Sunshine Development Diary In Detail

[Mindmaster]

Fantastic Brendon
Progressing well.
Have you sourced another site yet???
cheers
MTR

Hi MTR, My income is pretty ordinary which makes finance for the next development tight. I was going to wait until this development was finished (around Oct), run all the numbers such as rent, values etc past my MB, see how much I can borrow then source another site.

Your question has me thinking (dangerous) and I'll have a chat with my MB soon. Could be that even conservative expected numbers look good enough that I can source another site soon with minimal risk.

 

[LoneWolf]

Hi MTR, My income is pretty ordinary which makes finance for the next development tight. I was going to wait until this development was finished (around Oct), run all the numbers such as rent, values etc past my MB, see how much I can borrow then source another site.

Your question has me thinking (dangerous) and I'll have a chat with my MB soon. Could be that even conservative expected numbers look good enough that I can source another site soon with minimal risk.

Brendon, you are doing much better compared to 95% of the population here. So be proud of what you have done and doing

I am hoping to write my first development journey some time soon

 

[MTR]

+1

Just another thought regarding projects/money/finance, what I have found in my own personal situation is that to improve serviceability, cash flow it is actually better to sell off all my developments year 1, especially while the market is good. The down side is obviously paying CGT, but I see this as part of business and also a way to increase turnover, more $.

This way I bring back my deposits and profit back to the table and able to then increase the number of developments I can do the following year. Perhaps year 2 I may only sell half?

Anyway, good work. I like the Melb market.

 

[Mindmaster]

 

[Michael_X]

Love the pics, keep the updates coming

 

[ChrisA1]

yep, loving the pics (almost makes me want to become a novice developer like Mastermind, but would need a quiet word with Brendon first... )

 

[clutchcargo]

Hey Brendon, we're just around the corner having bought in Albion, I drive past every day, saw your guys working on the public holiday yesterday. All the best!
Ben.

Edit: Already seeing prices start to climb agressively around this area...

 

[technoir]

Am also just around the corner from the site, was impressed to see work happening on Monday's public holiday! Framing is up on the rear unit, looks like things are progressing well

 

[albanga]

This is a fantastic thread! Thank you mastermind for all the detailed updates. I wish you all the best in your development, looks like it is starting to take shape.

I am actually starting my first ever development which is building a 3 bedroom double story to the rear of my PPOR in Niddrie. I have been issued my planning permit and am now just waiting on engineering to complete the drawings which should be this week.

It is funny how naive I was as early as 6 months ago thinking I had any sort of idea what development included. I have learnt so much from reading books, magazines and ofcourse these fantastic forums but I still know so little!

 

[Mindmaster]

You can see in the first pic that the bricks for the garages have been delivered

 

[Mindmaster]

Hey Brendon, we're just around the corner having bought in Albion, I drive past every day, saw your guys working on the public holiday yesterday. All the best!
Ben.

Edit: Already seeing prices start to climb agressively around this area...

Am also just around the corner from the site, was impressed to see work happening on Monday's public holiday! Framing is up on the rear unit, looks like things are progressing well

Working on a public holiday?!? Nice! Wonder what the incentive was, a couple of slabs a piece

Nice to know about the price climb CC. Been watching potential development sites in Sunshine/Ablbion for a while and prices for those blocks have been going up for a continuously. Now very difficult to find a worthwhile site to develop.

This is a fantastic thread! Thank you mastermind for all the detailed updates. I wish you all the best in your development, looks like it is starting to take shape.

I am actually starting my first ever development which is building a 3 bedroom double story to the rear of my PPOR in Niddrie. I have been issued my planning permit and am now just waiting on engineering to complete the drawings which should be this week.

It is funny how naive I was as early as 6 months ago thinking I had any sort of idea what development included. I have learnt so much from reading books, magazines and ofcourse these fantastic forums but I still know so little!

Hi Albanga, I have a great team in place for finance/development etc with CDS doing all the hard work. Sounds like you are doing it hard core without training wheels. Well done.

 

[Mindmaster]

Brick work on the garages should be just about finished.

