Thanks Ryan…if I get the plans and permits approved before settlement then they will revalue right?

I'm planning on living there for at least 6 months to get PPOR and then look to sell or if possible develop…need a bit of extra equity!  

Hi everyone,

Thanks for all your advice. It has been really useful. I've decided not to go with apartments for many of the reasons that have been mentioned, in particular: keeping it simple given its my first project, financing for such a large project, resale (as there are a lot of apartments going up in Boronia in the mid term) and the 2-3 years it will take to get town planning approval.

I've decided to go ahead and get the plan and permits for townhouses and then sell the land with plans and permits (or develop if possible at that stage).

One question I did have – I've heard that some people do the following: Get plans and permits, get builder lined up, pre-sell the townhouses using two contracts – one for the land and then another contract with the builder for the construction. This way they get the money for the land upfront and also get a better price as they are selling individual townhouses as opposed to land with p&p to a builder. Apparently Knox council allows this as well. I'm thinking this might be a better option for me than just selling land with plan and permits.

Does anyone have any experience in this? Would love to hear your thoughts.

Thanks guys for the feedback. I'm meeting with Anz tomorrow and got a call into cba so ill definitely follow up on the great points you've raised.

Thanks for your comments Richard. I’ve spoken to a big four lender. The commercial lending relationship manager said:
– they would fund the project based on my model which was conservative and tied into her estimates. I told her it’s my first project and it wasn’t an issue.
– lvr 80% of cost and 65% of gross completion value
– presales of 50-70%
– line fee 1.75%, margin bbsy +1.75% – so all up rate of around 6.15%
– establishment fee 0.75%
So much closer to Wilcos estimates.

I’m meeting up with her next week to firm up my lending estimates. I’ll check with her again to make sure that I can still get finance even though its my first time.

Could anyone recommend a reputed builder and finance broker I could speak to?

Thanks Wilko1, I would sell most of them, maybe just keep one or two. I'll would prefer a high lvr at current interest rates and may need to pre sell more. There are a lot of units being pre sold in boronia at the moment so there is demand for 2bed apartments. The units would be a more feasible option and require less equity. You've given me food for thought, thanks for the costings too…any idea what it would cost per apartment to build 2 bed medium quality apartments?