hi all,
i am wanting to buy this house on a huge piece of land in melbourne and develop 3-4 units/townhouses.
i have never done developing althought i have invested in property before.
can somebody tell me the complete list of things which will cost me time and money and other things i need to look out for in taking on this project.
am i heading towards self destruction? is it worth it?
please give me direction as the auction is on pretty soon and i am so not prepared.You say just a few questions but then you ask for a complete list of expenses and is it worth it.
It depend….
What will the land cost.
Can you get 3 or 4 units on.
May I suggest you need to know all the answers before you go to auction, otherwise how do you know how much it is worth.
Sorry for the plug, but it sounds like you need a development project manager. Check out http://www.metropoleprojects.com.au
Our job is to assist you with all the answers, but I cna’t really do it on a forum like this.
Michael Yardney
METROPOLE PROPERTIES
Author of Australia’s leading property e-magazine.
Join over 10,000 readers each month.
FREE subscription http://www.metropole.com.auYou definately need to do some due diligence with regard to the number of units you will be able to get onto the land. In addition to Michaels points, you also need to factor in time to get the permits and holding costs.
Town planning is often a slow process, especially if the land is in an area where anti-development groups are active.
You can have a look at the zoning, overlays etc and read the planning scheme for the area at http://www.dse.vic.gov.au
Regards
AlistairBe patient!!!!!!!!!!
If the numbers don’t work don’t do it.
See an architect.
Pay for advise.
Run it by an accountant.
Be prepared to lose your house if you stuff up.
Resiwealth … Phil
haha nice tip resiwealth:
“be prepared to lose your house if you stuff up!”
GOLD!
Hey,
All the guys have told you to do your homework first, and I fully agree. Don’t rush, as they say, the deal of a lifetime comes up about once a week. You will be amazed once you start looking for them, how unspecial this deal you are looking at will turn out to be.
In the mean time, here is a good start to your homework. Note the dollars I have given are very rough, and will depend largly on location and project.
Diconnect utilities $1,000
Strata Fees $1,200
Council Contribution (Section 94) $10,000 per unit
Council App Fees $1,000
Building Levi $2,974
Land $???
Loan Stamp Duty $1,000
Building $1475 per m2
Land Interest $?? (on loan)
Building Interest $?? (on loan)
Surveyors fees $4,000
Strata consultants $1,500
Demolition $10,000
Landscaping $9,000
Reticulation $2,000
Communal services $9,000
Loan app fees $1,000
Artist Impressions $400 (to sell off plans)
Architect $20,000
Land Tax $1,200
Accounting & Legal $2,000
Closing Costs Purch $5% land value
Closing Costs Sell $1000 per unit
Agents Fees 2.5% of end value
GST 10% of end value – GST Paid
Quantity Surveyor $6,000Dan.
The most important thing is to make the most important thing, the most important thing.
Anon.
Hi Afghangirl,
I thought you might be interested in a book called ‘An Intelligent Guide to Australian Property Development’ by Ron Forlee.
I’ve just started reading it myself, so far it’s very good and easy to understand. You can get it online through the Aust Property Investor magazine online bookstore. Here is the link if you are interested:[biggrin]
http://www.businessmall.com.au/cache/header-18public__0-0.html?cache=no
Regards,Sharon
Af /girl
Same theme and good advise on this thread also mind you posted in 2005- now 2010 … hope its not the same property……….lol
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