Forum Replies Created
now THAT is an ad!!! [biggrin]
actually I am not interested in advertising on here at all and attend here purely out of interest, so I shall remove my web link in a minute.
http://www.megainvestments.com.auExtensive list of ‘Off The Plan’ property available for sale in Perth.
John – 0419 198 856
comes back to ying and yang – we need balance!
http://www.megainvestments.com.auExtensive list of ‘Off The Plan’ property available for sale in Perth.
John – 0419 198 856
but you are right – it will rely on the substantial depreciation benefits and the high rents – $650 per week it is based on
http://www.megainvestments.com.auExtensive list of ‘Off The Plan’ property available for sale in Perth.
John – 0419 198 856
ooh – this is a bit close to advertising. good question tho, I will put together a year 1 financial summary (not allowed to do projection these days!) and post it on the Project Info page.
http://www.megainvestments.com.au
Extensive list of ‘Off The Plan’ property available for sale in Perth.
John – 0419 198 856
nominal terms you mean?
if you put $100 in the bank and 1 year later you have $100, it has fallen in real terms. But it is still $100 and hopefully you have $5 interest to kick in. same as property, except we are talking about rent. so a property that achieves rent in line with inflation rates is not going backwards in value.
gearing is the next consideration of course… but that is the decision of the individual.
http://www.megainvestments.com.auExtensive list of ‘Off The Plan’ property available for sale in Perth.
John – 0419 198 856
my regret of late is that I didn’t buy more properties over the last couple of years.
I have just thought of a person that would benefit from a house price crash – DMICHIE ! oh and another – my mate that sold 2 years ago when someone told him prices would crash (he sold his house for $240k, now worth $360k, spent 2 years on rent and the equity he had on a new car: “cmon crash, cmon crash… I know it will crash…)
http://www.megainvestments.com.auExtensive list of ‘Off The Plan’ property available for sale in Perth.
John – 0419 198 856
diasgree… if a property crash were to occur the ramifications would be far greater than this simplistic analysis. negative equity, people walking away from mortgages, tightened lending policies, employment (as a result of falling expenditure) etc.
take the group that wants to trade up – I am sure you would be full of confidence trading up as prices came down?! And to try to pick the bottom is near on impossible, which is what makes this sort of short term approach to property the incorrect strategy. If you are so good that you could pick the bottom, you would also be able to pick the top and hence wouldn’t be in the market when the slide started to happen.
The author has evidently missed the boom and I certainly encourage them to stop watching from the side lines and get in there. willing the market to move in your favour is a fruitless effort though. (I tried it with shares – can promise it doesn’t work!)
http://www.megainvestments.com.auExtensive list of ‘Off The Plan’ property available for sale in Perth.
John – 0419 198 856
Originally posted by Sailesh C:Hi
Around $1200 per sqm for townhouses these days so $180 to $200k is about right. Construction costs will vary between types of dwellings.
Your simplest type of dwelling is a low set brick and tile home and here you will pay under $800 per sqm for a decent turn key product. Prices increase as you go to a double storey and even more for a town house. Unit dwellings cost around $3000 sqm plus.
Having carried out numerous feasibilities on townhouse projects I have come to the conclusion that the only ones that can make reasonable profit out of these types of projects are builders or land bankers.
The vast majority of projects I looked at showed around 12 to 15% profit. I feel that you would to make double this profit for such a project to be viable.
You also want the higher return for the extra risk associated with such a large project as well as the longer time frames….although our projet manager managed to complete a townhouse project in Morningside in 12 months.
You need to be careful with your due diligence and ensure you have a good manager looking after your project.
Sailesh Channan
http://www.developersedge.com.au
“Helping you select,develop and profit from property”
it is for these very reasons that I believe townhouses present excellent value for retail buyers. I have been tempted to buy other peoples townhouses as I have seen some where I really believe they are being sold at or below replacement value. As you say, only a land banker or a builder could be making a profit on it.
Price objections by the public to the cost of higher density housing is a real problem for agents. Our society is so fixated on ‘more is better’ and the dream of the McMansion. Recently we packaged some 3×2 cottage lots that were a fantastic design but worked out being the same price as the 4×2 houses…. it all came down to the linear metres of the boundary of the house. Which was more suited to todays household though?
http://www.megainvestments.com.auExtensive list of ‘Off The Plan’ property available for sale in Perth.
John – 0419 198 856
Getting a tradeperson in WA is near on impossible – they can’t be bothered turning up for small repairs when there are thousands of houses to build. Would suggest getting hold of an asset maintenance company that may have their own handymen. Otherwise somewhere like Hire-a-hubby could do the trick.
The PM offers a lot more though than just co-ordination of maintenance. If the tenant stops paying rent for example, what do you propose to do about it?
http://www.megainvestments.com.auExtensive list of ‘Off The Plan’ property available for sale in Perth.
