Forum Replies Created
I do. And, despite Carly’s horrible reputation, material is very, very good. I am experienced property developer and learnt a lot out of it. Would be willing to sell.
It is very important which council is the land in. Some things which are Ok in WA, are no no elsewhere. Certainty with any development is a must, so you know that your plan/strategy have no obstacles. Talk to your council or local town planner first. Then look for the people with the same experience.
If you are prepared to walk away from this purchase, ask for another condition: if current tenants do not move out on the settlement, seller would pay your rent till property is ready for you to move in. Agreed amount to be taken out of the settlement proceeds.
Your seller can not have all in his favor. He also has to give something back.
Thank you Wilko 1, but it will not help because extract above is from the policy. And further explanation is from director of QBCC Insurance Services. We have all lodged the claims , and some have already been rejected. Ours is waiting for assessment.
We are obtaining the quotes to complete from another builders and quotes are coming in substantially higher than original contract. Making the project totally non feasible. If we could finance it , at all.
There is the option to lodge proof of debt with Administrator, however, it would take ages to get the funds, if at all. If builder is forced into bankruptcy, who knows how much and when creditors would get.
I suspect not much, knowing the builder’s situation.To start legal action against the system is possible, but it would take for ever. And we all know how costly it is.
Sad part is that majority of the so called developers, in this case, are Mums and Dads, developing in syndicates, and developments are structured in a way that each investor keeps a unit for investment purposes. Our units are also not to be sold and are in personal name.
This insurance is compulsory…. Leaves you speechless.
There is more: apparently, when new contract is signed for completion of the works, NEW insurance is payable. Currnet one can not be transferred from builder to builder!Last option is to JV with the new builder and give him one unit. It would mean a loss for us, but at least we will finish the project.
Hi SamBoy
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Have you looked at modular kit granny flats?
For example: emjaro.com.auHi Alex
Out of personal experience: all you need is a special condition in the contract saying that vendor grants you permission to lodge DA before the settlement, and , subsequently, signed consent letter from the vendor to be lodged with council. DA is attached to the property, not the owner.
If you get the option on the property, and subdivision is complete, you may (?) even be able to sell the units individually without settling. Such scenario is opinion only and has to be confirmed with the lawyer/RPIHi wilko1
Thank you very much for this information. I will definitely see how it can be implemented in the areas/councils we operate.
Just to clarify: if you have a party wall acting as boundary, middle line is a new boundary? Apparently Council is happy to proceed with survey plan endorsement without buildings being constructed, but are shown on DA plans?
Is development staged in that case?
Sorry for the ignorance, but the concept is great and I am trying to fully understand it.Wilko 1, this is great idea, if there is enough land. In most cases multiunit sites do not have enough land for subdivision and /or council will not allow subdivision to be done first for community title scheme. It is applicable for low density residential (individual housing zoning).
Shane 13, check it with your town planner and designer before adopting the approach. Or find another site where you could implement Wilko’s system.Bank of Queensland did one for us recently, for 5 townhouses, to be kept as rental properties. So, no presales at all. 65% LVR, including GST (usually not the case), because it is done in personal name. We are not GST registered. We do have development experience, strong equity position and serviceability without rental income. Managing the project ourselves. We have approached branch owner directly and presented our project ‘face to face’.
If you are in Brisbane, PM me and I can give you contact details, if you wish.
You have to know your costings in and out. And, it would be beneficial if you have at least DA ready, which would show that you do have a project.We were very happy with the director of PMC Property, Brisbane based. He used to work for another agency and has started his business since.
Out of my experience, it doesn’t matter. All you have to do is notify Council in writing and present proof of new ownership. DAs are issued for the property, not the owners. Often my clients come to me for construction documentation after they have bought the property with DA in place, issued to the old owners.
Just ring Council up and confirm.First you have to check whether existing house, when moved, would fit on the half of the block. In this case it would be approximately 10.2 m wide block and you would be creating two small lots. There has to be enough room to allow for boundary clearances. At the same time you have to check demolition/removal restrictions, if any. You can do that by looking up Council’s Planning and Development website, or consult town planner.
