- RobertMatheMember@robertmatheJoin Date: 2002Post Count: 2
I was on the Gold Coast recently and I walked into a Real Estate Agency. The agent tried to sell me his wealth creation idea. He tells me that its made him a millionaire.
He’s selling apartments in a building called Queensland 1. Its going to be the tallest residential building in the world. Over eighty stories high and 500 units (400 already sold). The idea is to buy off the plan with 10% down and on-sell it before settlement 2-3 years later. The agent told me has bought two apartments himself for $1.2 million each. A cheap unit in this building sells for $500,000 – Ian Thorp has bought one for over $3 million.
This strategy seems to me as it could be a good one but too risky for me in this stage of my life. It’s using the principle of leverage and this type of investing may suit someone out there. I just thought others may have some ideas on the subject.
[8D]darrenbMember@darrenbJoin Date: 2002Post Count: 71
Ask yourself the question. If he is a millionaire, why is he flogging this to you? How much commission is he going to make? It could make you a bucketload, but do you have a cystal ball. Many southerners have been burnt bigtime, buying high rises on a holiday. Stick to the beach!Steve McKnightKeymaster@stevemcknightJoin Date: 2001Post Count: 1,763
I strongly recommend you do the numbers on this deal mate…
As an investment, it has the smell of strong negative gearing about it, which may be OK depending on your strategy (save tax vs. make money).
I’d also point out that the apartment complexes down here are underperforming from what I hear and read and advise caution.
Remember to draw a distinction between fact and opinion.
Thanks for your post and if you’d like to be more specific on the numbers I’d be willing to analyse it online as a case study for you!
Steve McKnight | PropertyInvesting.com Pty Ltd | CEO
Success comes from doing things differentlyCYMember@cyJoin Date: 2002Post Count: 7
Stay away from those hi rises !
Two main reasons:
1. Strata fees usually high 5000+pa, no guarantee that it will be 10k next year , plus sinking fund etc. Also, nobody knows how well will the building be managed.
2. LACK OF SCARCITY.
– Another ‘taller’ building can be build next door
– Similar building, similar rent, no ‘unique’ features.
– Likely ‘low’ capital growth.
– Many ‘rich’ investor from Asia bought & they will liquidate first at bargain basement when things turn sour.
Similar bldg – World Tower in Syd- 75 storeys also selling quite well ( I think) despite price tag 800k+ for two bedders.
Having said that, however for ‘smaller’ unit/apartment in inner city, close water, views etc should perform no differently than most houses w/ backyard.
MY OPINION ONLY – good luck for what ever you decide.ChrisBedfordParticipant@chrisbedfordJoin Date: 2002Post Count: 23
I assume the agent told you about Ian Thorpe buying here.
I also assume this is meant to give credibility to the project.
The ‘Halo effect’ is where someone with expertise in one field is attributed with expertise in another unrelated field.
Thorpy may be be an expert investor for all I know but it’s a good idea to heed Steve’s advise about fact and opinion.
Edited by – [email protected].au on 28/06/2002 1:20:03 PM
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