Portfolio Property Investments QLD Tour

GLADSTONE CENTRAL QUEENSLAND.....

Okay here's what I think of Gladstone... Prices are a bit everywhere at face value (realestate.com, agents etc) which is synonymous with many regional centers in QLD. However when you dig that bit deeper you can see the consistency.

There are a few areas of interest:

1. Barney point and South: I looked at two blocks there yesterday. One had just sold, it was approved for 4 x 3 bedroom units. It sold for 410k and still had 100k of headworks to pay! That's nearly the same price I can buy a house block in other towns for which will receive great growth also. What greeted me immediately in Barney point was a group of locals drinking on the beach at 1pm! The council still own a lot of land obviously as they had commission housing in the area.

I think it's a great place for High density units (a lot of it is classified as high density already) however for houses I think that people will continue out west in the newer estates with all the new services and shops etc. The only agent that said that the demographics are changing in Barney point is a guy who owns a house there. None the less, in the long term I think Barney point demographics could change.

2. CBD: There are a lot of 2 bedroom units in 4/5 story buildigns being constructed with high volumes of sales around the $450,000 mark furnished. Rental returns of approx $650- low $700 are the estimates for these new ones. There are many more approved sites for developments like these and another 4 in council currently at an advanced stage.

Western suburbs: this is where all the new estates are and are still going, a new woolworths is going right on the edge of town also. The shopping out there is good (approx 10 mins drive from CBD) however if you don't work in the CBD you don't need to come in to it all the time. New house and land starts at $500,000 however the standards of these homes are very poor in my opinion. It seems to be around the $550,000 range for a good package which is Val/ market value still. Many people who are spruikng the $500k packages are saying you are getting it for $50,000 less. You're just getting $50,000 of less house and or land. A $550,000 house will achieve approx $650 per week rent currently, whilst furnishing it seems to be the way to go and achieving $800-$1000. Even up to $1200 if you want to get creative and spend another $50,000 - $ 70,000. some builders are really bad! Especially Vantage homes, they are terrible here and even the real estate agents here warn against them. I feel sorry for the people that have bought some homes based on hype, when they need to resell on the local market the agents don't even like the house so what hope do they have to get the best return!

I am concerned about the construction workforce still. It has always been my concern and it still is to be honest. In 5 years many employees may not be here. CSG has a very large construction workforce and a significantly lower long term workforce. And the reality is that a lot of people here are a construction workforce. Gladstone has had many peaks and troughs in history as influxes of construction workforces has coke and gone. However, of course it has always gone up in the long term.
There is a lot more land coming on the market, there are currently 4 large unit sites (40+) for public comment with council. I don't have a doubt they will all rent out. But in 5 years? I don't know and I don't think I trust it yet personally for a long term hold. Land has risen from $180,000 last year to $250-$280 currently. The main shortage or residential land is NOW. Which means that land prices could be at or near their ceiling.

The mining companies won't currently rent a house that is older than 5 or 6 years. This is the first time I have seen this as it seems to be unique with the Coal Seam Gas industries. I was also interested in buying an old house and subdividing the block and battle axing. However with strict council zoning for smaller developments this seems harder than previously thought. In light of this, not all rents will soar, only new houses or units. Yes I am sure they will all go up, but it won't be port headland where you buy a 3 bedroom dump and rent it out for $1000 +. this seems to only come with the new properties.

This is the short of it. Someone said to make my blogs small, however when it comes to property investing there is a lot of information to know about an area so sorry...they will be big however very informative I hope! I have nearly finished dissecting the CSG (coal seam gas) companies EIS's (environmental impact statements) which are about 1000 pages each and will give you my final verdict on Gladstone today!