Duplexes 6 & 7

[Rockstar]

What we plan to achieve:

To complete two duplex projects (4 houses) by Xmas next year.
Profit/Income target is 460k

Timeline

Purchase block 1 (Already under Contract Oct 31 - Jan 30)
Draw up Plans and lodge DA to council (Already lodged on Dec 5)
Sell 2nd unit of our previous duplex (About to go under contract)
Negotiate and purchase 2nd site (January)
Source finance sufficient for completion of both projects (currently exploring)
Lodge DA for 2nd project (late February)
Begin construction on 1st project (late February)
Settle on 2nd site (April)
Begin construction on 2nd project (late April)
Complete construction of 1st project (mid July)
Complete construction of 2nd project (mid September)
Organise strata subdivisions and sell 2 units (July - November)
Have a break for Xmas



Up until now we have only attempted one project per year. Doing two will require double the funds and demand more efficient organisation to maintain the flow of money and project management. This idea of two projects in a year has been intermittently appearing on my conscious mind for the past 6 mths so it's time to act upon the calling and throw some focused effort at the idea. We will soon see them materialise one way or the other.

I will post some figures when I get the chance.

 

[mattnz]

That's a great goal Rockstar. Excellent to see you have found a niche that is working well for you. All the best with your plans for the coming year.

 

[chindonly]

Great stuff Rockstar!

Quick question - how many hours a week would you average on these projects.

I am assuming you are generally hands-off....

 

[chindonly]

To clarify - how much time would you personally invest in each project. I'm thinking of some small developments myself soon...

 

[Shahin_Afarin]

Are you going through a project builder, private builder or doing everything yourself?

 

[Rockstar]

To clarify - how much time would you personally invest in each project. I'm thinking of some small developments myself soon...

I currently organise everything as well as project manage the construction phase.
Sourcing a site, negotiating contract price and conditions can vary though during this time I have a fair bit of free time available to do other things.

Designing both houses can also vary depending whether they are different floor plans or not. We have an architect doing our work now though I am still very much involved with the process.

For this project it happened pretty quickly. I had a call from the agent telling me this block had been reduced in price. It was 350k at the start of the year and came down to around 299k mid year. Then the call came through that they dropped it to 265k. I had a look over it and offerred 230k. Next day agent called and said they would sell for 240k. I told him I would go to 235k with the following conditions. They accepted my offer.

3 month settlement
2.5% deposit
permission to access site for surveying and pre planning
vendor to promptly sign documentation so we can lodge DA application during settlement period

The above negotiations took only a few days. Contracts were exchanged around 3 weeks later (Oct 30)
We probably had 3 or 4 meetings with the architect over a 4 week period to finalise DA plans. Say 6 hrs in meetings and 12 hrs mulling over plans myself
I did my own BASIX certificate - maybe 3hrs work
I did my own Statement of Environmental Effects - maybe 3 hrs work

Currently relaxing a fair bit which could continue up until we begin building. When we sell the house we are currently living in, we will step up search for the site for 2nd project.

My intensive work period is during construction since I am coordinating all materials and tradesmen. This normally lasts for around 4 months.
After buildings are completed we have to organise submission of Strata documentation to council and LPMA for registration. During this time the properties can be sold subject to registration of title.
If the properties are to be rented we do not need to strata the property and tenants can move in as soon as occupancy certificate is released by council.

You can engage a project manager or contract a builder to cover that intensive period if you are engaged in other employment. We did this for our first and second duplex projects. You can also engage a project builder if they have suitable designs. This avoids engaging draftsmen and architects.

 

[Rockstar]

Are you going through a project builder, private builder or doing everything yourself?

All ourself, my chippie has a builders licence which we are planning to pay him to use. Therefore we won't be able to use banks for construction loan. We may be able to source some bank finance for land purchase and we are exploring options at present. I have some potential private lenders who we may be able to negotiate mortgage agreements with. Have a fair bit of cash on hand to fund construction of at least the first project.

 

[Rockstar]

That's a great goal Rockstar. Excellent to see you have found a niche that is working well for you. All the best with your plans for the coming year.

Thanks mattnz, all the best to you too.

 

[Rockstar]

Ok here is my feasibility study for the first project. This block was quite a good buy during a weak market. It has some ocean views, 400m walk to the beach, 100m walk to the country club (golf and bowls), 300m to the shopping centre.

