Survey Strata Development and Associated Risks

Hi,

I am in the process of putting together a business plan for a lot approximately 6,000m2. The idea is to create approximately 16-20 survey strata lots and sell them as a house and land package, either 3×2 or 2×2 double storey houses.

As the owner of the land there are a number of options this could roll out:

• Having two contracts for the package, one on the land and one on the completed product. That way we could pre-sell the H&L packages and remove ourselves once the land has settled. Requiring little capital investment.

• One contract for the H&L package. This will require additional financing to construct all houses before settling.

• Selling the land only and allowing each owner to build their own house. (not sure if this is even possible)

Are there any other ‘roll out’ options others can suggest?

In addition, I would like to put together a number of associated risks with survey strata developments of this size. Risks such as:

• Not being able to get bank finance due to nature of development. (Too risky) hard to value?

• The ability to bond the common property?

• Timing of settlement upon completion of each individual house or the entire development?

• Restricting purchasers to utilise one builder only.

• Contracts falling over and leaving the builder out of pocket?

Are there others who have done this before and have a list of risks they could rattle off?

Any help would be greatly appreciated.

Regards,