Hi. I am looking at a purchase which has a DA approval for a 2nd home. The original block size is 1480. The battleaxe block at the back would be 850.
The front has a house with a granny flat attached and is returning a reasonable rent. The block has not been subdivided. I have never done this before and would
like to know what to consider when doing the numbers. I thought that I would purchase, leave the house & granny flat rented out at the front and have the 2nd home built and then sell it. Thoughts please
Hi Miccalady,
Welcome!
Sounds like an interesting property and worth exploring further in my opinion.
A due diligence clause would be a good idea. Also as you have never done this before engaging the services of a project manager would be a something to consider.
Consult a solicitor on the contract before signing but here is an example of a DD clause;
DUE DILIGENCE
a) This Contract is conditional upon the buyer being satisfied with any investigations in relation to the Property (in the buyer’s sole discretion) within 14 days from the Contract Date (“The Due Diligence Date”). If the buyer is not satisfied with its investigations, the buyer may terminate this Contract by written notice to the seller at any time before 5pm on the Due Diligence Date, whereupon the deposit must be refunded to the buyer in full without deduction.
b) This Clause is inserted for the benefit of the buyer and may be waived by the buyer at any time.
All the best.
Colin Rice | CDR Finance
http://cdrfinance.com.au/
Email Me | Phone MePerth Based Mortgage Broker - Investment Property Finance Specialist | E: [email protected]
Would be ideal to consult a Finance professional to determine your borrowing capacity plus appropriate loans structure both now and in the future depending on what route you decide to take.
Colin Rice | CDR Finance
http://cdrfinance.com.au/
Email Me | Phone MePerth Based Mortgage Broker - Investment Property Finance Specialist | E: [email protected]
Here is a quick reply – You need to consider the Subdivision costs (if a plan has been done) who did it? – Building costs plus costs of subdividing – Sewer, water, power, gas connections – council contributions, Surveyor and registration costs – driveway and fencing – just some of the things to consider
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