After several months of hacking away at it, we have bought our first IP. Great feeling but now to the nitty gritty.
How to go about the development.
I was thinking of an immediate reno resale on the front, why – my intial strategy was to get in and out quickly and then to move onto the next reno.
The sub-division will take 4-5 months just to get through council – as expected.
We thought we would have two developments happening at once but our first will suffice with five units to build.
I’m wondering with this option the new buyers will see a back fence which will be permitted but the subdivsion plan would not have been accepted at that stage. In other words the boundry would be proposed. Perhaps this will turn some maybe all buyers off and or lower the offers.
I’m now thinking we would be better holding off the reno and renting the IP until the building has been completed, then complete the reno resale.
What do you guys think?
Resale or wait?
P.S. The proposed rent return is healthy but not quite + $F.
[hair2]
Well done Larsont on your first IP.
I’m a little confused though, how can you sell the front house if the subdivision isn’t finalised? Your estimate of 4-5 months for a subdivision is perhaps a little tight. Maybe it would be best to rent the front house as is, with a quick tidy, and use the income to pay the loan while you process the subdivision and development. I think you’ll be surprised just how long each step will take, and 12 months will just zoom by.
AmandaBS
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The more complex the development the longer it has taken some of the people we have built for, but it all depends on how thorough/accurate your architect/town planner are with the drawings and submission. We looked at a 3 unit site recently and our planner said 3-4 months but that is in rural Vic. Must depend on the location if some areas take longer. If it is going to take 12 months I would be renting out the house while it all gets sorted.
Julie Fisher
Daryl Fisher Homes.Thanks for your comments.
Taking another look at it, renting the front house while the subdivsion and development take place sounds much more logical.
And, thanks for the reality check perhaps 12-14 months from begining to end is more likley .
The property is in country Vic, res 1 code.
Terry
Hi Terry,
Town planning takes a minimum of 3 months, more likely 6 months if it doesn’t end up in VCAT. If you have to go to VCAT you’re looking at more like 9-12 months. As long as you have a good designer and town planner 12 months would be a reasonable time frame to budget for.
Regards
Alistair
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