House and Land package Perth

[perthguy]

I really had my heart set on a retain and subdivide for my next IP/PPoR (IP is the retain, PPoR to be built on the back block). However, the prices of these properties where I want to live has skyrocketed and when they come up they are selling in 24-48 hours!

So, I have been thinking about just picking up a House and Land package for my PPoR. For example, this one is in a great location: walking distance to a swimming pool, about 4 gyms, parks, bus routes to train and city, 4 supermarkets, shops, cinema... everything really.

http://www.realestate.com.au/property-house-wa-kewdale-115857627

My question is, what are they not telling me?

For example: LOT 701 - 300sqm - From $547,000

What doesn't that include? Or will be level of finishes be really basic? I know nothing about these. Basically, are they a rip off?

 

[MTR]

There will be holding costs during the build, just make sure you add this to the bottom line.

What I would do in the first instance is try to source your own land, this way you can shop the build. I did notice that there are some blocks for sale in Kewdale.

You will save money if you go this way.

Also, on realestate.com start searching areas that meet your criteria, land only and see if anything suitable comes up.

I think building is a great option, as we all know it will be hard to source the land. But I would work it real hard, start phoning some of the larger project builders, some of these guys source land closer to the city. There was a gem some time ago now in Yokine, I should have jumped on it.

Cheers
MTR

 

[perthguy]

I know you are right. I'm just feeling tired after a 4 month reno on one of my rental properties... mostly DIY.

I can get land. For what price I don't know. Anyway, suitable blocks come onto the market now and then. I know for house and land I am paying someone else to do the work I am fully capable of doing, so it's a bit of a cop out for me to do that. I guess I am just feeling lazy from being worn out.

I will check out some suitable blocks and talk to my mortgage broker.

 

[bashworth]

Many of these house and land packages are based on the worst blocks on a subdivision to get the cost down. (See http://www.anewhouse.com.au/2012/02/house-and-land-packages-are-they-a-good-idea/)

 

[perthguy]

Many of these house and land packages are based on the worst blocks on a subdivision to get the cost down. (See http://www.anewhouse.com.au/2012/02/house-and-land-packages-are-they-a-good-idea/)

The funny thing in the areas I am looking in is that mostly the blocks are still on the market. i.e. land: http://www.realestate.com.au/property-residential+land-wa-kewdale-200785791

h&l for same blocks... http://www.realestate.com.au/property-house-wa-kewdale-115900567?listingType=buy

There are blocks I am interested in. I just need to talk to my MB about arranging finance, work out the price, talk the to agents and look at the blocks. Not much!

 

[MTR]

The funny thing in the areas I am looking in is that mostly the blocks are still on the market. i.e. land: http://www.realestate.com.au/property-residential+land-wa-kewdale-200785791

h&l for same blocks... http://www.realestate.com.au/property-house-wa-kewdale-115900567?listingType=buy

There are blocks I am interested in. I just need to talk to my MB about arranging finance, work out the price, talk the to agents and look at the blocks. Not much!

Also as the blocks are quite small you will possibly be looking at building double storey home which will cost considerably more than single.

Another option, as you mentioned too hard to purchase a property where you can retain and build at rear. Why not just buy a property on decent parcel of land that needs a minor reno.


I would be looking at areas like Mirrabooka, close to city and as cheap as chips and it has dramatically changed over the last few years. This property wont break the bank and looks very good. Look at surrounding areas much more expensive.

http://www.realestate.com.au/property-house-wa-mirrabooka-115433891

Alexander Heights, nothing to do, once again close to city, relatively cheap

http://www.realestate.com.au/property-house-wa-alexander+heights-115888131

Marangaroo, there are pockets in this area which are earmarked for rezoning, with a little research you could possibly secure a cheap home with future development potential. Get onto the council website to find out where you should be buying if keen

http://www.realestate.com.au/property-house-wa-marangaroo-115762175

 

[perthguy]

Also as the blocks are quite small you will possibly be looking at building double storey home which will cost considerably more than single.

I have found out that not all the blocks are small. For example, I could get a pretty decent house on this. I would prolly go the front block. I don't know the area at all though so I would have to check it out. Probably the land is a little on the pricey side but with a min 7-8 year hold, the initial land cost dimishes over time.

http://reiwa.com.au/Buy/Pages/More-...1&listingid=10363956&listingno=3365696&puid=0

Another option, as you mentioned too hard to purchase a property where you can retain and build at rear. Why not just buy a property on decent parcel of land that needs a minor reno.