Land 235k
Legals and SD 3k
House 1 (3br) 180k
House 2 (2br) 120k
Council 30k
Interest 25k

Total Cost 593k

Final Value

House 1 500k
House 2 380k

Total Value 880k

As you can see, one doesn't require an accurate feaso when the margins are looking so healthy.

 

[Sheryn]

Ok here is my feasibility study for the first project. This block was quite a good buy during a weak market. It has some ocean views, 400m walk to the beach, 100m walk to the country club (golf and bowls), 300m to the .

Rockstar

go Rocky go!


Looked online at Street view after our phone call and I am sure you are on a winner as location and ocean views are rare to come by at a fair price.

We should be home in time to have a look through completed duplex 6.


Doing 4 duplex units a year will be a volume winner and quick profit builder.


Cheers
Sheryn

 

[chindonly]

I currently organise everything as well as project manage the construction phase.
Sourcing a site, negotiating contract price and conditions can vary though during this time I have a fair bit of free time available to do other things.

Designing both houses can also vary depending whether they are different floor plans or not. We have an architect doing our work now though I am still very much involved with the process.

For this project it happened pretty quickly. I had a call from the agent telling me this block had been reduced in price. It was 350k at the start of the year and came down to around 299k mid year. Then the call came through that they dropped it to 265k. I had a look over it and offerred 230k. Next day agent called and said they would sell for 240k. I told him I would go to 235k with the following conditions. They accepted my offer.

3 month settlement
2.5% deposit
permission to access site for surveying and pre planning
vendor to promptly sign documentation so we can lodge DA application during settlement period

The above negotiations took only a few days. Contracts were exchanged around 3 weeks later (Oct 30)
We probably had 3 or 4 meetings with the architect over a 4 week period to finalise DA plans. Say 6 hrs in meetings and 12 hrs mulling over plans myself
I did my own BASIX certificate - maybe 3hrs work
I did my own Statement of Environmental Effects - maybe 3 hrs work

Currently relaxing a fair bit which could continue up until we begin building. When we sell the house we are currently living in, we will step up search for the site for 2nd project.

My intensive work period is during construction since I am coordinating all materials and tradesmen. This normally lasts for around 4 months.
After buildings are completed we have to organise submission of Strata documentation to council and LPMA for registration. During this time the properties can be sold subject to registration of title.
If the properties are to be rented we do not need to strata the property and tenants can move in as soon as occupancy certificate is released by council.

You can engage a project manager or contract a builder to cover that intensive period if you are engaged in other employment. We did this for our first and second duplex projects. You can also engage a project builder if they have suitable designs. This avoids engaging draftsmen and architects.

Thanks Rockstar. Much appreciated.

 

[Shahin_Afarin]

How much are you anticipating the raw construction cost for the 4 dwellings?

 

[Rockstar]

How much are you anticipating the raw construction cost for the 4 dwellings?

Around 480k

One of the houses from the 1st project will probably become our ppor. We have a couple of private lenders interested in providing finance. One at 9% (500k) and the other at 7% (250k). WBC is currently assessing our borrowing capacity. Previous yrs tax returns are pretty woeful.

 

[Shahin_Afarin]

Wow ok - thats a good price. Keep us posted with the progress and good luck with the council!

 

[Rockstar]

We should be home in time to have a look through completed duplex 6.

As long as you don't get stuck out there on the Nullarbor

 

[Rockstar]

Wow ok - thats a good price.

That's because I am project managing the whole affair. I plan to use my chippies builders licence. If I was to contract it all out the cost for 4 houses could be up to an extra 200k.

Both projects are planned to have one 3 bed, 2 bath and one 2 bed, 1 bath house. I will post some plans soon for project 1.

 

[lizzie]

Very exciting for you! Will followed with anticipation

 

[Rockstar]

Thanks Lizzie.

Here are the initial concept plans and landscape plan.

 

[Rockstar]

House 1 plans and elevations.

House 1 is the dwelling at the rear. We had to design around a slope of 1 in 3 trying to maintain as much height as possible for the top floor in order to capture the ocean views. This house faces ENE.

 

[Rockstar]

House 2 floor plan and elevations.

This house is the 2 bedder and has garage and laundry downstairs. The deck faces NNE

I've also attached the site plan.