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  1. #21
    Join Date
    Aug 2005
    Posts
    358

    Default

    it could mean that but i doubt it

    surely that apartment block must be sold down by now

  2. #22
    Join Date
    Jun 2005
    Location
    auckland New Zealand
    Posts
    5,236

    Default

    Do you do anything in Brisbane Don?? There's a lot of comments over there about infrastructure slowing growth but prices just seem to keep heading up.

  3. #23
    Join Date
    Aug 2005
    Posts
    358

    Default

    Ps Love the dog!
    Hi and Cheers - she is 5 year old jrt "tiny".

  4. #24
    Join Date
    May 2008
    Location
    Auckland
    Posts
    8

    Default

    Hi,
    Some intersting comments over the last week.
    I have recently returned from South East Qld - where I did some research while there.
    Interesting on the comments re steel/building prices going up – obviously makes the new construction more expensive but does it make existing apartments a better price for reselling???

    It seems to depend on the property!!
    RP Data recently released new property statistics based on Capital growth of apartments. Their research found that of the 87 developments analysed, Brisbane had four in the top 10 performing projects, Perth with 3, 2 in Adelaide and Sydney just one.
    Tim Lawless, research director with RP Data, said “All of the top 10 developments enjoyed locations either on the waterfront or were located in areas very close to the waterfront. In most cases the projects were smaller, boutique offerings less than 100 units in the building,” Also “A little surprising is the fact that of those developments, which were the top performers in Queensland, all were located in Brisbane with none coming from the Gold Cost.” Tim Lawless also noted the owner-occupier market was the target for the top performers rather than investor market and long term rather than short-term accommodation.

    A further comment was “Developments that recorded low levels of growth, or in some cases negative returns, showed some interesting commonalities – each of the 10 worst performers offered short-term, serviced apartment-type facilities.”

    We made several visits to Real Estate agents & Developers offices that were interesting – one such company offering apartments in NZ would not discuss a particular project – had to speak with only one individual along with a particular broker – one has to wonder what they have to hide??? Would the valuation stack up? As the Lenders in Australia will not provide a copy of the independent valuations to purchasers, is the broker providing the information to the purchaser? Is the broker there to make the deal happen for the vendor, for themselves or in the best interests of the purchaser?
    The free boat trips and free meals were around 10 years ago which raised the question then & again now – who is paying the cost – it must presumably be factored into the purchase price of the properties.
    An article from afr.com had the following headline which in my opinion would also have an effect on short term holiday accommodation:-
    Trouble in the land of Tourism
    The $85 billion tourism industry is losing market share to the Asia-Pacific region and more Australians are travelling overseas than tourists are arriving here for the first time in nearly three decades, according to Tourism Minister Martin Ferguson.

    As I said before, research saved me from being $36,000 down if settlement had occurred on my first attempt to purchase in Australia (took 3 months to get the $1,000 deposit refunded but made $6-00 due to the exchange rate at the time!!). Since that first venture other properties have been purchased after extensive research with success.

    Experience has shown that Body Corporate fees do have a bearing on the overall cash flow of the investment – dealing with the Body Corporate can also be a long drawn out procedure – again from personal experience. If the rent is $320 per week and the Body Corporate is $41-00 pw once the management fee and BC are taken off the rent - it has an impact on the amount left to pay the mortgage!
    Some properties rent quicker than others in different locations and capital growth will also vary just as it does in NZ– so from my experience and opinion it is imperative as a New Zealander when buying into the Australian property market to know the market and the relevant information regarding structures, tax & accounting issues from long standing experienced qualified owners.
    Don I agree in part with you that local brokers know what the locals also know in regards to some apartments, however some NZ brokers are also aware of the situation when they take the time to attend seminars put on by the funders in Australia as well as in depth on the ground research. I use Mark Uden for that reason alone.

    From my own experience I have learnt that facts and in depth research are more important than listening to and relying on emotional sales hype.

  5. #25
    Join Date
    Nov 2005
    Posts
    346

    Default Interesting facts

    I saw some sales statistics of sale prices on individual apartments in recent developments on the Gold Coast.

