Thornlie WA

[FormerLurker]

Found this listing as I was doing the rounds:

http://www.realestate.com.au/property-house-wa-thornlie-109690221

1000+ m2 block gave me a moments thought running some numbers over it I couldn't find a way of making more than a marginal profit unless I could squeeze 4 2x1's on it.

Was running with 350k purchase 50k demo and site works 120k per build 50k holding and legal costs as rough numbers.

Anyone else think they can make this one a good development opportunity?

 

[jaycee]

Found this listing as I was doing the rounds:

http://www.realestate.com.au/property-house-wa-thornlie-109690221

1000+ m2 block gave me a moments thought running some numbers over it I couldn't find a way of making more than a marginal profit unless I could squeeze 4 2x1's on it.

Was running with 350k purchase 50k demo and site works 120k per build 50k holding and legal costs as rough numbers.

Anyone else think they can make this one a good development opportunity?

Good question

and at $349k, that'd make the price on the lower end right ?

So how does it work with blocks around the $400k mark (ie even more expensive) where the final products don't sell for too much more than in Thornlie (as described by former lurker) either.

 

[Ergophobia]

4 would be a stretch for R30, min area is 270, youve got 255 there

http://files.aussiehome.com/448/Residential_Design_Code_Table.pdf

looks like an assy roof too, which will add to your demo costs for disposal and clearance cert.

the owner has done some of the work for you, get them to give you a blank canvas and hold the price at 350k

Development cost 760k (using your numbers)
Breakeven is 253k each, id like to think you could get 350k easily

 

[FormerLurker]

The best scenario I could come up with was keep the original (maybe some reno potential) renting @ 280/week and build @ the back of the lot for 200k including holding costs and legals for subdivision etc and either sell that for maybe 270k or rent out for 250/week if held that makes it a 550k price tag and a 530/week rent situation so still not great.

All in all a lot of potential risk for limited gain on what I initially thought was a low buy in price for a triplex site. Difficult to make a good profit developing this one unless you are a builder yourself from what I can see.

 

[Ergophobia]

if you are confident in your build costs, the best result I can see is build 3 sell 2 get 1 for free, rinse and repeat

 

[jaycee]

if you are confident in your build costs, the best result I can see is build 3 sell 2 get 1 for free, rinse and repeat

I'd have thought (please remember that I have never actually done this)that was a good result

 

[FormerLurker]

if you are confident in your build costs, the best result I can see is build 3 sell 2 get 1 for free, rinse and repeat

Sadly not confident at all I licked my finger stuck it in the air and decided it was to windy for me. If I was a developer armoured in the Gortex jacket of experience I may have ventured forth on this - since I'm not I stuck it up here to tap into folks knowledge and see if they know of other options I had not seen or if my made up numbers were BS

 

[FormerLurker]

if you are confident in your build costs, the best result I can see is build 3 sell 2 get 1 for free, rinse and repeat

Build 3 for 360k all up on top of 350k buy in price with upto 100k in demo/legal and holding costs = ~800k say with a potential sale price of 900k at most.

Not sure how you achieve the build 3 sell 2 get 1 free?

edit: build 2 new for say 300k all up and sell for 500/550k if you can get 2 new on the lot around the existing starts to get it there - is this what you were thinking of?

That scenario leaves you with the old house for 100-150k.

 

[FormerLurker]

I'd have thought (please remember that I have never actually done this)that was a good result

I would say it's a great result and would jump on it in a flash - still not sure how it could be achieved.

 

[Ergophobia]

the vendor is in there clearing the site, negotiate that the vendor does the demo and gives you a clear block for 350k, this will drop the build cost to 760k (350 +120x3+50) and reduce the risk.

Sell for 350k each meaning your one cost only 60k... which is close to free.