Hi
I’m looking at completing a development of 3 residential villas in Perth. My Accountant suggested I find a builder that would be willing to do the development and be given one of the villas in payment.
Has anyone had an experince with this, si there anything I need to look out for? Any comments would be appreciated.
Also can anyone tell me what ‘B’ stands for at the end of a zoning eg R80B?
Cheers
RellieThat is a great idea…. we are thinking of devloping one of our properties next year and building 3 villas/townhouses too.
If you find a builder who will do this – please let me know….
Thanks, Mei-Lin
Rellie,
Why do that? You mention completing, so has the development started? If so, there is value you can possibly borrow against rather then give one away. Some more information is needed to be able to help.
Regards,
ErikErik Reurts
Micah Finance Solutions
http://www.micah.com.auHi Eric
No it hasn’t started. It’s just something I’ve been looking into. I’ve been looking in the Midland area. And before I bite the bullet I wanted to get as much info & research done as possible.
Cheers!
RellieHi Rellie,
If builders would do that – take one as payment – then it would save the hassle of getting finance to build…
I still think it is a good idea… I’ll look into it and ask some builders I have come to know.
Have you actually bought your place in Midland yet?
Talk soon
Meihi Rellie
what your account is recommending is jv using the builder and it is very common,
We do it all the time.
you will need a unit trust under a company and the builder is one of the unit trust members.
then when built the trust assigns as part of the deal one villa to the builder.
you need to talk to an account that knows trust.
but in essence there is nothing unusual in what you are asking and most builders will understand it (as most should already have done it in some form).
Jv are good and bad
good you spread you liability for the bank across more people but you also spread your profit.
and bad because you must know the other person or people you are dealing with and you are covering there liability also.
when doing the above you must put structures in place that limit your liability and risk management.
non of the above is to be seen as financial advicehere to help
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