Then you do survey of the site and draw up subdivision plan. Engage town planner who will help you with all other necessary plans and paperwork and lodge it on your behalf. When DA approved, services have to be connected and all DA conditions met, before you can lodge your plan with Titles office for registration.
As for the costs involved, wait for someone else’s reply. Just don’t forget that infrastructure contributions would be payable for the creation of a new lot, approximately $27-$30K, on top of all other costs.
Hi Benny,
every development site with old house which has to be kept is challenging, to put it mildly. Majority of the experienced developers (who DO make profits) would stir clear from it. Or expect a bargain. Have you got any offers on it? If you can sell it for what agents tell you that you can get, sell it. It is purchaser’s task to perform due diligence.
You can always assess your options if dollars offered are much less of what you expect, because of demolition restrictions.
To assess development potential and put draft feasibility together, you really need at least basic sketch of what fits on the site. 126.5m2 available has to provide for garages, as well. Plus, converting the house in units would trigger requirement for more car spaces.
To convert old Queenslander into units is much more expensive than ordinary reno, because of fire rating requirements.
In situation like this sometimes is more profitable to subdivide the house and on-sell the remaining land, despite the zoning.
New City plan may give you that option now. If you have 800m2 (I am guessing), rear lot may be possible?Be aware that valuation is not always taken as for buy and hold purchase.
It is important to understand that most lenders would reduce valuation from MARKET VALUE to ALL IN ONE LINE VALUE, resulting in APPROXIMATELY 15% discount. It means that approved LVR of, lets say, 65%, is calculated fron the lower base. It is possible to find the lender who would look at full market valuation, but they are minority. And is also assessed on case by case bases, depending on: developers experience, equity, servicability etc.
I can give you a hand with architectural side.
Hi Jimmy
When you have approved DA attached to the property it usually moves the property to deveopment site area of marketing. Whether it would really increase the valuation depends on the market you are in.
However, reason for my response it is to warn you that Development Permit lasts for 4 years. If not taken (work done}, it simply lapses and in the future all has to be redone from the begining. It can be extended (usually up to 2 years), but it depends on the Council.
Also, it is much more involved in obtaining the DA then just filling a long council form. You really have to talk to somebody who can give you a whole info on the process and costs involved. Experienced surveyor is a good starting point for a small subdivision.
I am an architect and a developer. The way how we see it (my husband and me): for us the main thing is to get TDC (total development) costs down as much as possible. So, for me it makes sense to do design and related architectural work free of charge, for myself and my family. That way we need to come up with less $$ to make the construction happening. I get my fee out at the end (not literally), from increased profit margin. it all gets taxed at some point, doesn't matter when. In most cases we keep our developed stock, so my fee is built in, and never taxed. Will be in the future, trough CGT…
Developers do not get paid for due diligence … and it is time consuming process. It is all part of being a developer.
Financiers do not care if I have paid myself. It is ATo who may, because my fee would become part of capital base.
At least, that is how I see it.
I can sense some disbelief and rightly so! I don't know how to attach PDF to this comment (silly me!) to show you council's fees.
It is nice to hear that developments in other councils are easier to finance.
You can always visit Brisbane Council's website-its there.
Ballerina
Hi Shahin
We have actually paid less, because our DA was approved before 2011 and we were given a discount. After that, Brisbane City Council has removed all discounts and for DAs approved in 2011 full amount is payable. In 2011 it was $26k/three bedroom dwelling ($18K for two bedroom). I haven't checked fees for 2012/13.
We are currently looking for the next project, and infrastructure contributions make feasibility very hard to work.
And yes, Aloha, it varies from council to council. Brisbane council had a floods to deal with, and is in need of many $$$!
Most councils have fees published on their websites.
Ballerina
Hi Shahin
We have actually paid less, because our DA was approved before 2011 and we were given a discount. After that, Brisbane City Council has removed all discounts and for DAs approved in 2011 full amount is payable. In 2011 it was $26k/three bedroom dwelling ($18K for two bedroom). I haven't checked fees for 2012/13.
We are currently looking for the next project, and infrastructure contributions make feasibility very hard to work.
And yes, Aloha, it varies from council to council. Brisbane council had a floods to deal with, and is in need of many $$$!
Most councils have fees published on their websites.
