Sub-Division Confusion

[Daz4130]

Hi Everyone,

I have been presented with an opportunity to purchase 2 houses on one property. The second house was built with council approval and is completely seperate to the main house except for the shared use of the driveway.

The owner of the property has advised and shown me documentation of its approval for sub division. The only thing left to do im told by the owner is to basically pay for it which will give the ability to sell the 2 houses seperately also making seperate council rates. the cost of this is around $5k. All utilities are currently seperate with people living in both.

I'm new to this and dont understand whats involved in this next step. Sorry for the vague information. if anyone is able to shed some light on this it would be much appreciated.

Darren.

 

[HD_ACE]

where is the property?

cheers

 

[Daz4130]

Property is in Ramsgate Beach NSW

 

[Tano]

Property is in Ramsgate Beach NSW

From your point in the process, here are some of the costs for seperate titles in WA

Survey Strata Fee: $4,200 Maybe already done?
Govt Fees: $1,950
Landgate titles $2000
Water Head works $7000 (You only pay headworks on each additional property you're putting on the block)
Council Fees
Council requirements . eg Carport, binstore, drainage.

Most of that money is just fees (red tape) in which you dont get anything tangible.

 

[Daz4130]

Thanks Tano.
So giving the above is completed we then have 2 seperate properties which could be sold. This should increase the overall value as opposed to selling it as one property correct?

 

[HD_ACE]

Thanks Tano.
So giving the above is completed we then have 2 seperate properties which could be sold. This should increase the overall value as opposed to selling it as one property correct?

yes More often than not two is worth more than one.
Subdivision is a popular wealth creation tool used.

The only problem i see is why the owner would not spend the 5k to subdivide themselves and create 50k,100k or even 200k profit.

Certanly look further into it and at the conditions on the conditional approval. There might be something else requiring big $$$ to implement .

cheers