Forum Replies Created
Hi Dougie,
There is a guy called Chris Lang who puts together small syndicates to buy commercial properties, he has a free ebook on the subject on his web site http://www.gal.com.au.
Regards
AlistairHi KALTS,
I have pm’s you the contact details.
Regards
AlistairHi KALTS,
Have a look at Mt Isa, its a large town that is really moving ahead and still offers quite good cashflow. I have a couple of clients who are developing up there, I’d be happy to put you in touch with them if you are interested in the town, they are a wealth of knowledge.
Regards
AlistairHi Tammekand,
You simply won’t get a good quality commercial property at that price with a 10% yield, or anywhere near it. If you want to go down the commercial road, get yourself some good quality advice. If you let me know which State you are in i would be happy to refer you to a knowledgable commercial buyers agent in your area.
Regards
AlistairHi Damien,
I would suggest you make a time line of how frequently you wish to purchase your subsequent IP’s do an analysis of how much you can save in between, and consequently how much you will need in the bank. You need to align your available cash with what you will require to complete the purchases.
If you can put 20% into the first property (to avoid LMI) and put the rest into an offset account. If this means that you will have a cash shortfall for the next property put in less and pay LMI, again put the balance into an offset account. The basic reasoning behind this is that you don’t want exxcess capital tied up in properties with deductable interest.
Another factor you should take into consideration is when you will likely want to purchase a more permanent PPOR. When this time arrives you want to have as much cash as possible as the debt on it will not be deductable and so far more expensive than your investment debt.
I hope I haven’t confused you.
Regards
AlistairHi Sarah,
If you like that side of town have a look at West Footscray, it is pretty high up the list of the fastest growing suburbs, in terms of median price, over the last 10 years.
Regards
AlistairWhat are the other features of the loan ie interest rate, fees etc? A $1k furniture package sounds nice, but is not so attractive if the loan is going to cost you more than that compared to other 100% loans on the market
Hi Redfox,
The cost of town planning depends on the project, whether you employ decent consultants or go for the cheapest you can find, timing will depend on similer issues. For a simple dual occ development you can look at $4-5k for a good town planning consultant and probably around $7k for the plans. You will need some other consultants such as a surveyor, but these will not cost nearly as much. Minimum time period will be 3 months, more realisticly 6 months and as much as 12 months in the worst case.
You can do things far cheaper than this, but you will most probably pay in terms of an inferior end product, greater lead time and more chance of your application being unsuccessful.
Regards
AlistairI have a lender on my panel that will do 6 unit on one titleIf you are saying that you can do this as residential, frankly I don’t beleive you. Maybe at residential rates, but not as a residential lend ie same LVR etc.
Hi Therese,
Can you give a little more info on the type of units eg are they upmarket or are you looking to get them done as cheaply as possible. I have dealings with a number of buoilders and am happy to recommend one, but they are all suitable for different sorts of developments, depending on what you’re after.
Regards
AlistairHi JWN,
You can do substantially better than that in terms of both rate and leverage. The rate will be heavily dependent on the actual size of the loan and the Leverage that you want. You can get very good rates up to 70% quite easily, if you want to go higher there are a number of ways you can do it and which is best depends on factors, particularly how much higher you want to go, how strong your servicability is and how rate sensitive you are.
Sorry if this is a bit vague, but i would need more specific information to give you any further info.
Regards
AlistairI’m with LifeX (although I’m biased because I live in Bayside). There are some great secong choice suburbs such as Highett, Hampton East and Cheltenham where you can still get hopuses around the $400K mark. If you go further away from the City you get more properties in this price range.
Regards
AlistairHi Frank,
It is possible to build over an easement, you need to get in contact with the appropriate referral authority, this will depend on what type of easement it is.
I own a town planning consultancy and would be more than happy to get one of my planners to give you some assistance if required. Have a look at our web site http://www.town-planning.com.au for more info.
Regards
Alistair95% lo docs have been around for a while Josh.
Hi JRN,
I am not against selling property, but you have to take into account the cost of doing so and, looking foward, whether it will put you in a better position in terms of your net wealth. If you absolutely have to sell at a loss, then do so, this is a risk we all bare as investors and should be looked as a cost of doing business. There are other options as well such as selling on vendor terms, which would turn the IP’s positive.
Regards
AlistairHi TK,
In answer to your queries:
1) There is no minimum lot size, however there are requirements for car parking, open space etc that mean that in reality the lot has to be of a certain size. Having said this, a good designer will often be able to fit a dual occ on a block that a less skillful designer could not.
2) Not sure
3) Have a look at my company’s web site http://www.town-planning.com.au I would be happy to assist you.Please keep in mind that margins are generally pretty thin for this type of development in the current climate, so make sure you buy well.
Regards
AlistairWhat do you mean you are in a bad way. You’re doing bettere than most people and are in a very good position to invest. Just work out what sort of investment (ie commercial property, residential property, shares etc) you are most comfortable with and go for it.
A good site for info on commercial property is http://www.gal.com.au by the way.
Regards
AlistairI would consider council enquiries to be the first and most important piece. If they wont conisder a Development Application then the project would be delayed through concilliation.This and similar advice comes up as advice very often, it is not correct. Nothing you are told by a council officer in an initial inquiry, particularly if there are no plans for them to consider, means anything. Anyone considering developing needs a good designer/draftsperson and a consultant planner and they need to listen to their advice.
Regards
AlistairHi Steve,
RE Agents will generally price commercial property on a per square metre basis when comparing sales prices. Obviously the quality of the current tennants and their leases will affect this, but you are unlikely to get a great discount on unleased space unless there is a forced seller or the property is a lemon.
As you are new to commefcial property you might consider using a consultant to advise you on your purchase price, negotiating leases etc. I know a few such people and am happy to email you some contact details if you are interested.
Another thing you should be aware of is the very large difference in cost between different commercial lenders. This market is not like home loans.
Regards
AlistairHi John,
I am in Victoria also. I can promise you that in general you do require a planning permit prior to subdividing (I own a town planning consultancy by the way), and in most cases you need to have started building. The circumstances where this is not the case are generally in outlying areas where there are very large block sizes eg Paynsville (expect a fair bit of development in Paynsville in the pretty near future by the way, it has a lot of potential). Pretty much every subdivision in Melbourne will require a planning permit and I assume the same would apply in every capital city.
Regards
Alistair
