Hello – I’m new to this board and to property investing. I want to buy an IP but I can only afford something in the sub 80K range, which limits my choices to rural centres.
Sooooo, I’m looking at a nice tidy, original 3 bed QLD’er in south-west QLD for 87K which the agent reckons will pull $160 a week “no probs, mate”. Heaps of lookers but no offers submitted so, I was thinking of offering 70K. (I’m in no rush and I don’t care if I miss out).
Does this seem reasonable buying? What are the pitfalls with rural IP’s (real and perceived)?
Any advice is greatly appreciated.
Many thanks,
GrahamIn a very general sense, rural provides a better rental income, but lower capital returns, than city properties.
Overall, city performs best over time.
As to the “no probs” agent, it should be easy enough to research what’s for rent and for how much. Then monitor it for a while, to see if they are really being let at those rentals.
Max Hugen [email protected]
Alpha Financial
Residential & Commercial Loans
http://www.alphafinancial.com.au
02 9560 3061Graham
I’m more than happy to buy rural cities however usually i don’t buy in smaller towns, say under 5,000. It’s important to really do your homework to make sure it wont be vacant. Ask the property managers in town how many vacant homes they have right now and also how long have they been on the books vacant, and final ask why are they vacant.
if you speak to enough property managers you will get a good idea of demand, after all we all want our properties let. also, yes go low you never know.
regards westanI find +ve cashflow deals in New Zealand which I sell to other investors. To be on my database send an e-mail to [email protected]
In General Speakering, what’s the LVR ?
Cheers
JulainTHERE IS ALWAYS A BETTER WAY!
Loan to Value Ratio[^]
“Money is a currency, like electricity and it requires momentum to make it Effective”
Ahhh, the Great Aussie Guarantee:
`the agent reckons will pull $160 a week “no probs, mate”.
hehe… you godda laugh :
Strider, generally rural properties will yield less than regional or citz properties. Check out the RE sites and go to their rental sections online or check the local rag in the town. Improvements swuch as aircon (SE QLD is hot), a carport etc, might just be considered de rigeur and not increase the rental much at all. Remewmber, the RE guy wants to sell you the property, so the ´she´ll be right mate´attitude will be a prominent part of his sales talk.Then again, 87k is a good price these days :o)
kay henry
Hi
I would phone the agent, saying you have a property for
rent. Ask what it will cost to be managed and how the market is.
I would phone all the agents in town saying you are looking for a 3 b/r to rent? seewhat you hear
recovery“I should be content to look at a mountain for what it is and not as a comment on my life” D. Ignatow
Strider
You will always receive a lower CG in a rural area.
Why not consider wrapping the property rather than merely renting it out.
As depending on which town the property is located the price of $87k may not be that cheap. Why not wrap and get the best of both worlds.
Cheers Richard
richard at fhog.com.au
http://www.fhog.com.auThere is no such thing as a problem.
Just a solution waiting to be foundRichard Taylor | Australia's leading private lender
Me I prefer growth properties. Therefore I dont look at regional centres. However as my portfolio grows then I will look for more positive geared properties at the expense of capital growth.
G’day Strider,
I purchased a highset Queenslander in regional Queensland late last year. Similar sort of numbers to the one you are looking at. Paid $88k for it and renting for $160p/w. The property was revalued day after settlement for $100k.
I was attracted to this property for several reasons.
1. I knew i was buying below market value
2. Qld’ers tend to be very popular, and easy to resell
3. Returns were good
4. Had the possibility to convert to a 4 bedroom (would cost as little as $1000 to do)& if I add a/c it will return over $200p/w
5. This property had great street appeal, and while some say not to get emotionally attached to IP’s, I believe that tennants DO get emotionally attached to houses they live in. Therefor if it looks like a desirable place to live, you will always get tennants.Of course the downside to old Qld’ers is they can be high maintenance. This particular one has had lots of $$$ recently spent on it, which made the decision easier.
Capital growth in this area was 12% over last 12months, but i dont expect this to continue, but i do expect steady CG due to strong and expanding jobs.
If you have any other questions please feel free to email me
mark at supermotard.net.au
[
]For me I prefer growth area as well as cash flow. If I can’t have both then I will buy some growth and some rural. This will balance out in long term.
Warm Regards
ChanDollars
[Keep going, you’re on your way to Frolic Freedom!]Hey Yack
have you changed your mind ???
i thought you would never buy cash positive properties ???by the way have you ever been outside of Melbourne ??
regards westan
I find +ve cashflow deals in New Zealand which I sell to other investors. To be on my database send an e-mail to [email protected]
Westan
<<<<by the way have you ever been outside of Melbourne ??>>>>
Yep – I’ve been to Ballarat a few times. We have done Bendigo before. Been to the peninsula. Even went to Mansfield and Bright once.
This weekend should be special, we are taking a few dyas off at the end of the week and we are off to Eucha for the long weekend. (I cant even spell it). The place on the Murray.
Did Qld a six months ago – ‘I even entered the Win the great aussie shed competition.’ Why do people even want to go there?
Popped into NZ 10 years ago. I got a traditional moari welcome at the Auckland cultural centre. Complete with toungue 6 inches from face. Could nt wait to leave country. Why invest there?
Did Ayers rock as a kid?
Married a Canadian after bumming around Europe for a few years. Moved with work to San Franciso for 12 months.
Nowadays I invest near home where I have complete control. From what I have seen not much beats Melbourne. This weekend its the Grand Prix and Moomba.
Westan
I saw a property today that excited me for around $70k.
About a 2-3 hr drive from Melbourne. It would have been a great holiday house. Not far from the hills for skiing and not too far from the lakes for summer.
But missed it by a day. Not sure if its bait advertising though.
See, I am starting to look out of Melbourne.
Originally posted by yack:Not far from the hills for skiing……
Yack, you got that right – hills!!!
Vic ski resorts aren’t that flash.
ooh, have I opened up a can of worms?
‘Eat rich food, barbeque a yuppie’
I am not into skiing – so I dont care.
Bugger and I was itching for a fight too[:p][:p]
‘Eat rich food, barbeque a yuppie’
New Zealand has some pretty decent hills for skiing, but i’m not into it either. Yack good to see you made it out of the city. You will find that country people make far better tenants also. Not like those tenants you get down Frankston way, why invest in an area where the tennats are constantly causing problems , not i would never invest there. Investing is supposed to add to your life not take from it.
(i’m itching for one too Rugbyman [])regards westan
I find +ve cashflow deals in New Zealand which I sell to other investors. To be on my database send an e-mail to [email protected]
And I thought I might get one with my comment about New Zealand.
But not this time. I did however, while living in London live with 6 kiwis and a chick from Sydney.
It was a party house and they all came from the sth of the Sth island. However, I have not yet made it down there.
Strider, generally rural properties will yield less than regional or citz properties. Check out the RE sites and go to their rental sections online or check the local rag in the town. Improvements swuch as aircon (SE QLD is hot), a carport etc, might just be considered de rigeur and not increase the rental much at all. Remewmber, the RE guy wants to sell you the property, so the ´she´ll be right mate´attitude will be a prominent part of his sales talk.
])You must be logged in to reply to this topic. If you don't have an account, you can register here.
