Hi there,
i’m totally new to the forum and generally being from the Uk I’m somewhat clueless! The question I have revolves around the subject of splitting an existing property in two in order to achieve a greater overall rental and increasing the potential for positive cashflow. Obviously considering the cost of the division when calculating the COCR. My question is what type of property lends itself to being subdivided? I have seen lots of properties but find it hard to see how any can be divided easily!Hello Startyoung,
I am trying to get a feel for what you want to do regarding subdivision. Are you looking at buying something established and building another dwelling on the block?? Or are you looking at purchasing a vacant block of land and doing further subdivision??
Anyway, I am not that good with the numbers but in regards to existing property first I would look at the section 32 of the place you are interested in to make sure there are no restrictions on further subdividing and if there are others being done in the area is a good indicator. Check with council as well. Your local R/E may be able to provide help as they generally know areas intimately and corner blocks are very popular for dual access.
If you are looking at new estates, often they are restrictive in regards to further subdivision, however you may see potential unit sites on a land list, usually sold at a higher price. No matter what you do though, council approval is usually slow, and it is going to be a while before you see any positive cash flow if your looking at construction. Here’s a thought, are you looking at buying established and selling the back yard?? I have noticed a bit of that going on lately!
Anyway, I hope I have given you a little more info than you already had.
Gracey
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