the year we generally experience lower tenant demand as residents vacate for work transfers or the end of the university year. From mid-January, demand increases again as tenants begin their search for their new property.”  

Brisbane off the plan apartment prices expected to soften in 2015/2016

In an article in Property ObserverBIS Shrapnel is forecasting further strengthening of the off the plan apartment market in Brisbane over 2014 and 2015 before a period of softening.

"Senior project manager and report author, Angie Zigomanis, said that the inner Brisbane apartments are increasingly attractive with yields in many of these projects around the 5% mark and above.

“However, with many expecting that the Brisbane market has now bottomed out and the risk of further price declines is dissipating, the impetus to enter the market has increased,” said Zigomanis.

Price growth up until the 2015/2016 peak is expected to be around 5% per annum.

Thursday, January 30, 2014

Walter Taylor Bridge

An interesting article about the Walter Taylor Bridge at Indooroopilly, by a real estate agent, sent to me by a reader.
See here

Sunday, January 26, 2014

Selling Your Apartment

When reading a recent story in The Times (from London) titled "How to avoid house-sale hell", about a lady who went through a series of real estate agents, and taking 18 months to sell her London house in a rising market, it reminded me of many stories I have heard about bad real estate agents in Brisbane.

Some common complaints about Brisbane agents:
  • Not returning phone calls and emails.  (This always amazes me.  As as cash buyer, I often have trouble having agents return my emails when I am wanting to buy an apartment that they have listed for sale.)
  • Pushing expensive advertising packages on the seller.
  • Pushing auction sales on the seller.  For most properties, an auction is the less desirable way for the seller to sell a property, often leading to higher sales costs and a lower sales price.
  • Using a "front man" who sells the agency's services, but who is never seen again.  Young inexperienced sales agents then do the open house and deal with the buyers and sellers.
  • Having an agent give a misleading impression as to how long it will take to sell the property.
  • Listing the property at too high a price.
  • Conditioning the seller, with unreasonably low (and sometimes fake) initial offers.
Many sellers are often surprised at how few people come to inspect, and that those who do are often completely disinterested.

Saturday, January 25, 2014

Queensland Coastal Apartments - Capital Losses

RP Data recently issued is "Coastal Housing Markets - December 2013" report.

"Across the Sunshine Coast, median house values are typically most expensive in the Noosa region and most affordable between Caloundra and Maroochydore. Sunshine Beach has the most expensive median house value ($894,733) and Currimundi the most affordable at $400,631.

Median house values across the Gold Coast and Tweed Coast tend to be most expensive at the northern end of the Gold Coast. Across the region, the most expensive houses are found in Surfers Paradise ($962,563) and the most affordable are in Labrador ($392,681)."

Medium value as at September 2013 for apartments:
Noosa Heads - $528,000
Maroochydore - $323,857
Mooloolaba - $358,380
Kings Beach - $367,888
Surfers Paradise - $337,767
Broadbeach - $401,824
Palm Cove - $336,795
Port Douglas - $251,312

Number of apartment sales:
Noosa Heads - 238
Maroochydore - 404
Mooloolaba - 234
Kings Beach - 124
Surfers Paradise - 1068
Broadbeach - 418
Palm Cove - 54
Port Douglas - 270

Change in value over past 5 years
Noosa Heads -  negative 23.3%
Maroochydore - negative 17%
Mooloolaba -  negative 5.2%
Kings Beach - negative 13.7%
Surfers Paradise - negative 15.4%
Broadbeach - negative 10.5%
Palm Cove - negative 21.5%
Port Douglas - negative 13.1%

Friday, January 24, 2014

Interstate Property Buyers

The AFR had a story on page 3 on Wednesday this week: "Interstate property buyers see value in northern exposure."  Some extracts:
  • Investors from Sydney and Melbourne are flocking to Brisbane's apartment market seeking better value for money after being pushed out of increasingly expensive southern cities.
  • Brisbane developer Silverstone Developments reports that 72% of off-the-plan sales in its Vertice project at Dutton Park were sold in interstate buyers.
  • Other developers are all reporting surging interest from interstate buyers.
  • Mirvac's chief executive for residential said there was an upswing in sales of quality Brisbane properties to interstate investors due to the low rental vacancy rates and increasing rental yields in prime locations across Brisbane, as well as the price differential between Brisbane and those in southern states.
  • Since 2007, the gap in prices between Brisbane and Melbourne/Sydney has slowly opened up again.
  • Further interest in Brisbane will be contingent upon how may jobs the south-east of the state creates.
  • There is a lot more value for money in the Brisbane market, according to Metro Property Group.