OK, heres my tale. I have a approx 1100m2 block in Sth Hedland with a "well loved" 1970s BHP brick and decramastic 3BR/1Bath 110m2 house on it rented to a major company. By well loved I mean the place needs a lot of work to bring it up to a good standard. I figure $100K would get it close, and add $2-300 pw rent to the $1200 I already get. Obviously a lot of land is wasted, its zoned R20 or 25 if I recall correctly.
My other option and the one I would prefer to run with is bulldoze the house and block and bring in a couple of quality transportables from Perth, say 4X2 or 4X4 cofigurations and split the block. Each house will set me back about $350K plus site works, bulldozing and extras.
I have been to Hedland Council and they really didnt seem to be much in the way of knowledgable but this may have been more the people I dealt with.
Anyone done this sort of thing before up in Hedland that can give me any sort of guidance as to how I should be approaching this? Im chasing up a surveyor firstly to do a full survey to let me know where things are placed so I can work out which house options I have and also the best options to subdivide the block. From there I am pretty much at a loss as to what is required. I would assume it would be putting in an application to actually subdivide the block.
This is all subject to my finance being approved but the bank is being a pain in the butt because they cant see past the fact that having 2 houses on the block within 4-6 weeks of bulldozing will actually make one large amount of equity. All they can see is the fact I will be bulldozing the house which means rent is gone and property is lower value…..lol. This is partly due to Hedland being the unique environment it is.
I think my best option to get this past the bank is going to be to put in a full proposal with costings, valuations before and after and rental returns before and after to pretty much overload them with information so they can make a more informed opinion on it.
Ideas and opinions anyone….
thanks
Tom
Hi Tom,
One of our Buyer's Agents have done a few developments up north, one of which is in South Hedland. If you want to PM me, I can pass your details on to him.
He's always keen to help.
Kent
Hi Tom,
Have you had any luck with advice on this Sth Hedland project or do any other members have experience with Sth Hedland development – specifically subdivision ?
I also have a 1,100m2 property in Sth Hedland which I'm currently awaiting approval on subdivision… keeping the existing house (rented at $1,800/week) while creating a new vacant block at the rear of the property.
What I'm hoping to do is firstly gain subdivision approval – then do the work required to create the new block – then have a valuer value the entire property again with rent unchanged in current house plus a new vacant block at rear. I would hope the new 600m2 block will be worth at least 300k while the front house should retain it's current value as the rent won't change and will still represent 10%-11% yield. (Valuations in Hedland seem to be based solely on 10% yield).
The new equity (approx 300k) will be used for deposit funds for bank on new construction (design, approval and building of new 4 x 2 property on the rear block) which will rent for $2k per week, In essence – I guess I'm doing a staged development – acquiring equity to keep moving forward.
That's the plan anyway… hope the bank see's it the same way.
Tom, have you found any goo options on the transportable homes you mentioned ? Obviously building costs in Hedland are incredibly high so like you – I'm looking for the most cost effective solution.
David.
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