INVESTORS are flocking to the Gold Coast to make a buck, with inflated rents guaranteeing properties will pay for themselves.
Gold Coast investors Brian Washbourne and David Bugeja have bought 18 properties in the past six months – four in the past week at Robina’s new Botanique development.
The business partners said they intended to keep buying “by the dozen” for another 18 months to reach their goal of 50 Gold Coast properties.
“We have only started buying in the past six months,” Mr Washbourne said.
“David and I thought seriously about it for 12 months and we thought the timing was right, so we jumped in and we will go hard for another 18 months.
“We have a lot of experience in investing.
“We had a few properties in Mackay when there was a huge mining boom but we have found that the Gold Coast has definitely become the next big boom.”
Mr Washbourne said he had lived in Robina for the past 20 years and jumped at the opportunity to secure the new homes to capitalise on the phenomenal growth tipped for the suburb.
“I think a lot of people know the Gold Coast is a great investment but some don’t have the courage to dive in just yet,” he said.
“My strategy is to borrow 56 per cent and pay the rest of the property value.
“David and I also use a unit trust for each property.
“We have found we would pay double in Sydney and not have the same return we have on the Gold Coast.
“We have a 5-6 per cent rental yield on the Gold Coast compared to Sydney which scrapes in 3-4 per cent.
“The properties on the Gold Coast are also far more attractive.”
Sydney investor Jane Evans bought a two-bedroom apartment off-the-plan in Robina’s Bohème Apartments.
“The market is very hot in Sydney, so you need to have enough cash to be able to get into it in the first place without mortgaging yourself up to your eyeballs, so for now I’m happy to be renting and investing elsewhere,” Ms Evans said.
Ms Evans said she made the right decision by investing in the Coast because of its lifestyle and job growth factors.
REIQ Gold Coast chairman John Newlands said the market had been in a healthy position for the past 18 months.
“It is quite probable that if an investor bought a home for $500,000 they would make around $500 to $550 a week,” Mr Newlands said.
“It is affordable compared to Sydney and Melbourne which have reached a point where they are too expensive and rents haven’t caught up.”
CoreLogic research director Tim Lawless said there was no sign of the Coast’s growth slowing down.
“The Gold Coast housing market has well and truly emerged from the soft conditions that were evident post GFC,” he said.
“Prices and buyer demand have generally been trending higher since 2012.”
CoreLogic data shows Gold Coast houses had a stronger overall rate of price appreciation, with the median house price up 5.5 per cent over the past 12 months and 16 per cent over the past five years, compared with the unit market where prices were 4.1 per cent higher over both the past 12 months and five years.
Mr Lawless said the most strategic places to invest on the Coast were close to the water and working nodes.
“Investment locations tend to be synonymous with scarcity and ongoing demand,” he said.
“Locations close major rental and working nodes are generally in high demand, however buyers should also examine how much unit supply can be introduced within proximity.”
Original Published: http://www.goldcoastbulletin.com.au/