I’m about to put in an offer on a piece of land in Narre Warren in VIC.
The price is 330k and the vendor won’t consider anything less. It has permits for 2 4BR townhouses on it. Single garages only.
It is located 3 doors down from Princess HWY, next to a Medical centre with bus stops literally right at the front and a tennis school across the road. Walking distance to Fountain Gate Shopping Centre.
Spoke to Council and area is not prone to flooding. Is there anything else I need to consider before buying?
I’ve never bought land before.
The agent is pushing me by saying others are putting in offers. And when asked why vendor wants to sell he said because vendor has 5 projects and needs to free up cash. Lands in the area without plans and permits are around 270+ (but not so close to the shopping centre, and other amenities and without plans and permits).
Is this a decent investment? I’ve never built before. I am investing my sister’s money so have to be twice careful.
Please any advice is great.
Thanks
Take a breath, do your due diligence and don't succumb to the pressure of the REA. Especially if it's not your money at stake!
Cheers
Jamie
Jamie Moore | Pass Go Home Loans Pty Ltd
http://www.passgo.com.au
Email Me | Phone MeMortgage Broker assisting clients Australia wide Email: [email protected]
Suri – jump on the phone to your lawyer and get some help with the contract just as a start you are going to want:
- Contract subject to finance
- Time to get building tenders – turn key prices
- Valuations as is an on completion
Others will have more to add to this list there is a lot to consider.
Suri if land in the area is 270k without plans (that are big enough to fit 2 homes). IM telling you right now that buying a block of land for 270k and spending the money on the plans you are not going to be over 330k with plans.
It does not cost 60k for plans. At Maximum for a two house plan it could cost 5k-6k plus council application fees of a couple hundred dollars.
Even if you bought a existing home for 270k and demolished it for 10-12k plus interest and holding costs for 4 months whilst you got approval of 10k. That only equals 292K.
40k under if you offered the vendors "non negotiable " price of 330k .
Have you done a feasibility on it? Want to share what you think your numbers are? Obviously your buying with the intention to build and make a profit.
I had a look online and I'm pretty sure i know what block your talking about.
With a decent land size and overlooking what looks to be a park/reserve. You should look at the development plan of the local council to see if you could get more then 2 4br homes on there. Perhaps you could get 3 2br (or 1 3br and 2 2br homes). That option would be attractive for me. Most councils can give considerations for being next to open spaces and thus can give you lower block sizes and private open space. Ie if the standard POS (private open space) is 20% per dwelling they might let you have 10% or 15%.
Perhaps there is a better use of the current design. I think you should investigate it and perhaps get a building designer to sit down with you and say is it possible to get more then 2 dwellings on this block.
How long is your settlement period?
Have a look at number 69 Springfield drive. The 3 unit development there. You could do something similar perhaps…
Btw sorry i correct myself it wasn't a reserve just another person empty block of land.
Thank you everyone!!!
I didn't put in an offer after driving all the way down there and cutting my work day short. I didn't feel right about it from the start but I was succumbing to the push of the estate agent. Boy is he good.
But when I was sitting there, I realized building 2 decent townhouses would cost me around 220+ each. I wasn't going to make any money. Maybe if I was lucky, I'd break even.
So it was no deal.
I am going to make an offer today of around 285k (based on wilko's calcs) and see what comes out of it. If I get it good. If not, also good. There's plenty of fish in the sea
Hi Suri,
I guess sometimes its better to buy a property do some cosmetic renovation and then rent it out..
when building one really doesn't know which way market will slide in future if you are planning to sell.
But good luck with your search
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