 

[Finrod]

Thanks for sharing MM. Your positive attitude is also great to see.

Would love to hear of your lessons learned as well.

 

[willy1111]

Slowly but surely making progress.

Abolishing
-Paperwork for abolishing gas and electricity was completed and submitted 29 Dec, the WORST time to do it. Abolishment was finished a month later. Troublesome procedure.

Finance
-There were a few stuff ups and finance that should have been finished mid Jan was finished mid Feb. Very not fun. Gotta love MB's who deal with the banks and make the whole process work (Peter T is the man). The bank (ANZ) did a 66 page valuation

Demolition
-Due to start next Thursday. Not sure how long it takes. Arranged by and in the capable hands of CDS.

Over All
Everything is on track with completion delayed by around a month. Will have a better idea later on the (very) approximate completion date.

Hi Brendon,

Thanks so much for sharing - a very educational post.

Just wondering how the bank valuation stacked up against your estimated values prior to starting.

Also - connections/drainage/fencing/driveways - is that all included in the build contract?

Many thanks.

 

[Mindmaster]

Hi Brendon,

Thanks so much for sharing - a very educational post.

Just wondering how the bank valuation stacked up against your estimated values prior to starting.

Also - connections/drainage/fencing/driveways - is that all included in the build contract?

Many thanks.

Hi Willy, The bank gave a value of $975,000 in their valuation which is surprisingly close to the expected value of around $1050k.

I pay for city west costs (paid) and electricity (expect to be minor). Driveway is included in the build contract. Fences are separate which makes sense. Can't see a builder going through the effort of negotiating with neighbours to cover half the costs, decide on fence type etc etc. My last experience with neighbours and a fence was not pleasant.

 

[Peter_Tersteeg]

Banks valuation is based on hard costs. First they value the land. They then look at the building contract to determine that the builder isn't charging to much. They add the figure on the building contract to the land value and you've got your result of $975,000. This is known as a hard cost valuation.

When the project is completed the property can be revalued. At that point they'll look at the individual market value of each unit. If it isn't subdivided, the cost of subdivision will be deducted and this is the completed valuation result.

This is fairly standard procedure for residential constructions.


This this case, the valuation was actually a 'completion' valuation. It got a higher result than was anticipated, but we made sure the figures worked on a much more conservative result. We also had contingencies in place if it had come back even lower. The valuation cost the bank about $1800, part of the delay was convincing the bank to actually spend the money. They checked ever facet of the deal before proceeding with the valuation. It then took over a fortnight for the valuer to actually produce the result.

I'm hoping Mindmaster will be pleasantly surprised in a few months another valuation when the whole deal is done.

 

[westminster]

Due to a P site classification (high moisture and clay content), the two choices for slab were 1 - Stiffened raft slab or 2 - Waffle Pod footing slab. Ended up going for a waffle slab. The polystyrene blocks/pods are clearly visible in the pic.

A little nervous in having what is basically foam boxes in the foundations but it is cheaper, faster, requires less earth works, better insulation and does a good job.

I just got a M class back for our PPOR land and they were talking waffle slabs and I knew I had seen them recently then I remembered it was your thread.

They look much taller than a normal slab?

 

[Mindmaster]

I just got a M class back for our PPOR land and they were talking waffle slabs and I knew I had seen them recently then I remembered it was your thread.

They look much taller than a normal slab?

Hi WM, I have not been onsite so the only thing I know about waffle slabs is what I've researched online. A typical waffle slab should be 225mm from the base to the top of the foam with a 85mm layer of concrete on top of that.

If you need more detailed info, I suggest you email/pm Oscar but don't tell him I sent you

 

[Mindmaster]

The frames for the single floor units 2 and 3 are finished and the frame for the double floor unit 1 is almost finished.

 

[SamL]

Looking great! Would love to do something similar in the next 18 months or so, but will have to see how my current situation works out.

I can't say I am a fan of waffle slabs. I know they are a cheaper 'solution' but with our soils here in Melbourne they are prone to issues.