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Bryce Holdaway

03/11/2017
Blog post by Bryce Holdaway

Top 5 Considerations when Investing in Brisbane

Today, I want to talk about the considerations you need to think about if you’re going to invest into the Brisbane marketplace.

I’ve got quite a few friends who’ve got multi-million dollar property portfolios and their entire portfolio is made up of Brisbane real estate. So it’s a wonderful market to consider. But there’s a few things you need to think about if you’re an interstate investor investing in this market; things which are specific to Brisbane that you don’t often see elsewhere.

 

The first one is flood zones.

You need to be aware that there was a big flood in 1974 and there was a big flood in 2011. A lot of houses went underwater and in some cases, significantly underwater. So the Brisbane City Council has flood maps, which you can go and see if you’re checking out a property. It’s free, you can check it out and see if this property under water at any stage in the past.

In my view, as someone who helps other people buy into this market, I will not risk them in any way if the property has been underwater before — no matter how minimal the impact was. Because it’s important to understand that they’ve what’s called, “The one in a hundred year flood.”

This doesn’t mean it happens once every hundred years; it means it’s got a 1% chance of happening every year.

So if you think about 1974 to 2011 — that was about 37 years apart — so it’s important we know and understand where these precedent marks are so we can avoid this. You can find some really wonderful investment grade properties outside of the flood prone areas.

So my number one consideration is to make sure you consult the flood zone maps.

 

Number two is the lifestyle in Brisbane.

It’s unique, it’s very laid back, so you need to understand what the locals want rather than imposing your interstate paradigm.

For example a carport is totally fine in Brisbane; whereas in Melbourne you want a lock up garage and in Sydney you want it to be locked up too. In Brisbane a carport is totally fine. In Brisbane you need an air conditioner because the heat can be intense, particularly the December, January and February period. Also know that the beautiful period home — yes, they’ve got scarcity and everyone loves them (Read Why do Character Homes often get the best Returns?)— but in Brisbane, you’re going to have a lot of maintenance because the sun is harsh on the building materials. So it’s important you understand the quirks you get in this marketplace. Therefore, don’t impose your interstate paradigms, relevant in a different market.

 

The third consideration is the main two drivers in Brisbane are the proximity to the city and the proximity to the river.

They don’t have that “traditional western suburbs feel” because if you think about the Brisbane River, which runs through the city — some of the best suburbs are in the west on the river.

So it’s not as if it has that “West and East Stigma”.

But it’s important to know that you don’t go to Brisbane for a beach lifestyle. And that’s in your mind — you think, going to Queensland is all about the beach. But Brisbane has Moreton Island, North Stradbroke and a bit further North, Bribie Island, which actually shields the surf coming in. So it’s really a sort of mudflat region on the coast near Brisbane. It’s not as if everyone’s flocking there — what they’re doing is they’re going up to Caloundra on the Sunshine Coast, which is the first you get when you go north, or down to Main Beach on the Gold Coast, which is the first real swimming beach when you go south.

It’s important to understand that considerations when investing in Sydney is all about the beach lifestyle; but in Brisbane it’s not about the beach lifestyle. Often it’s about the proximity of getting onto the arterial roads to get you to the Gold Coast and get you to the Sunshine Coast so that you can enjoy those lifestyle options on the weekend.

 

The fourth thing to consider is you should embrace the hills.

Particularly in the north it’s really hilly, but if you think about the climate they have there — they really want to embrace this. Because they want the breeze coming in to help take away some of the heat. Everyone loves a really great outlook and it’s a real outdoor lifestyle, particularly in those non-sweltering summer days. I mean, in the middle of winter, it’s still beautiful weather there. So it’s important you embrace those hills; but be aware you avoid living areas that get that westerly sun because it’s really scorching in the afternoon. You’ll notice as you drive around Brisbane, particularly on the western side — they’ve got a lot of shutters over the windows to protect from that sun. And be particularly careful when you’ve got a property that has a westerly aspect looking at water — because as that sun goes down, the bounce off the water straight into the property is really, really intense.

But for all intensive purposes, in Brisbane embrace the hills because it’s part of the lifestyle.

 

The last thing for me to consider is, it’s one big City Council.

Greater Brisbane is one City Council. Whereas if you think about Sydney and Melbourne and Perth, you’ve got a few suburbs in one council, and a few suburbs in another council, and what you can do in one suburb might be vastly different to what you can do in the other suburb because the councils have different rules.

It’s actually a real advantage in Brisbane because you’ve got, typically, a similar set of rules. So it’s not as if there’s vastly different things you’re allowed do in each suburb — because the fact that they have one set of regulations and one council. So that is a real advantage, in my view, when you go into Brisbane as a marketplace, particularly if you’re looking for ways to add value to an investment property there. Because you can see what you might be able to do.

 

So for me, there’s a few things for you to consider if you’re a borderless investor — if you’re in Perth, Adelaide, Hobart or Melbourne and you want to get into this particular market.

There’s some considerations you need to have at the back of your mind, and make sure that you use that Intel when you’re buying property.

Right now Greater Brisbane has roughly 2.3 million people but it’s going to grow to about 4.2 million by 2050 so lots of people are coming into the market — so it’s a wonderful market to consider, particularly if you’re playing the long game. But bear in mind, too, of the few little quirks when it comes to investing in Brisbane property.

 

 

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