i just bought a 850m2 block of land zoned high density with a decent (but old) house on it, just on the outskirts of the CBD. im currently eyeing off the nextdoor property as its in similar condition and has a yard of similar size. if i manage to somehow convince the owners nextdoor to sell it to me I will then have around 1600m2 of land zoned high density. lets just pretend for a minute that that has happened.
im pretty new to the whole investment game and im thinking longer term, not straight away. but if in about 5 years i decided to knock down both houses and build 2-bedroom townhouses around about how many would i fit on a block of land this size? or would i need to know more about the zoning of the land? i havent done any research yet – im just throwing ideas around with my husband. thinking about whether its a worthwhile avenue to research.
even if i didnt end up being able to purchase nextdoor i would still knock down this house in about 5 years. at the moment as it stands itll get me $380 in rent a week which is majorly cashflow positive (as i purchased it for $250k) so i dont want to knock it down until my IP portfolio is bigger. maybe build a duplex instead.
trying to think of the best way to capitalise on this great block of land thats all.
Karen, if you are interested in the block next door, don't make the approach yourself. It is better to get a third party eg an agent to make enquiries with the occupant/owner because by showing your hand you are likely to be hit for a higher price (as you have more to gain from the purchase than a newcomer).
It would be best to visit the councils website to get the LEP for your area to determine what you can build, as well as any building standards which may apply. A local agent will be best to advise whether 2 bedders or larger are in demand, don't commit to a design before you know what will reap the greatest rewards eg a mix of 2/3 bedders or what ever.
thanks for the advice. if we do make a move on nextdoor it would probably be in about a month after the renos are finished and we have tenants in. one thing to worry about at a time!
i was going to offer them the same price we just paid for our place, as we got it around 50k under market value (listed for $330k, we picked it up for $250k, houses/land such as this one are selling for about $300 – 310 at the moment). they may be wondering what their house is worth, and if i mention what i paid for this one, they may think theirs is worth the same.
i dont know if i could be that lucky but its worth a shot i guess. they most likely wont be wanting to sell, but it doesnt hurt to ask. i saw them yesterday when i was at the house measuring windows and they looked like they were in their 50s. maybe the kids have all moved out and they are wanting a smaller home, cos its quite large.
ill definitely take your advice about not making the approach myself – it makes alot of sence and helps to keep the emotions out of it. cos if they start telling me about how they lost all their belongings in the floods which went through mackay last year then id feel like a real mongrel getting their house for under market value, even if they are willing sellers. i wonder if there are any buyers agents in mackay and how their pricings work?
Hi Karen
I am a buyers agent. My commission would be about a third of an agent if they decided to sell to you because of my contacting them. If you want me to do this on your behalf drop me a line [email protected]
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