Permits, design, construction, costs, risks, delays advice for beginner

[motivated 5555]

How would I best navigate council and decisions around size, materials and design
For Building of granny flat behind a ppor
Aswell as some changes to tge back of the ppor
Who would be involved
Do I need a project Manager
If so how do I best find suitable ones and suitable builders
Do I use a kit or relocatable home or build from scratch
Would I use brick? Double brick ? Or anything else ?
I've never done anything before
And don't feel confident
And don't want to regret decisions or design
And I want to minimise stress but also not be taken for a ride with costs as I want this to help earn me some security and income .
At around 50 with low income I don't have room for huge mistakes .

Thanks

 

[Propertunity]

Give Serge a call who posts here as "Brazen".
He does drafting & granny flat design and approvals.

http://www.somersoft.com/forums/showthread.php?t=63616

 

[RumpledElf]

Might want to check just how much finance you can get for a granny flat too - finance for building might be harder than finance to just buy something. Do you have a few $1000 in the bank for the initial costs, or do you have no savings at all?

Relocatable home you need access to the back for a Really Big Truck.

Check with local PMs to get rent appraisal/s.

Also, post up a quick sketch of your block with the outline of the existing house and what council you're in and someone can help you work out if its even feasible.

Still think you're better off selling and buying two or three than staying. Staying in a house (assume paid off?) could be the worst financial mistake you ever make. It'll certainly be the most limiting thing you can do on a low income. What's the house worth? What's the land worth?

Knockdown and building units is probably not feasible at all, UNLESS there is space at the back to build the first unit, then you knockdown and build the rest, which is what my inlaws were talking about a year or so back, they're in a 70s house on a large paid off block in an area that is giving way to lots of multiple units where older houses once were - but they'll never do it. Its Too Hard.

 

[Aaron_C]

I agree with RumpedElf. Doing small developments like this can be more trouble than its worth. The entire premise of development is to get land cheap because you buy lots of it, then sell it for a higher price because you have economies of scale in construction. Without either, you will lose money.

 

[RumpledElf]

Developing on a pension/low fixed income sounds like a recipe for disaster unless you've got really serious savings behind you.

At some point you are going to have to make a choice between staying in the family home and making a break, selling it, and investing the proceeds in something that earns income.

Step 1 is find out what your house is worth.
Step 2, subtract what you owe.

THEN think about what you can do with that amount of money + whatever the bank will lend you. Otherwise you're going to be 100% limited by whatever the bank will lend you with absolutely no margin for error.

 

[Aaron_C]

Development is a very unforgiving game. There is zero cashflow until you sell. And before you sell all there is is negative cashflow as you have to pay interest costs, consultant fees, tax etc. Not for the faint of heart.

 

[RumpledElf]

Been there, done that, paid all the fees and upfronts in cash, paid the "oops we went over budget" in cash, and haven't sold yet. And currently spending happily on landscaping. Yay for somehow aquiring nice big lines of credit at the local builder's supply yards

Not liking this whole paying interest and maintenance on an empty house gig though. Damn 60 day settlement periods. Why can't you sell a house in a week (don't answer that lol)

 

[motivated 5555]

Thanks for your time advice and suggestions. I"m not seeking to develop just a 2 or 3 bedroom granny flat.
Please can you tell me much more about the actual steps for putting in a granny flat behind a ppor with a rear entry.
anything you can tell me of the steps
eg of council permits,
design, i dont want to regret later re best size ,design, materials,

building and how best to navigate each pls.

I will be very careful re finances and wont do it unless its ok,
but pls could you tell me re all costs to consider pls
it is feasible many neighbours have done it but the owners dont speak english to find out from them I believe it will pay itself off fast and then earn every year after that.

I'd like to know as much as possible about each step in the process of
council permists, design, getting a good builder, and building pls and costs involved pls.

 

[wylie]

If you have never done any developing or building before, (and we have never built from scratch, so I'm in that boat too) wouldn't you be best to get in a building company who can do all the hard work?

