I have identified a number of large lots for sale in inner suburban Melbourne that are begging for subdivision and redevelopment. One in particular has a livable 3BR house that could be refurb’ed for $50k and sold for $5-600k, with a massive backyard crying out for a townhouse development (say 3 BR) on 500sq.m. Construction cost may make redevelopment prohibitive. Can anyone give me a ball park feel for a construction budget on an average 2 story townhouse? I am guessing 2-300K? If I just sell off the excess land I reckon there’s $125k to be made = 80% cash on cash return. Anyone have any insights?
Ta.
For simple construction costs for Townhouses we are finding we allow around $1400 / Sq M and that is at cost with a partner who is Builder.
All depends on the quality of course but for a nice 2 storey Townhouse i think you are probably looking at around this sort of figure.
Then of course you have all of yoru soft costs.
Richard Taylor
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