Brisbane Apartment's blog

Recent Popular Blog Posts about Brisbane Apartments

• Madison Heights, Bowen Hills
• Brisbane Apartment Sales Up
• Selling Your Apartment
• Soda Apartments, South Brisbane
• Brisbane house prices increasing
• Low Growth Conditions for Property
• Buying an Apartment off the plan

Recent Sales of Units and Apartments in Brisbane City

• Charlotte Towers, Apt 1504, 1 bed, 1 car, sold on 9 April 2013 for $410,000
• Felix, Apt 116, 2 bedrooms, sold on 30 March for $515,000
• Aurora, Apt 234, 2 bedrooms, sold at auction on 24 March for $548,500
• Charlotte Towers, Apt 501, 1 bedroom, 1 car, sold on 21 March for $415,000
• Skyline, Apt 61, 3 bedrooms, sold on 13 March for $710,000

Popular Blog Posts about Brisbane Apartments

This blog is not updated regularly.  See www.brisbane-apartment.com for more regular updates.

Some popular posts:

• Oversupply of Brisbane Apartments Coming?
• No Capital Growth for Brisbane Apartments
• The Oracle at Broadbeach
• Canvas South Brisbane
• The Midtown, in Charlotte Street in Brisbane
• Festival Towers
• Riverpoint and Flow
• Capital Loss in Meriton's Soleil

Overall, it seems like a dangerous time to buy off-the-plan in Queensland.

Affordability

It is no surprise that Sydney is the most expensive city in Australia for housing.  Brisbane apartments are some of the most affordable real estate in Australian capital cities.  This suggests to me that prices for Brisbane apartments may soon rise.

Sales in Charlotte Towers, Brisbane, 128 Charlotte Street

Looking at the four most recent sales in Charlotte Towers (as set out in government records) located at 128 Charlotte Street in Brisbane, one can see that the original purchasers from Devine (the developer) lost money: 

• Apt 4403 - a very good two bedroom apartment, purchased August 2005 from the developer for $585,000, resold October 2012 for $560,000
• Apt 3010 - purchased October 2004 from the developer for $380,000, resold October 2012 for $365,000 to well known Brisbane property investor Sarina Russo
• Apt 3705 - purchased September 2004 from the developer for $374,000, resold October 2012 for $350,000
• Apt 3007 - purchased from the developer in May 2006 for $533,000, resold February 2009 for $485,000, resold again in September 2012 for $497,000

As can be seen from the above, every purchaser from Devine who purchased off the plan made a capital loss.  The losses are greater than those shown above once stamp duty and agent's selling fees are taken into account.

Charlotte Towers was developed by Devine, at that time run by David Devine and Ken Woodley, who now run the Metro Property Group.

Brisbane Apartment Sales in September 2012

Recent sales in September 2012 in Brisbane:

• Riparian, 71 Eagle Street, 3 bedrooms on level 44, sold for $2.3 million
• Charlotte Towers, 128 Charlotte St, Apt 1903, 2 bedrooms, 1 bathroom, sold for $465,000 (after being on the market for some time)
• River City, 79 Albert St, Apt 2706, 2 bedrooms, 1 bathroom, sold for $420,000
• River City, 79 Albert St, Apt 2106, 2 bedrooms, 1 bathroom, sold for $430,000
• Admiralty Towers One, 35 Howard Street, Lot 110, 2 bedrooms, 2 bathrooms, sold for $535,000
• Roma Street Parklands, Apt 6008, 3 bedrooms, sold for $1,220,000
• Riverplace, 82 Boundary Street, Apt 82, 2 bedrooms, sold for $645,000
• Casino Towers, 151 George Street, Apt 1604, 1 bedroom, sold for $347,000
• Festival Towers, 108 Albert St, Apt 3402, 2 bedrooms, 2 bathrooms, $495,000
• Aurora Towers, 420 Queen St, Apt 568, 2 bedrooms, $750,000

Meriton Not Doing So Well Selling Infinity?

Meriton Apartments builds more than 1,000 apartments a year – recently it has shifted its attention to serviced apartments, holding back nearly half of the apartments in its 81-storey Infinity tower in the Brisbane CBD to be offered as serviced apartments.  (A large number of apartments in the Soleil building remain unsold.)

Meriton boss Harry Triguboff says Chinese buyers are retreating from the market due to the high Australian dollar and uncertainty in China as its economy cools.  Triguboff says that in the last three months Chinese buying has subsided, replaced (in Sydney) by first-home buyers taking advantage of new state government handouts.

No one is sure why Brisbane did not immediately respond but it would seem that the severity of the state government cuts and the fears about what will happen to coal mining would have played a role. Again it is early days and addition a large part of the Brisbane building skills base is employed constructing the mines.

See Property Observer and Business Spectator 

Recent Popular Blog Posts About Brisbane Apartments

• Which way is the Brisbane property market heading?
• Falling Prices
• Interest rates down in Australia
• Predicition - Brisbane market to keep falling
• Roma St Parklands - recent sales
• Distressed USA - a reader's opinion
• The Most Significant Barrier to Housing Recovery
• Brisbane Downtown Census Data

Brisbane Median Apartment Prices - Useful Information?

You will often see newspaper reports that discuss rising or falling house and apartment prices by reference to the median sales price for a particular period.  For example, see this recent report from REIQ.  The median price is the middle price of all the properties sold in the defined period. 

If you select a different length of time to measure the median price, you get a different result.  For example, according to REIQ, the median sales price for Brisbane apartments (all apartments sold in the Brisbane local government area, not just downtown Brisbane) for January 2012 to March 2012 was $387,750.  The median for April 2011 to March 2012 was $395,000.

The median is not the average price.  

