Duplex Addict - Rockstar No.4

[Rockstar]

Here is a revised building budget combining both houses. Will repost this during the project as actual costs come in. The red numbers indicate partial payment of the budgeted amount.

Just had a quote (labour only) from my chippie for building of frames, trusses, soffit, cladding, windows, carports, verandahs, tie downs and fix out. Came in at 20k for the 2 houses which is less than I had expected. I think he sharpened his pencil after I told him another chippie I know was keen on the job. Just need to get a solid committment from him to give me priority over his other work at the time so we can knock them up quickly.

Had two boundaries of permanent fencing go up the other day which I will share costs with neigbours. These had to be done anyway - but putting them up now reduces my site fence hire costs.

 

[locko24]

Very informative thread!
Keen to see how it unfolds for you.

Suprising how you can save so much by sourcing the materials yourself! Do you get them all at one place, ie. Bunnings, or do you need to shop around to get that sort of saving?
Did you need to 'borrow' the kit home manufacturers plans to get an accurate materials quote?

Regards

Locko

 

[Rockstar]

Hi Locko,

I am sourcing quotes from a few places - and letting them know the fact! Ultimately I may go with one building supplier who can provide all the materials but I am still pricing them off against each other.

And yes, I did use the kit home plans for the materials costings as I paid them $350 to draft them up for me prior to DA lodgement.

 

[BV]

Rockstar
As I understand it an owner builder can only do 1 project every a few years.
Is this correct?

 

[Rockstar]

Once every 5 years for each individual in NSW. If you have a spouse, they can also do the same - so technically one every 2.5 yrs as long as the owner builders name is on the title. So if you wanted to use your over 18yr old kid to do more often, their name would have to be on the title for the house or duplex they build. Remember you have to have an intention to live in them .

 

[BV]

thanks guys

 

[Rockstar]

Received a letter from council yesterday to amend my plans as there were a few issues with my driveway turning circles and some other minor issues including a discrepancy between my house plans and the BASIX certificate which I quickly revised. Resubmitted the plans today so fingers crossed.

Have received 2 quotes for the house slabs. 23.5k and 20k. I then decided to cost out all the materials which came in at:

Concrete 30 cubic m - $6000
Steel and ancilliaries - $2000
Fill and metal dust - $600
Pump x 2 pours - $1000
Machinery - $400

Total - $10000

I then spoke with another concretor today who quoted me $20/sqm for supply of formwork and labour only.

235 sqm @ $20 = $4700

Total = $14700 (saving of 5k)

 

[jsoe]

Hi Rockstar,
thanks so much for this thread. so inspiring!
I have a few questions please.

Did you know that DA would just take 3 months before you bought the land?
Was it like a delayed settlement that you negotiated with the vendor? I see you were paying 8% interest on the balance.
Did you get separate loans for the purchase of the land and construction loan?

Thanks.

 

[Rockstar]

Hi Jsoe,

My previous Dual Occ DA's took 5wks, 8wks, and 9wks so I knew this one would be similar. 8wks is around the norm in my shire.

Settlement on the land was subject to my settlement of previous duplex (house 1) which was awaiting registration of strata. There was a deadline in the contract for the land after which I had to begin paying 8% interest on the land price (240k) if the strata was not registered in time - thus delaying settlement on the house. As it turned out, the strata was delayed so I had to pay 8% of the land cost for a couple of months. I lodged the DA prior to settlement with cooperation from the Vendor.

I only have a 200k loan over the land. Construction costs will be paid from funds available in my offset account for loan against my PPOR. Love the old WBC Classic Plus account.

 

[jsoe]

Thanks Rockstar.
My partner and I looking into similar duplex development or subdivision as our next step in Central Coast NSW. We have a fair bit of equity in our current PPOR and savings but we are so juvenile.
The golden question (what we can't work out at the moment) is, how much should we allocate out of pocket expense to fund this whole process? Could you please advise who we should talk to to give us an idea of budgeting?
Do you own these developments in your own name or under Trust or company? I heard tax could be a killer if its in your own name?
Thanks heaps!

 

[Rockstar]

There are many variables jsoe.

What is your combined income - borrowing capacity?
How much cash on hand / accessible equity do you have?
Do you plan to sell or hold after completion?
What is your background - ie: do you have any experience in building, planning, organising and coordinating projects, etc
Do you have the passion and the time to research, learn and develop new skills in this field?

