Hi, we’re looking into purchasing a property (our first home) near Train station, University, shops, all approx. 5min drive out each way. The property is 3BR, 1 Bath, 2 Garage, 900sqm and they’re asking $350k.
What we’re trying to decide on the advantages between renovating (adding bedroom + bathroom) vs building another unit at the back while retaining the original front brick house?
Do you have any advice? Where/How can I get info on capital gain?
4BR 1bath house in the area goes for $420k+
3BR 1bath house in the area goes for $350k+, not sure about units in the block.You should talk to a builder first and determine how long applications take to get through council and also the likelihood that your’s would be approved. This will give you a feel for what can be achieved i.e. extra bedroom or possibly subdividing and building at the back (if this makes sense – rear lane access, battleaxe etc.).
Generally it would be better to sub-divide as you will have another property on a separate title that you can sell at some point in the future. It is also true in most cases that even though you have split the block in half the front property is snot suddenly 50% cheaper – usually it only drops up to 30% and in some cases it is worth similar to before. Go figure?
Life is like a box of chocolates – you never know what you’re going to get!
Hi David,
I think that you have half of the formula: you’ve worked out what prices the house configurations could fetch….why not use the same source to get unit prices, ( or talk to local REs) then
Go see the local council and see if dual occ is feasible.
hrm
if you can do the subdivision i would guess when you do the numbers the profit on the two units would be better.
also consider, doing the subdivision and then selling the land off to a builder and retaining the front to have a low-cost solution which takes the stress out of the game for you. You will probably find that this will achieve the best equity position in the shortest time if that’s what you are looking for.
Thanks for the tips!
Any suggestions on where can I get information on successful negotiation tactics?
Cheers!
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