Hi, my name is Mark and I am wanting to start out on my own as a Developer/Builder. Both my wife and myself have been working for Developer/Builders for the best part of combined 20 years, my wife as a contract administrator and me a project/site manager ( with Builders Registration), and have seen how much growth the owner of both the companies has enjoyed.
It is now our turn.
However, I am not really sure where to start. I would really like to resign from my current position of project/site manager and form our own company and move forward from there. I am sure that it is not as simple as that though.
As far as equity goes, we own one house and have a mortgage on another. I don’t know if that would constitute enough for a lender to look at us seriously.I understand that there are a number of fees and costs involved in the development side and when starting out without a positive cash flow I am not sure where this money could come from. Then of course the funds required for construction.
All while this is happening there is no income coming in.
Do we need to have $$$cash in bank to start with or is there other avenues we can pursue?
We have set our target as a small 3 villa ( triplex site ) to start with, in a up and coming suburb in Perth WA ( market research pending).
You’re likely going to need to remain in your job to show sufficient cash flow for the development – at that small size a triplex can be done on residential rates, which is going to be a lot more cost effective than commercial lending.
Perth market – that’s an interesting one. Ensure you factor in values post development, as a number of perth development sites are in a spot of trouble at the moment from declining values + from increasing supply from all the development across the city.
Corey Batt | Precision Funding
http://www.precisionfunding.com.au
Email Me | Phone MeInvestment Focused Finance Strategist - servicing Australia-wide
Thanks Corey, I have been doing a lot more research and you are right on both counts.
Will keep reading this site, it has lots of good info and asking questions. I think for a start we will try and find a positive cash flow property and move forward from there.
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