mirrabooka, balga, nollamarra

[aramz]

You will learn a lot during the whole process Tano. Be interesting to see if you can throw a 2x1x1 in the mix to create some more space if you need it.

I know every site varies but does anyone know roughly how much value would be lost in the existing house if you were to build a house out the back and add in a new double carport at the front for the existing?

 

[MTR]

You will learn a lot during the whole process Tano. Be interesting to see if you can throw a 2x1x1 in the mix to create some more space if you need it.

I know every site varies but does anyone know roughly how much value would be lost in the existing house if you were to build a house out the back and add in a new double carport at the front for the existing?

It would be a guestimate, but I would start by looking at what duplexes sell for in the area and compare space ie bedrooms etc this should give some indication on the range I would hope

 

[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.

Any updates

 

[Tano]

They recountered again at 362k and i pulled out the negoiations. Here are the problems

1)Zoning is proposed R60 in 2 years. Both the zoning and date are speculative guesses
2)They wanted a large deposit
3)they wanted a long settlement time
4)They wanted no conditions (pest or building inspection report).

I agreed to all but with this amount of risk it was not worth the 6k discount plus it would be hard to fit 3 dwellings on the 692sqm block as someone mentioned. (the house is in the middle and is barely habitable)

 

[sanj]

This is my issue with the rush in the area.

If the plan is for capital growth then yes i guess the argument could be made that it is looking positive.

For developments though buying at 360k+stams+holding costs+demo+subdivision costs etc you are going to end up with blocks costing you say $210-220k each so, taking into account escalating building costs etc you are talking AT LEAST $400k finished.

Will you be able to sell each for over $500k?

 

[Tano]

If all goes well and i sell in a few years then there is a little profit.

Land = 360k
3 dwellings = Roughly 550-600k to demolish existing and build
= 1,000,000 after stamp duty (not incl holding costs, titles etc)

Sell at 400k each (prob 380k after agents fees and discount)
Profit = 140k profit

Otherwise i should get about $1200/week rent from all the units but this would be less than the $1400 week interest only payments on 30 year loan. But every year the yield and capital growth will increase for 3 dwellings whilst the loan repayments stay the same (hopefully)

This is assuming everyone does not develop all at once and push up the supply or the mining boom peaks in the middle of this year :-(

 

[sanj]

If all goes well and i sell in a few years then there is a little profit.

Land = 360k
3 dwellings = Roughly 550-600k to demolish existing and build
= 1,000,000 after stamp duty (not incl holding costs, titles etc)

Sell at 400k each (prob 380k after agents fees and discount)
Profit = 140k profit

Otherwise i should get about $1200/week rent from all the units but this would be less than the $1400 week interest only payments on 30 year loan. But every year the yield and capital growth will increase for 3 dwellings whilst the loan repayments stay the same (hopefully)

This is assuming everyone does not develop all at once and push up the supply or the mining boom peaks in the middle of this year :-(

It has already been said that building 3 will be difficult. If you do build 3 they will have to be double storey, costs will be upwards of $250k each. On the plus side you would get over $400k each imo but the margins are bloody tight. You also have to add subidivision costs to the equation so construction to turnkey level, including subdivision and planning fees will be over $800k if you build 3.

Total cost of $1.2m, which is $400k each. Profit margins are tight.

Also, you have said margin of $140 excluded holding costs etc, that is a recipe for disaster. Do your feasos based on all costs being included as well as a contingency.

By all means buy it if you feel there are cap gains to be made but if you plan to develp soonish i dont see how it is really worth it imo. At 300k for the purchase yes, or if the blocks would let you fit 3 single storey homes also yes. But at this price and this size no imo.

Just my opinion, i could certainly be completely wrong.

 

[Tano]

No, your right. I assumed single story and margins will be tight. I will be looking for block sizes >650sqm in which i can battleaxe and put 1 house on the back whilst retaining the existing dwelling. These are getting hard to find and more expensive. Does anyone have any tips in what other suburbs i should be looking that is not already saturated with developers?

btw, i just got a SMS that someone has put an offer on the property. Which one of you was it

 

[thydzik]

All the best, keep us all posted.

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.

care to share the name of your builder?

 

[MTR]

They recountered again at 362k and i pulled out the negoiations. Here are the problems

1)Zoning is proposed R60 in 2 years. Both the zoning and date are speculative guesses
2)They wanted a large deposit
3)they wanted a long settlement time
4)They wanted no conditions (pest or building inspection report).

I agreed to all but with this amount of risk it was not worth the 6k discount plus it would be hard to fit 3 dwellings on the 692sqm block as someone mentioned. (the house is in the middle and is barely habitable)

I would be out as well, position of the house??? As mentioned my builder did say 3 units does not work on this block size, however RE agents are promoting 3 units and why wouldn't they??