John – 0419 198 856
Depends where you are and the design, size and finish. I would use a ball park figure of $180 to $200k these days. 1 thing to look out for – talk to some local agents and see if the townhouses are in demand. Remember oldies don’t want stairs, so if it is an area with large blocks and full of oldies looking for low maintenance homes, you will miss a slice of the market. Townhouses also take longer to construct. Be realistic in your construction timeframes, allow up to 2 years for a townhouse.
http://www.megainvestments.com.auExtensive list of ‘Off The Plan’ property available for sale in Perth.
John – 0419 198 856
I think Michael Yardney was advocating 20% equity, i.e. the profit component of the development, so there’s none of your own cash left in the deal.
http://www.megainvestments.com.auExtensive list of ‘Off The Plan’ property available for sale in Perth.
John – 0419 198 856
Originally posted by redwing:Hi Marisa..went to http://www.whereis.com and had to keep zoooominng out to see where the heck it was…[biggrin]
Ausprop or anyone..have you heard anything about developing the area near Henderson?
John Roberts VALE looks to be doing well in the Swan Valley..
Lot’s happening in WA..hmm where to buy next???
“Money is a currency, like electricity and it requires momentum to make it Effective”
Count The Currency With This Online Positive Cashflow CalculatorRedwing – I don’t know a whole lot about Henderson, though I know they are looking at redeveloping thw whole strip from South Freo to the new marina at Coogee; Hegneys have previoulsy tipped South Freo to be the next Cottesloe. I have a saying that “Fremantle is close to no one”, but that’s just my personal opinion. If I worked down that way I think South Freo woul be a great place to live.
http://www.megainvestments.com.auExtensive list of ‘Off The Plan’ property available for sale in Perth.
John – 0419 198 856
sometimes I wonder… villa prices in Cannington seem to have jumped another 10% overnight. I think there may be a lagged response from increased building and land costs now filtering through. This really must slow down…. when I don’t know. And I want to buy everywhere!!
http://www.megainvestments.com.auExtensive list of ‘Off The Plan’ property available for sale in Perth.
John – 0419 198 856
ooh interesting Marisa – heard nothing of it! sometimes you can be so busy on the current stock you miss the new things on the horizon. will dig around
http://www.megainvestments.com.auExtensive list of ‘Off The Plan’ property available for sale in Perth.
John – 0419 198 856
https://www.propertyinvesting.com/forum/topic/16349.html
my understanding of the streategy is, in a nutshell, build a complex of units, use the 20% profit as your equity component, so refinance the whole lot and move to your next one. they will still be neg geared but you use your capital growth i.e. redraw equity, to live on and fund your living expenses.
http://www.megainvestments.com.auExtensive list of ‘Off The Plan’ property available for sale in Perth.
John – 0419 198 856
this project will be HUGE and is the only new city planned for Australia. expect to hear a lot more about this.
http://www.megainvestments.com.auExtensive list of ‘Off The Plan’ property available for sale in Perth.
John – 0419 198 856
Rob, I don’t recall you being so critical against Michael Yardney’s use of this approach in the developing Forum. I will go and have a look but it would be interesting to hear his comments as he has stuck it all on the line for this method.
http://www.megainvestments.com.auExtensive list of ‘Off The Plan’ property available for sale in Perth.
John – 0419 198 856
“The only thing keeping the AUD strong is record high commodity prices and a weak greenback.”
Yes it is a common misperception that Australian exports are primarily commodities. The currency does tend to trade in line with that sentiment though, demonstrated by the embarassingly low levels we saw a few years back when commodities were out of favour, tech stocks were in, and the world wiped the floor with the poor AUD to the tune of about 48c. It certainly was a victim of a strong USD. In 2002, Mining comprised about 25% of Aussie exports, virtually the same as manufactured exports. A further 20% was attributed to Services. The great news is that mining and agriculture combined did not even constitute half of our exports. But if someone knocks on the door and wants to pay a decent price for commodities, why deny them? It’s all extra money in the pot.
http://www.megainvestments.com.au
Extensive list of ‘Off The Plan’ property available for sale in Perth.
John – 0419 198 856
“Lemme see, the housing industry gets the first home owners grant, negative gearing, capital gains tax concessions, generous depreciation allowances etc etc. At least the poor bloody farmers are earning this country some export income!”
Actually that is all directed to the general public – mainly first home owners and the over taxed hard working middle class. Over taxed as we are busy subsidising minority interest groups instead of letting the market sort things out.
If you have to subsidise an exporter $2 to produce $1 of exports then there is a waste of Australian resources.
If you consider those items listed to be a subsidy of the housing industry, then you would need to consider the GST exclusion on staple foods to be a subsidy of farmers as well (another on the list). how much is that little piece of Labor handy work costing the country?… the admin alone must be huge.
http://www.megainvestments.com.auExtensive list of ‘Off The Plan’ property available for sale in Perth.
John – 0419 198 856
what good is a trade surplus??? it means you have produced a whole heap of products and you havent been paid for them.
of course a floating exchange rate eliminates the problem anyway
http://www.megainvestments.com.auExtensive list of ‘Off The Plan’ property available for sale in Perth.
John – 0419 198 856
