mirrabooka, balga, nollamarra

[Tano]

9 one bedroom apartments look great. Is that a 830sqm block zoned R40?

If i can get 6 one bed apartments on this 695sqm block then it will be worth it. I would need more car bays since its not near public transport.

Update: Owner is overseas and gets back monday. 6 people are coming tommorow to view the property at 6pm.

There are other houses cheaper in girrawheen zoned R40, eg $349k
http://www.realestate.com.au/property-house-wa-girrawheen-112420063

and 349.5k
http://www.realestate.com.au/property-house-wa-girrawheen-113104295

 

[Tano]

There is also a sewer easement running parallel on the rear boundary. Can anyone enlighten me on how this will affect building on the property?

 

[Jake D]

you can't build in the easement, you may have to use piled footings if you build too close.

 

[MTR]

9 one bedroom apartments look great. Is that a 830sqm block zoned R40?

If i can get 6 one bed apartments on this 695sqm block then it will be worth it. I would need more car bays since its not near public transport.

Update: Owner is overseas and gets back monday. 6 people are coming tommorow to view the property at 6pm.

There are other houses cheaper in girrawheen zoned R40, eg $349k
http://www.realestate.com.au/property-house-wa-girrawheen-112420063

and 349.5k
http://www.realestate.com.au/property-house-wa-girrawheen-113104295

One is on Mirrabooka Ave, busy road, hence cheaper.

The other already under offer, so I think this was the case some time ago, market has risen since.

 

[Tano]

There were a few people at the house yesterday. Its in pretty bad shape. It looked ok from the pictures but that wood floor is actually lino and its peeling everywhere, the A/C does not work and it smells pretty bad.

There was one offer put on it last night at close to the asking price that was verbally accepted by the vendor but i can put in another offer today at 4:30pm.

I was thinking of offering 353k firm without building or termite clause valid until monday 4pm (when the owner returns). Would this give me a better chance of securing the property or is this a stupid idea? I plan to knock it down in 2 years when hopefully the new zoning laws are passed.

Anyone have any thoughts? Is 'Close' to the asking price about 5% off (generally?)

 

[MTR]

There were a few people at the house yesterday. Its in pretty bad shape. It looked ok from the pictures but that wood floor is actually lino and its peeling everywhere, the A/C does not work and it smells pretty bad.

There was one offer put on it last night at close to the asking price that was verbally accepted by the vendor but i can put in another offer today at 4:30pm.

I was thinking of offering 353k firm without building or termite clause valid until monday 4pm (when the owner returns). Would this give me a better chance of securing the property or is this a stupid idea? I plan to knock it down in 2 years when hopefully the new zoning laws are passed.

Anyone have any thoughts? Is 'Close' to the asking price about 5% off (generally?)

Do the figures on how much you need to spend and what rental income you can achieve after the makeover/reno? This is one way of working out what you should realistically pay for the property, however in this market there will be those that will pay more than it is actually worth.

I would want the option to be able to retain the front property, just in case you decide to build at the rear and may be more money in it. Termite inspection should be on the contract always unless developing straight up IMO.
Cash will work well in this market but as I said DD first.

Once zoning comes in I would be looking at what is happening in the area.

My buider/designer said these blocks at 698 sqm are too tight for 3 units/villas and option of building multi units is dependent on whether the area will support this. Multi units do not work for every area, if they did every developer would be building them now.



MTR

 

[Tano]

I put an offer of $356k but i was told this would not cut it (we will know tommorow afternoon).

I prefer to retain front and build at rear but the idea of multi dwellings has me excited. Can you explain why its not a sure thing for multi dwellings if the zoning is correct? eg R60 on 698sqm

 

[sanj]

I put an offer of $356k but i was told this would not cut it (we will know tommorow afternoon).

I prefer to retain front and build at rear but the idea of multi dwellings has me excited. Can you explain why its not a sure thing for multi dwellings if the zoning is correct? eg R60 on 698sqm

If you do the maths margins can be tight for multis in some suburbs. Eg in Mandurah, you can buy a nearly new 3x2 double storey townhouse for $399k at the moment. Based on that, how cheap would you need to sell apartments and how much margin would there be?

Or you look at this, http://www.realestate.com.au/property-house-wa-armadale-107927176 someone is selling some OTP villas in Armadale at from $269k and near new ones are asking $329k. You would only sell 2x2s for no more than $260 or $270k at the very max and even that is pushing it, prob be $249k OTP. There just is no margin in it, definitely not enough to justify the risk

 

[MTR]

I put an offer of $356k but i was told this would not cut it (we will know tommorow afternoon).

I prefer to retain front and build at rear but the idea of multi dwellings has me excited. Can you explain why its not a sure thing for multi dwellings if the zoning is correct? eg R60 on 698sqm

All the best, keep us all posted.

Yes, retaining is an easier option, unless you can purchase a house on larger block and build 3 nice size villas.

My builder/designer is building quite a few of these multi units for his clients in Belmont, apparently there is a demand for this product in this area.

I have no experience when it comes to building multi units, I have put together plans and permits and onsold only.

My point is if you are looking at building multi units in the first instance work out whether there will be a demand for this in the area, how well will they sell and of course what stacks up financially.