My last purchase in Girrawheen was on 840 sqm block, they don't come along very often but if you can secure something on larger block it may work as these are scarce. Even if you do not develop someone will buy it at a premium once zoning comes along. Anything over 728 sqm would be OK.

Ray White Mirrabooka get most of the listings but they also get the best price for their client.

Of course you could always look at other areas which already have zoning in place, the only area that comes close as far as price goes is Balga now $410,000+ and rising, otherwise you will be paying $500,000+ and these are incredibly hard to secure there are so many looking in this price bracket, unless someone knows something I don't know.




MTR

 

[Rhinsor]

Anyone see the flood of properties for sale in Balga in the last couple days, mostly a few years old

 

[MTR]

No, your right. I assumed single story and margins will be tight. I will be looking for block sizes >650sqm in which i can battleaxe and put 1 house on the back whilst retaining the existing dwelling. These are getting hard to find and more expensive. Does anyone have any tips in what other suburbs i should be looking that is not already saturated with developers?

btw, i just got a SMS that someone has put an offer on the property. Which one of you was it

Developers are shopping everywhere, very much depends on your budget and then there will possibly be multiple offers. I think Sanj mentioned 12 months ago was a great time to buy these. Still not too late IMO as long as the figures stack up. These are some of the areas I was targetting.

Embleton
Morley
Bayswater
Bassendean
Midland
Nollamara
Yoking
Tuart Hill
Joondanna
Doubleview
Hamilton Hill
Spearwood
Hilton
Armadale
Kelmscott

If you are trying to get into areas for proposed re-zoning then contact various councils ie City of Wanneroo, City of Cockburn to name a few.

I just secured a 3 unit R60 development site, $530,000, the house currently on the site will rent for around $480-500 pw, just helps while I get paper work etc. together for build. The villas are racing out the door, very much in demand, nice to know. Once I settle on this property will be happy to share more information.

 

[MTR]

Anyone see the flood of properties for sale in Balga in the last couple days, mostly a few years old

That is a concern, I mentioned previously developers offloading, that in part is why villas don't sell that well, too many. I had an opportunity to buy a site in the area but there is perhaps 10% profit if you are lucky

 

[MTR]

No, your right. I assumed single story and margins will be tight. I will be looking for block sizes >650sqm in which i can battleaxe and put 1 house on the back whilst retaining the existing dwelling. These are getting hard to find and more expensive. Does anyone have any tips in what other suburbs i should be looking that is not already saturated with developers?

btw, i just got a SMS that someone has put an offer on the property. Which one of you was it

If you can build 4 units on this it could possibly work??

http://www.realestate.com.au/property-house-wa-nollamara-113269887

House on same street, I believe similar size sold at auction for $590,000 about 3 weeks ago I think

 

[MTR]

Morley build at rear ??

No, your right. I assumed single story and margins will be tight. I will be looking for block sizes >650sqm in which i can battleaxe and put 1 house on the back whilst retaining the existing dwelling. These are getting hard to find and more expensive. Does anyone have any tips in what other suburbs i should be looking that is not already saturated with developers?

btw, i just got a SMS that someone has put an offer on the property. Which one of you was it

If anyone is interested.....

Just got a phone call from RE agent, this one has not hit the market yet but will be opened today from 5.30 - 6.00 pm, from $539,000, block size 739sqm,
R20/25. Selling agent Woodville

http://maps.google.com.au/maps?hl=e...=uQlAUcHsHeLLmAWh4ICABQ&sqi=2&ved=0CC0Q8gEwAA


It may be worth viewing as I think there is side access.
Possibly retain front and strata, sell rear block, or build unit.

Not the best location in Morley but then you would be paying $570,000 in this market. Make sure you do your own homework

Most agents will not allow viewings prior to it hitting the market, very unusual but good

Cheers, MTR

 

[Tano]

What is the address?

Thanks

 

[MTR]

What is the address?

Thanks

oops, link attached now.

 

[sanj]

morley retain and builds are $570k now???

good lord. arent front homes still 420-440? Why would anyone pay these crazy prices?

Morley was always undervalued imo but now is looking a bit expensive.

 

[MTR]

morley retain and builds are $570k now???

good lord. arent front homes still 420-440? Why would anyone pay these crazy prices?

This one went for $575,000 cash offer day 1, 8 offers on the table.

http://www.realestate.com.au/property-house-wa-morley-113114959


Front property, depending on location and condition will sell for $450,000
rear villa depending on specs will sell for $525,000, but they have also sold higher, once again lots of variables to consider.

What can I say, its a crazy market, it just keeps rising, I know cos I keep having to pay more for next deal, I'm done now, until I finish my build.

 

[MTR]

morley retain and builds are $570k now???

good lord. arent front homes still 420-440? Why would anyone pay these crazy prices?

Morley was always undervalued imo but now is looking a bit expensive.

I think Morley has caught up to Embleton prices now, but then surrounding areas such as Bedford, Dianella are far more expensive, entry level around $700,000 for property with development potential.