Hi again,

Thanks for the feedback. I have used the ROI and CoCR methods of doing our numbers for this deal as outlined by Steve. The figures seem to stack up for us and could prove to be a good first time development opportunity. Our CoCR stands at about 174.9% with an ROI of 18.4%. We are taking Steve's advice in terms of aiming for developments that will generate about 20% becasue of being novices. We also plan to set up a trust to purchase this investment as we are one of the many whose finance structure is all wrong, so we are selling up our errors and starting afresh. Nerve wracking but very exciting! After speaking with the town planner, a local surveyor and several builders, we have budgeted for subdivision costs of $30,000 and build costs of $1400 per square metre (obviously among the many other costs involved). 

The thing that we remain confused about is Steve's example in his Master Class Starter pack that I purchased at his recent book launch. It stands as follows: 
Pages 55-56 of Masterclass Starter Workbook – Steve needs $66,000 cash to put down for deposit and closing costs on block of units & borrows the remaining $200,000. He then needs to pay cash for holding costs of $22,500 & borrows $70,000 for renovation costs. After selling all three units he expects to make a profit of $40,000. His cash back is $40,000 and his cash down is $88,500 making this a projected CoCR of 45.2%. All of these figures come from the workbook. Maybe for developments it is best to consider the ROI???. I understand CoCR is only one measurement but if it's a measurement of your cashflow isn't it one you want to consider fairly seriously?

I know I must be missing something here. If anyone can shed specific light on this example – especially if you have been using the workbook and Masterclass Starter Class to learn about this stuff, it would be greatly appreciated.

Many thanks,
Sharon