Townhouse development

[hiddencharm]

I currently have an opportunity to acquire a block of land about 1450m2 R3 zone (30x45). I'm thinking of building townhouses on it. The land itself would be around 3.3M. Is it feasible for a project like it or the land is just too expensive?

Thanks in advance

 

[Biz]

If you cant answer that question yourself you shouldn't proceed.

 

[A Jeremy]

In the nicest way possible, if you're providing that little detail and asking an online forum if you should sink $3.3mil into the land I think you need to take some more time to research the field and gain a better understanding of the game.

 

[Mamaof3]

Agree with the other posters, $3.3M is a huge amount of money to invest and without knowing or providing more information about what the zone allows for, constructions costs, resale values etc, its impossible to give any type of feedback.

Would however definitely not recommend doing a multi million dollar development like this if its your very first unless you've got millions to burn and wouldn't be affected if the deal didn't return a profit or even left you in the red...significantly in the red.

 

[Scott No Mates]

1450 m2 - how many t/h will this yield?
Does the site have a DA?
How long will it take to get the DA?
Is there any holding income?
Are you buying off market or through an agency?
What LGA?
Do you know the construction cost and end market values?
How long is the build time?
What is the irr and npv for the development?

Now to more relevant details.
How are you going to fund the purchase? construction?
Do you have a track record in project delivery?
Are you targeting otp sales?

 

[DaveM]

Just buy it regardless of the numbers. Real developers make the numbers up as they go. You can just bank on ongoing growth and increase the sale price to recover your margin at the end

 

[sanj]

agree with previous posts, any development site needs a good amount of DD done on it and at first glance it appears you don't have the experience for it.

Start with some thing smaller

 

[oc1]

Nah bro, maybe at $3M. Then you can make a safe 5% return.

 

[A Jeremy]

DaveM tells the truth that no one else is willing to.