For example, if there were 5 sales in the period, for $2, $9, $1000, $1002 and $6408, then the median is $1,000.  The average for the example above is $1484.)  See also here and here.

The statistics only look at the properties that were actually sold in the period.  If the median changes, it does not necessarily follow that the value of any particular property has changed.  For example, if in one quarter, there are many two bedroom apartments that are sold, and in the next quarter, there are mostly one bedroom apartments that are sold, then the median price is likely to decrease.  If a new off-the-plan development settles in the period, then the median is likely to increase for that period and decrease for the next period.

So how reliable are the recent REIQ statistics?  I had a look at a number of the more larger, upmarket and top end apartment buildings, and there are no or few reported sales for the relevant period (January 2012 to March 2012).  For example:

• Admiralty Towers Two - no recorded sales
• The Grosvenor - no recorded sales
• Quay West - only one sale, a 1 bedroom.
• Admiralty Quays - only one sale, a 1 bedroom
• Riparian - 1 reported sale, a 2 bedroom
• Metro 21 - 2 reported sales (1 bedroom & 2 bedroom)
• Admiralty Towers One - no sales on direct riverfront side of building
• Fresh Taringa - no sales since October 2010
• Riva Indooroopilly - no sales in more than 12 months
• For the above, there were no 3 bedroom sales at all.

It seems that the larger and more expensive apartments are not currently being sold.  As a result, the median price will be less than periods where there are more of these apartments that are being sold.  That the larger or more expensive apartments are not being sold could be for a number of reasons:  (A)  They may be listed for sale, but not selling because the owner does not want to or need to decrease price. (B) These buildings have more owner-occupiers, who do not sell as often.  (C) If rented, the rents are good, and so selling for a lower price makes less sense than renting out the apartment.  (D) An owner who needs to sell may decide to rent the apartment for a short period, until prices rise.  (E)  There may be no buyers at the high end of the market.

So it is hard to determine if the apartment values have fallen for the kinds of apartments that are not often sold, and if so, by how much.  Also, the median price decease for Brisbane may be because of a change in mix of the apartments that are being sold.

Brisbane Real Estate Capital Losses

RP Data reported recently that Brisbane apartments in 2011 lost suffered a capital loss of 6.5% (when looking a medium sales prices of apartments that actually sold in 2011).

Let's assume Mr Investor purchased a Brisbane apartment on 31 December 2010 as an investment paying $485,000.  Assume that he borrowed 80% of the purchase price, including stamp duty.  Stamp duty is $14,850.  So the total purchase cost, including legal fees and bank fees, is just over $500,000. Thus, Mr Investor put in $100,000 of his own money, and borrowed $400,000. 

That apartment, if it went down 6.5% in value, is now worth $453,475.  That is a capital loss of $46,525. 

So Mr Investor has had an actual capital loss of over 46% in one year.  That is the risk of leveraging.  A small decrease in value means a large capital loss where there is a leverage situation.  (If Mr Investor had to sell, he would pay over $10,000 in real estate agent fees, making his capital loss even greater.)  If values decrease further, Mr Investor will be completely underwater.  I suspect that there are many apartment owners in Brisbane who have little or no equity left, especially those who have purchased off-the-plan in the last 5 years and paid too much.  The only saving grace is for foreign investors who may make a profit on exchange rate gains.

Recent Popular Posts About Brisbane Apartments

• Brisbane Apartment Capital Growth
• DoubleOne3 By Devine
• Failed Settlements At Hamilton Harbour
• Devine Hamilton Harbour Settlements
• Soleil Review

Sales Data for Recent Brisbane City Apartment Resales

Here are the recent reported apartment sales in the larger Brisbane downtown buildings.  Most of these sales closed in the period from late October to early December 2011.

Charlotte Towers

• Apt 2110, 1 bed, 1 bath, 1 car - $382,000

Aurora

• Apt 393, 2 bed, 2 bath, 1 car - $665,000
• Apt 236, 2 bed, 2 bath, 1 car - $515,000
• Apt 512, 2 bed, 1 bath, 1 car - $582,000

Festival Towers

• Apt 3401, 2 bed, 2 bath, 1 car - $475,000
• Apt 1707, 2 bed, 2 bath, 1 car - $440,000
• Apt 2110, 1 bed, 1 bath, ? car - $350,000

Felix

• Apt 356, 2 bed, 2 bath, 1 car - $505,000
• Apt 276, 2 bed, 1 bath, 1 car - $492,000

River Place (82 Boundary Street)

• Apt 302, 2 bed, 2 bath, 1 car - $690,000
• Apt 326, 3 bed, 2 bath, 2 car - $1,497,000
• Apt 231, 2 bed, 1 bath, 1 car - $423,000
• Apt 110, 1 bed, 1 bath, 1 car - $410,000

Skyline

• Apt 55, 1 bed - $320,000
• Apt 131, 3 bed, 2 bath, 1 car - $700,000

Admiralty Quays

• Apt 9, 3 bed, 2 bath, 1 car - $900,000
• Apt 67, 1 bed, 1 bath, 1 car - $580,000
• Apt 135, 2 bed, 2 bath, 1 car - $780,000

Admiralty Towers Two

• Apt 57, 2 bed, 2 bath, 1 car (103 sqm) - $660,000

No reported recent sales (last October to early December) in Casino Towers, Quay West or Admiralty Towers One.

 

Brisbane Apartment

This blog has moved to www.brisbane-apartment.com.

Some popular posts include:

• Buying off the plan from Juniper, which discussed Soul at Surfers Paradise
• 111 + 222 approved for the Vision site
• Soleil pricing not holding up?
• Brisbane sale volumes
• Charlotte Towers - recent sales
• Oversupply at Northshore Hamilton
• Two books to read before you buy in Brisbane or Queensland