I am personally not looking at multi developments because it does not fit my sleep at night factor. I want to keep it simple and don't want to kill myself paying holding costs, I want to be in and out as quickly as possible.

 

[Aaron Sice]

I am personally not looking at multi developments because it does not fit my sleep at night factor. I want to keep it simple and don't want to kill myself paying holding costs, I want to be in and out as quickly as possible.

there is a system that allows you to do multis and the client and builder have the contract with you paid the margin and no holding costs for you bar land....

but

it only fits the most vanilla sites out there.

 

[aramz]

That property is definitely in the nicer pocket of Girrawheen Tano. The shops just north east of the property are great which is a bonus.

So the property you are bidding on could potentially be rezoned R60 and the other areas are potentially zoned R40. I have noticed there are other areas in Koondoola and Girrawheen that are marked 'Extended Area R40', does anyone know what this means? Is extended R40 area a recent addition to the proposed rezone areas or is it only a possible a chance of being in the proposed rezone area?

Thanks

 

[aramz]

Also with regards to these Girrawheen and Koondoola developments with retaining the existing and building at the back what kind of profit potential do you think can be achieved as opposed to doing the same in Balga which is a bit closer to the city?

For arguments sake a 690sqm block in which one could retain the existing house and build at the back would cost around 360k for girrawheen and 400k for Balga. So you are getting the block around 40k cheaper but how much could you expect to sell a rear block 3x2x2 for compared to a one of the same in Balga. Possibly 30k cheaper would be expected or much the same price? It's hard to say as a market for new 3x2x2 rear block builds in Girrawheen hasn't been established yet.

Anyone else have any thoughts on this matter?

 

[westminster]

Also with regards to these Girrawheen and Koondoola developments with retaining the existing and building at the back what kind of profit potential do you think can be achieved as opposed to doing the same in Balga which is a bit closer to the city?

For arguments sake a 690sqm block in which one could retain the existing house and build at the back would cost around 360k for girrawheen and 400k for Balga. So you are getting the block around 40k cheaper but how much could you expect to sell a rear block 3x2x2 for compared to a one of the same in Balga. Possibly 30k cheaper would be expected or much the same price? It's hard to say as a market for new 3x2x2 rear block builds in Girrawheen hasn't been established yet.

Anyone else have any thoughts on this matter?

I agree on that. The prices for the area are now ridiculous considering the zoning still hasn't even gone through yet.
Back when it was low 300s or high 200s then yes but now I wouldn't go near it.

 

[MTR]

I agree on that. The prices for the area are now ridiculous considering the zoning still hasn't even gone through yet.
Back when it was low 300s or high 200s then yes but now I wouldn't go near it.

Balga is still rising now $400-410K, Council are now looking at changing zoning to reduce infill, so for those who do not develop now they may be in for a nasty surprise.

I understand your point but at the end of the day areas such as Girrawheen, Koondoola, Lockridge and Beechboro may on the surface seem too expensive in comparison to Balga however they continue to rise and in 3 years time who knows what the prices of units will be. I don't worry about today's figures as it is irrelevant.

If you can purchase and hold while rents cover most or all holding costs why not??

 

[westminster]

Balga is still rising now $400-410K, Council are now looking at changing zoning to reduce infill, so for those who do not develop now they may be in for a nasty surprise.

I understand your point but at the end of the day areas such as Girrawheen, Koondoola, Lockridge and Beechboro may on the surface seem too expensive in comparison to Balga however they continue to rise and in 3 years time who knows what the prices of units will be. I don't worry about today's figures as it is irrelevant.

If you can purchase and hold while rents cover most or all holding costs why not??

And I agree with this too. If you can hold for capital growth then all good. It ends in tears only if you want to sell straight away.

 

[sanj]

I don't worry about today's figures as it is irrelevant.

It then becomes a punt and i dont think punts and developments go hand in hand.

 

[MTR]

It then becomes a punt and i dont think punts and developments go hand in hand.

Oops, I duplicated the same message.

Agree with you.

I will clarify .... I know what units sell for in the area and I also know they have increased in value over the last 8 months, but I am not building today I am landbanking. I have no idea what units will be worth in 3 years time, my guess is more than today.

When zoning finally happens this is when I will review the various scenarios and establish what will stack up.

If there is more money in just selling and not developing this may be the the way I go.



MTR

 

[aramz]

You're right MTR. Units will be worth more in 3 years time and with the possibility of less saturation from the Balga markert through possible dezoning etc there could be decent demand for brand new 3x2's in Girrawheen and Kondoola. Time will tell and holding costs are minimal if you can snag a decent rent. Just wish I was active in this market 6-12 months ago when these big blocks were about 40k? cheaper. Market has well and truly cottoned on to the potential here.

Any luck with your purchase Tano?

 

[Tano]

They Counter offered at 365k firm and I countered them with a final offer at $359k. Just sending the paper work today. I have only ever done retain and build so speculating on rezoning and demolishing and attempting to squeeze 3 dwellings on 692sqm is making me nervous.

 

[MTR]

They Counter offered at 365k firm and I countered them with a final offer at $359k. Just sending the paper work today. I have only ever done retain and build so speculating on rezoning and demolishing and attempting to squeeze 3 dwellings on 692sqm is making me nervous.

Hi Tano
So can you retain and build, you have enough rear access and is the house in the right position to do so???