Hi everyone – I am in the process of doing some due deligence on a potential deal in Qld. The deal is an existing house on a piece of land that is actually on two titles.
I want to apply for a realignment of the boundaries and build a new house on the back of the block.
Currently there is a tenant on a 12 month lease in the existing house. The tenants are only 4 months into their lease. Does anyone know what the legal implications are of subdividing the block and building whilst the tenant is still in occupation – after all when they signed the lease – surely they signed for the lease of all the property?
Any help or comments would be greatly appreciated [blink]
Thanks
AnnabelWith eight months left on the tenancy, I would guess that council approvals would take that long and you could sign up the next tenancy with conditions that suit you both. If they want to stay, perhaps you reduce the rent slightly whilst the building is going on to entice them to stay. Check with the RTA about it if approvals come through earlier.
We are hoping to do this ourselves within the next year or two and I have put some thought into it. Better to have tenants in situ with a slight reduction in rent than try to rent the existing house with a building site in the back yard, in my opinion.
Would love to hear other suggestions, Wylie.
Hi Wylie
Thanks for the response. I agree that having a tenant in place even at a reduced rent is better than having no tenant at all and trying to find a new one when there is a building site in the back yard.I still have to redo my numbers because at this stage the development is not looking as profitable as I originially thought.
Cheers
Annabel
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