My wife and I have always purchased and sold in our own name. The tax issue is complicated and depends on your personal income situation. I have looked into trusts but felt they are no real advantage for us and bring more complication and dependance on accountants to drive them. I like to keep affairs small, simple and managable. No plans to become a bigger fish because we are happy with our niche.

Keep asking questions on here, talk with your accountant, solicitor, broker/bank, council planners, real estate/buyers agents, builders, etc. Go out into the field and look at houses for sale, display villages and vacant land opportunities.

And finally, look closely at your personal goals and motivations. They need to be sincere, moral and based upon helping both yourselves and others in your endeavours to profit. Win-win. This way we can all maintain a clear conscience and grow in spiritual as well as financial wealth.

All the best

 

[Rockstar]

We have made good progress last week. Tree lopper came and pruned off some overhanging Hoop Pine branches before house began. Porky came for 3 days and did all my prep work for the sub grade of slabs. Stripped the grass, benched and rolled the pads, dug all the service trenches and backfilled after sparky and plumber had laid their pipes and tidied up the site. Surveyor came and pegged out corners of buildings.

So we now have power on and slabs will be formed up tomorrow after I finish setting up the profiles today.
Tuesday morning the underslab will be sprayed before plastic and steel goes in.
Council inspection on Tuesday afternoon.
Planning to pour the slabs on Wednesday and frames and trusses will be delivered Thursday.
Hardwood delivery for verandah and carport posts, beams and rafters delivered Friday.
Chippies will begin following Monday.

 

[Rockstar]

A few more progress shots. Been beautiful weather so far.

 

[Sheryn]

This looks like a good flat site - will be interesting to work out the cost difference between slab and bearers and joist construction, also the time taken to construct.


Cheers
Sheryn

 

[jsoe]

great progress Rockstar.

I know you didn't take out the construction loan on this project. But if I were to take out the construction loan, generally, do Infrastructure Charges, DA Process, and Sewer and Water connections to new lots, etc. can be consolidated into the loan? These seem to be the biggest initial costs you have to cough up.

 

[Rockstar]

great progress Rockstar.
if I were to take out the construction loan, generally, do Infrastructure Charges, DA Process, and Sewer and Water connections to new lots, etc. can be consolidated into the loan?

Yes they can if you have a fixed price contract with a builder who has quoted you for them in the contract. Getting a loan as an owner builder is a totally different story and I have heard that you won't be able to borrow much at all. Maybe only 25%?

 

[Rockstar]

Problems last night.

Sunday afternoon we set up profiles and stringlines ready for the concretors to form up this morning. Turned up at 7am to a disappointing sight. Someone had come in after dark and ripped out all but 1 of our profiles and broken all the lines. Fortunately they didn't rip out the little surveyors pegs that had marked the exact corners so I only had to redo the profiles and run the lines again. Took me around 2 hrs to sort it out. Pain in the butt though it could have been worse if I had to get the surveyor back in. So we managed to maintain our schedule for the day and now have the formwork up and plumbing pipes in place for spraying at 7am tomorrow. Plastic and steel will go in tomorrow as long as there are no repeats of vandalism tonight. I had security fence erected today so hoping it will act as some deterrant, Also informed the neighbours.

 

[jsoe]

Hi it's me again. you mentioned kit homes in the beginning. what are they? are they same as pre-built homes? i'm guessing they're more cost effective?

 

[Rockstar]

Smooth day today without incident last night. Spraying got done early and all prep work was done by early afternoon. Council inspected and we're all ready to pour at 7am tomorrow. Line pump will be used to place the concrete. Should be around 22 cubic metres for both slabs.

 

[Rockstar]

you mentioned kit homes in the beginning. what are they? are they same as pre-built homes? i'm guessing they're more cost effective?

Hi jsoe, the kit homes are no different than what I am sourcing myself as far as materials are concerned. The big difference is that the kit home company will calculate, order and deliver all of the materials for you. They also draft plans and engineering for council DA and CC. This is great for a novice who doesn't have the time or skills to organise materials and plans. It is by no means cheaper than sourcing the materials yourself as the company will charge extra for their running costs, sales staff, plan drawings, and service of doing the organising for you. These 2 houses were quoted by the kit home company for around 30k each (to lock up). I have sourced the same materials for around 20k - a difference of 10k. You need to ask yourself whether it's worth the money for the service.

Some kit home places, I believe, sell smaller pre-built units and deliver them to site. Never used them personally but they may suit for a small granny flat.