You may pay more, but you would have a fixed price contract and have much less risk and worry.

 

[motivated 5555]

yes thanks Wylie

thats what i tried to ask originally i think, if for a granny flat for someone who has never done anything would i need a project manager.

I've watched others do lots of things, built homes, renovated, confidently. I am not confident. I dont know when people get project managers and when they dont. I dont know much at all.

if i get a granny flat thats like a kit home prefabricated then do i still need a project manager to oversea everything properly.

I spoke to one but he seemed to want to do everything a very expensive way brick, more bedrooms, bigger. I'm not sure if i want brick or if i just want something sufficient to get good rental returns faster and cheaper, I just know i want the size, design and materials to be decided properly so i dont regret later

how do i find good building companies or project managers and what do they do exactly. would i speak to a few get a few quotes.

 

[weg]

Contact companies that do prefab/kit granny flats, and get a turnkey price.

Make sure they come recommended (post the name of the company here or contact previous customers if possible), as well as physically see the product you get.

If you have a credible company things should be relatively smooth going.

Without building experience/licences (and no confidence), this is probably the only and best approach you can take.

Obviously sign contracts subject to council approval and finance.

Are you in Melbourne or Sydney?

 

[wylie]

Great advice from weg about finding a company that specialises in granny flats. The other thing I saw once was a granny flat (outdoor room - a bit like a shipping container, but looked nicer) that is lifted into the back yard by crane, all finished already, just needing to be hooked up to water and power.

 

[RumpledElf]

I believe it will pay itself off fast and then earn every year after that.

Define 'fast'.

If it costs you, say, $60k to build it and you get say $200 a week rent @ 7% interest, 'fast' is probably still upwards of 10 years to fully pay it off. Much less if you tip in extra of course - brilliant figures if you've already got the cash lying around, far higher yield than just in the bank. You're 50 so you probably won't get a 30 year loan so the repayments might end up higher than you expect.

Remember to factor in expenses with your calculations - insurance, maintenance, increase in council rates, possible vacancies.

You really, really need to get hard figures - anticipated rent for the granny flat and/or your house, the size of your yard and location of your house, actual cost to build the granny flat (don't forget to include REAL figures for connecting water/sewer and electricity) and how much the bank will lend you.

Still think this is one of the less effective ways to earn money on a really low income. So much hinges on how much the bank will lend you in the first place and you seem to have no idea or you would have started this thread with "I have preapproval for X, what's the best thing I can do with this much money".

 

[motivated 5555]

Thanks everyone for all the hints and advice. Much appreciated

I pm'd you rumpled elf thanks for all your time cautions and advice to consider.

On this thread i would still like to deal with doing a granny flat,

costs, companies, how to go about it permits design, how to choose builders or granny flat companies so i dont regret later not having done it bigger brick, cheaper, easier, etc

wylie i noticed those too, unsure where, but they are like blocks that can be added to at any stage to add another room to a house or granny flat

or even added on top as an upstairs.

I like the idea also of doing it on legs so it can be moved if in future plans change.

 

[RumpledElf]

If you ask another question without knowing how much you can borrow, I'm going to write you off as a lost cause.

Considering how easy it is to find out how much you can borrow. Like, its REALLY easy. If you earn over the Henderson poverty index line in the sand anyway.

 

[RumpledElf]

I like the idea also of doing it on legs so it can be moved if in future plans change.

Also - I have a house on legs (stumps). It cost $6500 to put it here and a little more than $14,000 to connect it, although the connection costs would have been similar with a brick house but probably built into the contract not an extra at the end. I'm including the electrical connection, water meter and all the plumbing connections but not the septic tank.

You'll have to pay the setup costs again if you move the granny flat.

You've got us talking on what our next move will be - our best option is to save save save save save so we can either do the next project cash or just prove to a bank we can repay them.

 

[pennyk]

I'm sorry, but it doesnt sound like you've done any of your own research yet, and you just want everyone to give you answers and directions.
If you are really serious, go away, do some investigations and then come back with some specific questions of what you are finding difficult to find out.