Hello all,
we have recently found ourselves in a very frustrating situation: every time we see a good deal it is way above our (dual income no kids) borrowing power.
So if you feel the same way, PM me.
Any suggestions on overcoming this without joint ventures would be highly appreciated as well.Getting finace should be the least of your troubles. If you were serious about property you would have the finance. Speak to several brokers, banks and smaller lenders. Preferrably a broker. How much is the deal worth? Is a bribe or something like that in order to sweaten the deal for he broker?
jamiedellam wrote:Getting finace should be the least of your troubles. If you were serious about property you would have the finance. Speak to several brokers, banks and smaller lenders. Preferrably a broker. How much is the deal worth? Is a bribe or something like that in order to sweaten the deal for he broker?well, we are still pretty much newbies, so how could we get finance for something like this:
– land (~3000 sq m) in inner XXX suburbs is being sold for $1-3M
– at the moment, townhouses in there are selling for $400K – $800K, depending on specific property
– so basically, what we want is to buy a land, subdivide, build and sell (maybe keep one for ourselves)
Now, let's say every townhouse would cost $250K to build; we think that 7 or more need to be squeezed in if we want to make a profit out of it.
Of course, once they are sold we are going to pay all the finances off; but it could take a year until the houses will be build;
And obviously, the interest repayments alone are way bigger than our income, so we don't have enough money to pay the interest until then.
That's why we are thinking about joint ventures; we want to split the interest/building expenses with someone.
Now, if there is any other way to pay expenses during this year? Am I missing something in all that?
Anyhow, thanks for the brokers idea, we will talk to a couple of them when the working week stars
Financing a deal like is possible it just depends on how much deposit or equity you have in existing properties to offer as security.
Realistically you will need at least 20% of the land cost and construction costs to make the deal palatable to any lender.
Richard Taylor | Australia's leading private lender
Qlds007 wrote:Financing a deal like is possible it just depends on how much deposit or equity you have in existing properties to offer as security.Realistically you will need at least 20% of the land cost and construction costs to make the deal palatable to any lender.
Well, we don't have that much in equity so, back to joint venture question….
Have you thought of pre selling the townhouses at todays prices, throwing in a white goods package for people who pay a depoisit now and the rest on completion. If you pre sell enough town houses then getting a loan shouldnt be a problem
may I suggest that you start with something a bit smaller. You will learn all the requirements and still be able to sleep at nighthere is noting wrong with doing 3 x 300K deals rather than kicking off with 1 x 1M deal.
Just a thought
MickDont want to appear rude but If you pre sell enough town houses then getting a loan shouldnt be a problem it doesnt work like that.
You will not get 100% of cost + acquisition even if you had sold them in the current market.
Richard Taylor | Australia's leading private lender
Hi
I am interested in going over this with you – it could be beneficial to both of us. Could you email me directly [email protected]
Penny
– land (~3000 sq m) in inner XXX suburbs is being sold for $1-3M
– at the moment, townhouses in there are selling for $400K – $800K, depending on specific property
– so basically, what we want is to buy a land, subdivide, build and sell (maybe keep one for ourselves)
Now, let's say every townhouse would cost $250K to build; we think that 7 or more need to be squeezed in if we want to make a profit out of it.Looks like an interesting project, are you sure that you have all of the facts?
3000 sq meters of LMR land would equate to 1500m2 of usable GFA or around 13 townhouses at 115m2 each which equates to a site value of $100K each. Depending on where this land is, that appears to be very cheap if your information on saleable value of $400K to $800K (very large range leads me to believe you require more research in this area – better to undervalue than overvalue). So site value 100K plus construction cost $240K (should be about right) plus DA/BA and Council contributions(15K)holding costs ($34K), selling costs (15K), GST( 34K) and profit margin at 20% (80K) would mean that you must sell for around $520,000 each. If research of past sales does not reach this level then it is no bingo.The propery plan looks very interesting. Would you reply to me to my email [email protected] . Im interested in joint ventures
You must be logged in to reply to this topic. If you don't have an account, you can register here.
