I am a builder and am constantlly looking for opportunities to spec small developments.
I have found that in the last 6 months vendors expectations for sites have gone sky high.
I have looked in country areas having a good rental demand hoping to on-sell as an investment, but the prices here are also unrealistic.
It seems that small development sites (up to 4 units) are priced beyond their development value. Anybody doing their homework would not consider them at the prices asked (and in some instances obtained). It seems to me that these prices are purely speculative and rely on ongoing appreciation.
The last time I saw this to this extent was in the early 90’s.
Is there a lesson to be learned?Roughly speaking what would it cost to do say a 4 unit development. 2 bedder type aimed at the older folk. How much land would you need? Would 1000 sq meters do?
If you want to reply off line floral[at]tpg[dot]com[dot]au
G’day Dennis…
I sure agree with your observation.
Naturally others won’t and that’s what makes a market doesn’t it?
I can only comment on the Canberra market at that time… it tanked in September ’94. With prices falling 25%.
Where abouts are you?
Billfromoz
Hi Bill,
I’m in Sydney but have looked extensively throughout the state.
Xyzzy,
Your question does not have a simple answer. The quality of the improvements, and consequently the cost, depends on the market at which you are aiming. the land size will depend on local guidelines.
Regards to both of you.G’day Dennis…
I own 4 acres land 30 min West of Yass, 55 minutes from Canberra on Hume Highway highway. If thats not too far for please call me. I have an interesting project.
Anytime..0419 636 449 or [email protected]
Billfromoz
Bill O’Mara
Dennis,
I think this is happening everywhere. I bought a 1012sqm block with house in a Brisbane suburb about 5 klms from CBD for $500K in April. Could now resell for $600K but long term plans is for 3 additional townhouses on site.
bribie
How’s this for prices gone mad. In South Frankston I was rung by an agent in March and offered a two unit site for $180,000. Story of my life, I waited a week and then it had already sold.
It’s back on the market unchanged but with permit for two units at $450,000 to $480,000.
This can’t go on!
How’s this for prices gone mad. In South Frankston I was rung by an agent in March and offered a two unit site for $180,000. Story of my life, I waited a week and then it had already sold.It’s back on the market unchanged but with permit for two units at $450,000 to $480,000.
This can’t go on!
How will anyone make a profit paying those prices? Will some silly bugger come along and pay that? Unbelievable[xx(]
Hi Enduser.
I agree with you. There is a land on cnr of Overton and Inglis in Frankston (approx 1200m2).It has a permit for 4 units (3 two storey + 1 single storey). Owner wants to sell it all for $450K. It went to auction in May and it was passed on at $365K. Now different agent and even higher price.
Is it possible to make money on developing site like this ? Its only 200m from the beach.
Considering taht units may sell between 250 to 300 K is this worth while ?dennis
If you would consider Qld we have a 809 sq M block with DA for 5 x 3 bedroom townhouses in St Lucia right next to the Uni which we are selling for $150K / site.
Cheers Richard
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http://www.fhog.com.auThere is no such thing as a problem.
Just a solution waiting to be foundRichard Taylor | Australia's leading private lender
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