land is better than no land..

[neeko]

yep i have been talking to a few people and well i have come with a question and everyones answer will be great.

why are townhouses so BLOODY EXPENSIVE!!

its a freeking joke! most of all i HATE subdivision!!!!!! why? cause it has somuch more impact on roads, transport & how we get to work!

i was driving through somerville yesterday where i bought my first house (yes im a peninsula boy) anyway and i saw this house i had been eyeing off for a while it went under contract which is fair enough and it was on between 395-415. yet in the SAME STREET! just 3 houses down there is a subdvision going on for 3 x townhouses on the SAME BLOCK for 395k EACH! i'd rather have a the house with a 700sqm block (i.e sommie house) than a townhouse for the same price!


i also saw a thing about subdivision on channel 9 news a while ago. its peoples own fault for selling there own backyard cause they put themselves in there own mess!

rule of thumb: land appreciates. houses depreciate!

 

[The Y-man]

Many DINK renters prefer a small yard - less things to maintain, no lawn to mow, nothing to water (with water you pay for) and generally less things for the landlord to complain about at inspection.

The Y-man

 

[sanj]

brand new townhouses for 395k, work backwards to see why they cost so much

minimum 20% developers margin, GST, selling fees, holding costs, construction costs, subdivision costs, stamp duty, purchase price (in this case im assuming 395k)



at a raw block cost of 132k, 395k for finished townhouse seems pretty reasonable, there would certainly be absolutely no money in it in perth if you were building 2 storey, you would need to be in the high 400s at the minimum

 

[neeko]

well i have a house here in frankston and im thinking of selling it to buy in greenfields with the equity i have so i have no mortgage, but would like to know more about the area sanj as i have friends in warnbro but my family resides in midland.

 

[Dazz]

i was driving through somerville yesterday where i bought my first house (yes im a peninsula boy) anyway and i saw this house i had been eyeing off for a while it went under contract which is fair enough and it was on between 395-415. yet in the SAME STREET! just 3 houses down there is a subdvision going on for 3 x townhouses on the SAME BLOCK for 395k EACH! i'd rather have a the house with a 700sqm block (i.e sommie house) than a townhouse for the same price!

This is very common all throughout Australia.


Many developer's do a deal with the (usually elderly) Landowners who contribute the land and the developer does the rest. Builds say a quadraplex, the original Owner gets a brand spanking new home to move into, two sales pay for the construction of all four homes and the fourth home is the builder's profit - for either selling or renting out for cashflow.


Very common business model.....and many many elderly Australians take advantage of the offer presented to them, trading their old ramshackle place that is too big and cumbersome and expensive to maintain, for a brand spanking new townhouse (with probably the same amount of bedrooms in it) with all new appliances and all the mod cons) for absolutely no cost and no worries for them. They lose their backyard of course, which at their age they didn't want the hassle of looking after anyway.


Plus, and this is probably a bigger factor than anything, they don't have to up stumps and move someplace else, cutting ties with all of their neighbours, friends and family / clubs / associations.


I guess you are just at a different stage in life and aren't quite looking at the situation from the same angle as the elderly folk.


The business model works so well all over the country cos everyone involved has a win out of it.

 

[devank]

going on for 3 x townhouses on the SAME BLOCK for 395k EACH! i'd rather have a the house with a 700sqm block (i.e sommie house) than a townhouse for the same price!

Look at from the other way. If 3 bed units are going for about 300K then why can't a brand new townhouse with a small land go for 395K?

 

[Gools]

its a freeking joke! most of all i HATE subdivision!!!!!! why? cause it has somuch more impact on roads, transport & how we get to work!

Maybe you're looking a bit too short term though. As the number of houses on big blocks reduce then their value has to increase (supply v demand). Yes 'your' roads are more congested but if population density isn't increased then the sprawl just extends further out. Still makes transport busier, with most people still wanting to commute into the city.

 

[Chomp]

If people think building and then selling (speculation) is easy and a done deal be my guest, its all fun and games while the music is still playing.

You need a crystall ball because by the time you start and finish your looking at around 1.5 yrs from initial acceptance.

Chomp