Hi guys
Me and two business partners (close relation) are looking at the possibility of making some money through development. We are all quite handy and switched on, but we simply don’t have any real experience, so we are looking at doing something small scale, simple and hopefully not too risky to begin with.
I’ve been reading some posts here which make me think that perhaps townhouses may be too complex and expensive to get into right away, simply because of the planning involved and the cost of building. However, all three of us want to be involved, and probably need to be involved in order to get the money together to get started.
What I’ve seen a few people do is buy a block and build 3 smaller single story, sometimes joined, villas. I’ve seen heaps that look very similar, so I’m guessing you can reuse someone else’s plans to save money. Because these are single story buildings and very small areas actually join it should work out cheaper than building two story town houses. It may even be easier to get council permits?
Here is a typical example that I found at domain.com.au:
http://www.domain.com.au/Public/PropertyDetails.aspx?adid=2005003873&n=#Can anyone advise me on whether this type of development may be a good place to start? We all own property already so it’s just the actual planning, sub-division and building parts that we havn’t done before.
Might be worth mentioning that we already have a trusted builder in mind (who is related).
Any comments are appreciated..
Why don’t you start at the beginning and consider a spec home?
Can either hold it to secure the next project or sell it on completion to fund the next one.
Cheers,
Simon Macks
Finance Broker
[email protected]
0425 228 985Comments may not be relevant to individual circumstances. If you intend making any investment, financial or taxation decision you should consult a professional adviser.
Thanks for your input Simon
You’re right, starting at the start would really be to just build one house. However, unless all 3 partners went into the development as a joint venture there wouldn’t be enough capital to get the ball rolling yet. I’ve always been told that when developing as a joint venture it is a top idea to keep separate titles, so building just one house would probably only work if I did it by myself.
Your point is taken though, it would be safer to learn one aspect of property development at the time.
Carl_Vic
Unfortunately you can’t simply use someone else’s plans.
Town planning requiremnets for multi unit devlopments are very stringent and require that you draw plans that are site responsive and sympathetic to the neighbourhood.
If yo wnat to get some preliminary knowlegdge of how a development project is put together and the various stages, check out our investor learning centre at our web site which has some interestinga rticles and a checklist of what goes in to a development project.
http://www.metropoleprojects.com.auMichael Yardney
METROPOLE PROPERTIES
Author of Australia’s leading property e-magazine.
Join over 10,000 readers each month.
FREE subscription http://www.metropole.com.auThanks for your response Michael. I’ve read through the PDFs on your website and I’ve decided that I really need to do a bit more research/reading. Might be a good idea to stop by Borders on the way home tonight and pick up some reading material for the weekend..
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