Around 50 people attended a free seminar on ‘Investing in property, Returns and Risks’ at CQU Rockhampton last week (March 29).

The seminar was presented by CQU Adjunct Professor of Property Terry Boyd, who told the audience that Central Queensland’s residential property market was weak.

Professor Boyd said it will be “a unique type of residential property that will give a good return over the next few years”.

He attributed this to “limited opportunities for residential investments because they rely heavily on capital appreciation to make them competitive with other investments”.

“Residential property usually gives a low yield on net income (about 4% pa) and this is an inadequate return unless it is coupled with high capital appreciation.”.

While the residential market is weak, Professor Boyd believes the market for Small Commercial or Industrial Property Investments is balanced.

“Because of the current growth in the regional economy, there should be some opportunity for commercial/industrial property investments.

“However it is essential to be selective and buy only property that is in high demand. Location will be very important and condition of the building is also important.

“The key question is whether there would be more than one interested tenant for the space. This type of property should provide a reasonable yield (say, in excess of 8% pa), but the yield will depend strongly on the risk involved and could be much higher than 8%.”.

Professor Boyd said the market for large retail or industrial property investments is strong.

There is currently a strong demand from institutional investors for substantial, well-leased properties to add to property trusts, funds or syndications. They will buy at low yields, but are very selective and rely heavily on detailed valuations.

Professor Boyd is a registered Queensland valuer and property investor. He has extensive experience as a property professional and as a senior academic.