That is a good option and something I will keep on the cards. Probably not right now though. I have renovation fatigue.

I would be looking at areas like Mirrabooka, close to city and as cheap as chips and it has dramatically changed over the last few years. This property wont break the bank and looks very good. Look at surrounding areas much more expensive.

IMO Mirrabooka is undervalued. Is the supposed light rail going anywhere near there? Could be a good long term option.

Alexander Heights, nothing to do, once again close to city, relatively cheap

Marangaroo, there are pockets in this area which are earmarked for rezoning, with a little research you could possibly secure a cheap home with future development potential. Get onto the council website to find out where you should be buying if keen

I think Alexander Heights and Marangaroo are pushing it in terms of cycle to work. I would ideally like to be south of Morley Drive if possible. Although, the closer to the city the more expensive of course.

It's always good to get new ideas though. It makes me consider new options. Cheers.

 

[MTR]

Those blocks in Bassendean may well be a good option, reasonable size, once you build a decent size home 220 sqm minimum what is the end value??? I looked at Bassendean quite some time ago now and what I noticed at that time was the end value of villas were too low, land value too high, from my point of view did not make sense to develop.

This is what you need to establish. Build costs, hold costs, land, total costs?? versus buying established??

Mirrabooka is absolutely undervalued as I believe the focus has been on the northern suburbs with rezoning potential, areas such as Girrawheen now pushing towards $450K.

Mirrabooka is actually only 12 km from city. The light rail has been shelved for the moment, but perhaps it will be back on the agenda. Regardless, its a winner IMO at this entry level, a no brainer. Many Asians buying in the area as they see the potential, infrastructure is excellent.

You are paying far more for Bassendean and further out from the city and there is also the possibility that you may hit clay which may cost big $ when building.

 

[Cruskits]

Mirrabooka is absolutely undervalued as I believe the focus has been on the northern suburbs with rezoning potential, areas such as Girrawheen now pushing towards $450K.

Mirrabooka is actually only 12 km from city. The light rail has been shelved for the moment, but perhaps it will be back on the agenda. Regardless, its a winner IMO at this entry level, a no brainer. Many Asians buying in the area as they see the potential, infrastructure is excellent.

Great point you make here MTR....

My jaw dropped when you mentioned Mirrabooka and Alexander Heights. But over the next 18 - 36 months as all the rezoning falls into place a full size block in a neighbouring suburb suddenly becomes quite attractive....

Like so many suburbs that people just scoff at "I would never live there" these are obviously some of the best suburbs to invest our money.

400-450k. Could do a lot worse....

 

[perthguy]

Those blocks in Bassendean may well be a good option, reasonable size, once you build a decent size home 220 sqm minimum what is the end value??? I looked at Bassendean quite some time ago now and what I noticed at that time was the end value of villas were too low, land value too high, from my point of view did not make sense to develop.

True. Although from my POV, developing for a PPoR and devleoping for an IP have different consideration.

This is what you need to establish. Build costs, hold costs, land, total costs?? versus buying established??

haha. With my taste, building could be an expensive exercise

You are paying far more for Bassendean and further out from the city and there is also the possibility that you may hit clay which may cost big $ when building.

I didn't know about the clay. Thanks for the heads up. I wonder if they had to do a geotech as part of the survey strata.

 

[MTR]

Developing for investment and buying a primary residence absolutely have different considerations, however why would you want to pay more for a property if you don't need to.

 

[perthguy]

Developing for investment and buying a primary residence absolutely have different considerations, however why would you want to pay more for a property if you don't need to.

Not need... want

 

[perthguy]

I could buy this, build my dream home on the street front and a scummy rental in the back yard. Only problem is that it is not near anything.

http://www.realestate.com.au/property-residential+land-wa-bassendean-200755203

It goes against all my locational criteria for a PPoR and for an IP.

 

[sanj]

why are you trying to build your dream home when you dont have heaps of spare cash? why not wait a few years to build the dream home? seems counter productive

 

[MTR]

why are you trying to build your dream home when you dont have heaps of spare cash? why not wait a few years to build the dream home? seems counter productive

ditto
good point, not too mention debt monster wears very thin.

 

[perthguy]

maybe "dream house" is being a bit generous.

Really just want a basic 4x2 with two seperate living areas. My idea of a retain and build was that the land component of the back house ends up being not too bad in terms of price.

I do actually have cash for the PPoR part of the deal (but not enough to cover the full cost of a block and new build if I went that route). It's IP side that I would have to borrow to fund... but then at least that is deductible debt.