Hi,
I have 2 properties in country NSW that aren’t providing pos. cashflow, but that can be subdivided. The old houses on them need to be knocked down. I’m not sure whether to build two houses and sell all four and then be cashed up and debt free or keep them and get the tennants to pay for the renovations, sell one which will minimise my original debts and go for the capital gain in years to come. I’ve read Steve’s first book but I already had the debts by then and am not sure which approach is best.Any advice for a first timer on this forum would be greatly appreciated.[confused2]Hi Mumdoo,
You have 2 great properties with alot of potential.
It all depends on the mortgages you have with the properties, is there a market for new duplexes in your area, are there any being built now if so how much are they for sale, Would it be worth to wrapp them or lease option.
Their is many factors to consider, although I like the idea of building them and then sell or atleast lease option.
Do your homework and you’ll see which is the best for you.
Cheers
Joseph Scarcella
prime real estate agents
property management specialists E: [email protected]Thanks Joseph for your reply. My mortgage is about $300k in total and duplexs are going for about $300k for each half. So I guess it depends on what a duplex costs to build. Any ideas?[blush2]
Hi Mumdoo,
There are a factors involved before you should even consider drawing plans, Does the block slope to the street you need to get rid off the storm water, this will basically determine whether your sites are worth doing this type of project.
If the block slopes away and into adjoining neighbour YOU’LL HAVE TO CONVINCE YOUR NEIGHBOURS TO ALLOW A STORM WATER PIPE TO GO THROUGH THERE LAND AND INTO THE ADJOINING STREET.
To give you an idea we had a property like this and the poor little old lady wanted $50,000 to pass a 300mm pipe down her side boundary so we could drain storm water.
SO, If your block does slope to the street and the council permitts this type of developement and you are allowed to subdivide (even if you strata them) the costing on doing a duplex does very quite alot although a rule of thumb would be approx $950- $1100 PER SM2 ie/ 170sm2 x say $1000 = Approx $170,000 complete although you should consult a builder there may be other cost as well.
I hope this has helped,
cheers
Joseph Scarcella
prime real estate agents
property management specialists E: [email protected][bonjour] Hi Joseph, thanks for all your help. Sorry i haven’t replied earlier but I haven’t logged on for a while.[buz2][biggrin][cigar]
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