Do they work for you the buyer or the developer – always a good starting point.

MatthewM wrote:

I have someone in mind to partner with who is like me, he’s starting out. I am mostly concerned that at the end of a renovation project, I may feel that all the hard work was not worth it when I am only keeping half the profit.

There are a couple of other things to think about;

1. You are both new to property investing so mistakes will be made. A better situation is to partner up with someone experienced.

2. Its important to have a solicitor draw up a partnership agreement to put some framework around who is doing what in the partnership and for what reward. Believe me, everyone has the best intentions in the beginning but often interpretations and expectations can be different- and often people don’t realize this until there is an issue. You will likely have to revert to the agreement as the referee.

3. Re: not knowing if the work is worth only getting half the profit. If you are only doing half the work then this is not an issue if the deal stacks up in the first place. You should have a minimum return that you are looking for with each deal.

We renovated and subdivided this property recently https://youtu.be/Q9NBdTKGzFkand and have a few others lined up to do the same. You don’t need to build a house on the newly created block if you are subdividing the land. Are you subdividing or creating a duplex situation? And is the property on two titles or one?

If the land is one title and you want to subdivide into two then councils fees alone are $30k to create the new title. Then you have services connection fees and installation, driveway and professional fees – so all up the costs are around $70k. In the example above we saved the $30k council contribution fee as the block was already on two titles, so we simply did a boundary realignment.

For location of services use – http://1100.com.au/

For previous DA’s use – http://pdonline.logan.qld.gov.au/MasterViewUI/Modules/ApplicationMaster/default.aspx

Cheers

Chris

We’ve done a few and they have always valued at house purchase price + 100% of construction costs.

The first one we put together was in Umina Beach about 3 years ago – $305,000 + $105,000. The rent is $680.00 per week. The clients have just been offered close to $550,000 for it. Super funds are a strong 2nd hand buyer of these dual income properties as well as extended families + obviously investors.

The key is to do these projects in a rising market so you get the best of both worlds – we not doing anymore in Sydney and surrounds.

Houses……in Brisbane right now!!

Best of both worlds in Brisbane at the moment – i.e. around 5% yield on good blocks where value can be added.

There is a looming oversupply of units around Brisbane city so avoid those.

We have been buying houses in Brisbane from $300k upwards..

Cheers

Chris

Not sure about Starr Partners in Merrylands Cassie however, we are based at Norwest if you want to talk about pro-active property management. We manage properties as far as Blacktown currently to the west, Bondi to the East, Central Coast (North) and also soon to be Brisbane.

Regards

Chris White
http://www.pillarproperty.com.au
0438265226

Hi Guys Sunday mornings are always a great time to read and contribute to a few posts. To put my 2 cents worth in, an experienced buyer’s agent should: Have extensive knowledge – enabling them to advise their clients about the best areas and streets to buy in and at what price and also those to avoid at any cost. They also should know their way around buildings and structures and be able to guide you on any problems that may exist with a property, potentially saving you thousands. Have many industry contacts – enabling them to access good properties “off-market”. In my experience, properties that are dressed up and taken to auction fetch 10-15% more than if purchased off-market. Be able to negotiate a better price – most people are not experienced negotiators and pay 5% to 10% more for properties as a result of this. Real-estate agents treat buyers agents are experienced peers and are more straight talking and not as likely to try the high pressure sales as they do with the general public. Have the time to review dozens and hundreds of properties – anyone who buys property full-time can attest to the fact that you have to look at and review “hundreds” of properties to find the right one “at the right price”. The best way to see which buyer’s agent will deliver on all this is to interview them and also speak with their clients about their services. <moderator: delete advertising>.  If you already know it all, have many contacts and heaps of time then you probably don’t need a buyer’s agent. Cheers Chris

Hi Michael

Good luck with your adventures.

Have you got any research material on the vacancy rates in these areas, current levels of inventory (empty properties), take up rate per month and general direction of property prices?

The US Census publishes regularly on vacancies and home ownership – it would be interesting to see what is happening in the areas that you plan to invest.

All the best.

I looked at Point Cook (from the desktop) for a friend of mine recently.

The median house price is $430,000 @ July 2009 – capital growth has averaged 3.66% per annum over the last 5 years.

The median unit price is $190,000 @ July 2009 – capital growth has averaged -3.84% per annum over the last 5 years.

18% of the suburb rents, so an ok rental pool.

A quick look on http://www.realestate.com shows Point Cook is oversupplied with new houses, which is probably why prices are dropping.

Please note that most of Melbourne’s property prices are rising.

http://www.realestate.com also shows an oversupply of rental properties which will cause rents to drop and vacancy is probably higher than the Melbourne average.

If you were buying in Point Cook, just based on this data alone, you would have to buy “very well” and be prepared for some short to median term price falls, rent falls and longer vacancies. I wouldn’t recommend it to my clients unless we negotiated a bargain from a very motivated vendor.

Sorry, I noticed that it was for an investment property. (not sure what happened with my user name on that last post)

If you go to http://www.investsmart.com.au/ and click on houses or units for NSW and search by median; all suburbs in NSW will be rated by median price from the most expensive to least expensive. If you are after a property that is about average for the area look at all suburbs that have a median price of around $300,000. Something newer, you may need to check median prices that are about 10% – 15% below $300,000 (may be difficult in Sydney though). i.e. at $300,000 you then would be buying something that is superior for the area.

You can then check the postcodes to see which ones are for Sydney.

And then if you want to check the distance from the CBD or distance from any another area that may have shops and infrastructure you can use http://www.nowwhere.com.au/NTI/DistanceCalculator/default.aspx to check the (as the crows flies distance).

FYI, Brisbane presents a lot more options in this price range.