Exciting times and congrats on the purchase.
Only thing is I would be cautious relying on 'verbal' quotes from builders. Last 20 quotes we've received were all along the lines of "yeah $1150/m2 turn key easy done"...not kidding, I wouldn't be exaggerating if I said all 20 builders said the same thing. Engineering gets completed, given to builders to firm up prices and what do you know, they mostly came in at $1500/m2.
We find we're able to achieve a fairly decent turn-key price with our negotiating purely based the number of homes we offer the builder on a single job but yeah, I agree with earlier post that it'd be extremely hard to achieve $1100/m2 turn-key unless it excludes major things like floor coverings, a/c, driveways and perimeter paths, landscaping, civils etc. My Brother did his last development as Owner/Builder and only then he was able to achieve $1100/m2.
Probably not so crucial if your intention is to hold on for long term unlike for us, we get in and out as quickly as possible and the build price is critical in making or breaking the deal potentially.
Good luck and looking forward to reading more of your progress
Not going to lie, cant be 100% confident on what price I'll get from the builders. I have a client who is a builder developer who has been saying for years that he will build be awesome house at good price, but will see how that goes when the time comes.
The builder brokers are also very confident in getting me the best price, they wouldn't commit to a price per sqm, but they think their builders will be cheaper then what I can source myself. If they aren't thats fine, they dont get paid. So it's in their best interest to get lowest price.
I have a developer family friend who is in part mentoring me, she has offered more to do owner builder (has a building company), but being first project I've decided against. She is willing to pass my details onto a builder friend of hers who again she think will be very well priced.
There is no guarantees in any of this, from my calculations there is enough 'fat' in the deal for it to be profitable.
$335,000 purchase price
$18,000 purchase costs
$8,000 demolition
$33,000 subdivision
$8,000 architect
$6,000 engineering
$12,000 misc costs
Total cost for site $420,000
Approx 615sqm @ $1,100 per sqm = ~$675,000 build cost
Even if add in an extra $65,000 (approx 10%)
So then total build cost $740,000
Then total cost = $1,160,000
(developer friend/mentor believes should be able to get $1,000 per sqm and finishes driveway/landscaping/fencing/flooring for ~$30k per property, so based on her figures $705k for the build)
Min Value for Duplex $430,000 each
Min Value for Detached $450,000
Total Value $1,310,000
Which results in $150,000 minimum gain, based on larger build costs and lowest values. I wouldn't be surprise if the duplex are worth $20k more and the detached up to $40k more.