    1. Apartments, irrespective of the time 2,5,7 years, did not sell for much more than the original price. Even if it sold 1,2,3 times

    2. What happens is as new developments are built, the price of those apartments are higher. They are then compared to the older developments as 'proof' of capital gain.

    3. Go back to point 1

    I agree with Dean, and have said it before, be very careful of who and what you invest in in Aus.

    As a Senior Manager at a major bank commented recently after seeing Mark Uden this month, 'I liked him, all the facts with non of the tinsel' Tinsel (boat trips, meals, 5 star hotels I guess) I love it

  6. #26
    Join Date
    Nov 2005
    Posts
    346

    Default Secondary Market

    My parents were involved in the last round of Queensland sales people in NZ 10 years ago.

    They mentioned the 'secondary market'. Ask any agent on the Coast about it (and Margaret Lomas's article in the Jan Aus Property Investors Mag) and that is what they wait for off the plans. So I have a couple of questions:

    1. Does anyone have a definition of this 'secondary market?'

    2. How is this different from '2nd tier'

  7. #27
    Join Date
    Jun 2005
    Location
    auckland New Zealand
    Posts
    5,236

    Default

    My research from the likes of Midwood shows that most stuff bought off plans sells on title for considerably more than original, butit varies widely from developer to developer. Merriton is known for high prices which he subsequently discounts so you wouldn't go there. But look at Juniper on Soul. Apartments selling for 950K off plans have now resold for 1.9 mil and they aren't built yet.

    The cost per square metre to physically build them is a driving factor as well. Build cost for quality high rise is getting up to 10K per sqm now. You can buy in some good developments still for 8k. They will sell for considerably more on title.
    Or Jade is another good example for a small development. Off plans for 3.8 mil. Last sale on completion was 5.9 mil.

    I think a lot of people remember the late 80's without realising that PAMDA put all the shonky developers out of business. There is fabulous money to be made there off plans. I've bought 20 million worth myself, and will buy more. I watch the sqm rising and could cash out of some of mine at a profit now but wouldn't because of CGT.

    I'd transfer my entire portfolio into the Gold Coast if God would let me. Once the airport upgrade is complete and the dream liners start flying there are 5 new countries flying straight in to the Gold Coast. There's a lot of money to be made there in the next 5 years.

    Re your questions "second tire" was when agents were selling developments and getting a kick back for m the developer. PAMDA outlawed that so it can't happen now. All interested parties are fully disclosed.

    On the Gold Coast a secondary market would be foreigners who can only buy new so they have limited options on purchase. Also there is a big secondary market on the Coast from the USA. Americans typically will only buy product that is built so they are an established secondary market for on-sells in new buildings.
    They don't like ot wait for OTP stuff apparently.
    Last edited by [email protected]; 31-05-2008 at 10:21 PM.

  8. #28
    Join Date
    Aug 2005
    Posts
    358

    Default

    I've bought 20 million worth myself

    Do you mean optioned of have you gone unconditional on 2o mill worth of property.

    Someone emailed me something recently saying that you had paid 14k for options on 18mill of otp apartments.


    If that is the case it is a massive hyperboly to say you have purchased 20mill worth - however my info was second hand so if you have gone unconditional on 20mill worth then I will admit that is pretty impressive.

    I could see why you would be invested in helping others into those projects.

  9. #29
    Join Date
    Jun 2005
    Location
    auckland New Zealand
    Posts
    5,236

    Default

    I'm unconditional on almost all of that Don yes. I initially optioned stuff but have since proceeded with purchasing. The more I research it the more I like the market. Growth follows infrastructure as you know and man is there some development going in in SEQ and the Coast.

    I consider it way less risky than buying house and land here at the moment.
    I don't think the market will tank here for long but the immigration into GC is such that it guarantees growth better than we will see here for a year or 2 at least.

    I think a lot of people are put off by what happened 20 years ago, but it's a very different market there now as long as you stick to quality.

    I think it's fabulous and I wouldn't recommend it unless I was putting my own money in there.

  10. #30
    Join Date
    Nov 2005
    Posts
    346

    Default Another question

    So, is an unsolicited letter of offer from an Aussie developer for $48,000 a 'kick back'?


 

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