Hey everyone!
I have found four great properties that I want to develop into Residential Townhouse sites. Although before I contact any of the land owners I want to make sure that the deals ‘stacks up’. My plan is to know where every dollar goes in the process and have total confidence how much profit will be in the deal.
The problem is I am having trouble finding out where the ‘Council Contribution Costs’ are found, (i.e water, roads, sewer). In other words I am looking for the fundamental costs that council charge when a new dwelling is built.
The Local Council replied via email to my inquiry explaining that they can’t give me the exact fees unless I submit an application. But all I want at the moment is an estimate. I was told that the information is housed in the town plan that is available on council websites, I’m going to make a phone call today to the council asking where I can find the information in the town plan but before I do, I thought I’d post on this forum. Because I have scanned through it but could not find anything.
Also if it helps I am from Perth, WA.
Thank you
Kind Regards
Ravi
bump
anyone?
There will be many councils in Perth. Which one are you dealing with?
By the sounds of this post you have no experience as a developer and this is likely to be too big a project to start with. I would suggest starting smaller.
Depends on number of dwellings and number of bedrooms. 20-25k per dwelling in QLD. But also depends on council. No idea in WA.
mattnz wrote:By the sounds of this post you have no experience as a developer and this is likely to be too big a project to start with. I would suggest starting smaller.Yes, it is true that I have no experience as a developer but a project like this will not be too big. This is because I won’t be the one who will be doing the developing. I’m pretty much a scout looking for deals. My job is to find potential developments then to do a feasibility, if the development is profitable I get the help from my business partner, who has the money and experience (hasn’t missed a DA in 10 years), and we split the profits at the end of the process.
Sounds like a great deal for you.
If your business partner has the experience in these suburbs, then they should understand the council costs.
They vary greatly around the country. In Gladstone where I am developing, the council costs are approx 5 times what they would be for the same development in Melbourne.
It hard to tell how much it will be even you are quite experience one. To subdivide a block of land to town house, depend how many town house plan to develop, zoning, council policy… ect.
First point of contact is town planner/surveyor. They can give you some ideal of YES or NO first. And it is also not certain. Some time NO can turn into YES depend how good the town planner sell the solution to Council.
Government fee and charge are just one part of total fee you need to pay. It can be estimate by talk to town planner.
Large chunk of cost is for the infrastructure cost. You will not have the figure until your team of engineer, architect, surveyor… do serious work on of your particular site. Example: below X number of town house on that site, you don’t need a transformer. You plan to create X+1 town house – add 100K for new transformer… There are different way to layout town house. Depend adopt solution, you can get extra 1 house or lost 1 house.
It cost serious money to find out the final figure base on design solution as all your team members need to be paid to do the design and research.
So even very experience developer still get burn as many factor unforeseeable.
Regardsmattnz wrote:Sounds like a great deal for you.If your business partner has the experience in these suburbs, then they should understand the council costs.
They vary greatly around the country. In Gladstone where I am developing, the council costs are approx 5 times what they would be for the same development in Melbourne.
I understand what you are trying to say. My business partner has told me what to do on two occasions, stating I can find the information in the town plan and to give the local council a call so that they could guide me through the town plan.
In the 30-45min spent looking for the costs I could not find any information and instead of calling I decided to email the council, but I didn’t get the answer I was looking for, I plan on making a phone call tomorrow.
I know it will be next to impossible to find the exact costs without submitting an application. But at this point in time I am just looking for an estimate. Surely if I provide the council with a property address and my intentions to develop townhouses they will be able to give me some sort of indication of what council costs will be involved and an estimate of how much. Right?
I assure you I am very grateful to have an opportunity like this
Any project you take on will take longer than you thought and cost more than you budgeted for, but will probably still turn a profit as long as the fundamentals are sound and the project funding is robust.
As for the council fees, front the planning desk, run through your scenario and they'll happily give you some imaginary figures.
And good luck with your endeavours.
Just an update.
I called the local council and I provided the address of one of the properties that I wish to develop and told them about my plans on developing townhouses on it. They provided me with the minimum lot size which was 220m2, which allows me to have a maximum of 9 townhouses on the vacant piece of land.
I asked ‘what costs would be involved building townhouses which were in relation to the council’, and the answer I got was that I first need to contact an independent builder and find out what their price would be for building the townhouses. Once I have that information they said to come into council planning department and they will be able to give me some figures. Exactly what christianb said,
christianb wrote:As for the council fees, front the planning desk, run through your scenario and they'll happily give you some imaginary figures.My action plan is to contact 4 or 5 builders so I can have the average price to build a townhouse. Also when I call the builders I think it’s important to make it clear that I am only looking for an estimate, because I think if I ask for a quote they will be a little bit reluctant to give me any numbers, that goes for the civil engineers as well. I am going to call 4 or 5 civil engineers as well as real estate agents to acquire the average civil costs and sale price.
Definitely won’t get a quote without plans.
Tell them what inclusions you want to have, aircon throughout, stone benchtops, construction materials, one or two storeys and ask for a per sqm rate on a turnkey basis for the build itself. Then make a further allowance for the civil works, including any retaining walls, stormwater retention tanks, fencing, driveway, letterboxes etc.
Some of the key things to watch out for when choosing the right block include:
– A gentle slope towards the road is ideal. This will keep your costs down when dealing with stormwater as it flows naturally towards the road. Too steep however and the costs will escalate to build retaining walls
– Look at the 1 in 100 year flood plan and make sure the property isn’t within the flood zone
– Try to avoid blocks with the sewer line (or other easements) running straight through the middle of it.
– Consider the placement of power poles when positioning your driveway, you dont want to have to move a power pole. Watch out for anything else which will be impossible to move to make the block useable, i.e. a bus stop outside the property.
– Find out if your council are tree huggers and what their rules are. If they are tree huggers, you may need to engage an arbourist. If the council are tree huggers and there is a 100 year old massive tree in the middle of the block, you may not be able to remove it. This can significantly impact the value of the block.You may find that it is actually a better option to go single storey with a smaller build due to the difference in building costs between one and two storey. This will also depend on the setbacks and FSR.
"My job is to find potential developments then to do a feasibility, if the development is profitable I get the help from my business partner, who has the money and experience (hasn't missed a DA in 10 years), and we split the profits at the end of the process." I think this sounds very much like Mark Rolton is your 'business partner' and you would then be placing an option on the properties.
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