You'd have to find a friend/friend of a friend willing to hold your hand or someone that teaches for a living i suppose. Most builders/developers would be too busy to mentor. It's a tricky one as there are no decent books or courses on developing that are that in depth.
What does profit margin tell you in a development feasibility study? Not much?
- Thread starter evan1875
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You'd have to find a friend/friend of a friend willing to hold your hand or someone that teaches for a living i suppose. Most builders/developers would be too busy to mentor. It's a tricky one as there are no decent books or courses on developing that are that in depth.
Oc, will you be my mentor? In return I'll wash your car for a year
Maybe you can throw in a free kitchen or two
Ace,
Most people though can't afford a wipe-out type of mistake for their first venture. It will set them back years.
And the gut feel may be an instinct for a true talented entrepreneur, but for most people it comes after some experience.
Can't wait till I ditch that calculator / spreadsheet
There are many factors behind being successful in a chosen field and property development is no different.
The desire must be strong and sincere enough to take concrete action. If you want to find a mentor you have to seriously look for one. Thinking "why would they bother" is not the attitude to maintain.
You have to walk on the path sincerely, honestly and with strong committment. There are many famous mentors who write and speak about this to motivate their audience but each individual must follow the steps and take action.I have found Napolean Hill's 9 lectures (rare recordings) and Jim Rhoan's Take Charge of Your Life excellent material. (many hours of listening between the two) I don't blindly beleive all what they say but most of it resonates with my philosophy and experiences.
As far as property specific material goes I began with M. Yardney and Jan Somers books which motivated me to embark on the first duplex. I attended a few seminars as well but most importantly I took action which involved some calculated risk. Did I get "lucky" or did I create the success with sincere determination backed by sufficient education and common sense?
Hill says the starting point of all achievment is "definiteness of purpose". It must be accompanied by a definite plan for its attainment followed by appropriate action.
Hope this helps.
I haven't got a builders licence but I'm a landscaper by trade.
I do the following:
find sites that stack up financially and comply with council requirements
negotiate the contract
organise survey plan
provide a brief to my architect who provides my house plans
assemble and lodge the DA
organise engineering detail
once approved lodge the CC
organise Home owner warranty insurance with my builder
source material quotes
line up tradies (all regulars now)
project manage the construction stage
finalise landscaping
finalise strata subdivision
finalise sale or rental
My builder and I work in together. The more I can do the the less he has to charge me. This is not a common practice but it works very well for us because he can focus on the hands on construction without worrying about coordination of other tradies and materials. He has built my past 8 homes and will be building another five houses over the coming 12 - 18 mths.
I do the following:
find sites that stack up financially and comply with council requirements
negotiate the contract
organise survey plan
provide a brief to my architect who provides my house plans
assemble and lodge the DA
organise engineering detail
once approved lodge the CC
organise Home owner warranty insurance with my builder
source material quotes
line up tradies (all regulars now)
project manage the construction stage
finalise landscaping
finalise strata subdivision
finalise sale or rental
My builder and I work in together. The more I can do the the less he has to charge me. This is not a common practice but it works very well for us because he can focus on the hands on construction without worrying about coordination of other tradies and materials. He has built my past 8 homes and will be building another five houses over the coming 12 - 18 mths.
This is my self created full time job. I don't receive any income other than rent from the IP's we have held and the houses we have sold. I eased into this from being a landscaper - slaving away for 30k a yr! Actually the work was quite interesting but heavy labouring most of the time.
Now the work is less labouring, more interesting, more personally rewarding and has set us up financially for early retirement if we should decide to stop in another year or two.
Carrying out development projects while holding down a full time job, I'm sure, is a whole different ball game with a completely different strategy as far as finances and time management go.
It would have to be carried out along the same lines as my first duplex project where I contracted a project home builder to build and manage the entire job from DA stage to completion (apart from landscaping and driveways). It was an ideal site for a first timer. The block was flat, large and satisfied all of council requirements. With a duplex, you make the money out of splitting the block and creating a second title. For this reason I would expect that you would profit more where land values are higher. The difficulty is that you require a greater capital outlay to fund the project. My land purchases to date have all been between 210k - 265k. Council contributions in my area amount to around 30k for a dual occ approval. Our first block was purchased for 210k.
Rough figures were:
Land 210k
Council 30k
Contract for 2 houses 293k
Interest 10k
Strata Subdivision 7k
Miscellaneous 10k
Total 560k
Sale of house 1 - 405k
Sale of house 2 - 385k (private)
Agent fees - 10k
Total sales minus agent fees - 780k
After tax taken out we made around 190k and the project was completed in around 12 mths. We sold the first house immediately. We rented out the second house for over a year prior to selling it to my wife's sister as an IP. Therefore tax for H2 was calculated using the 50% capital gains discount (income split between my wife and I)
We try to limit our new house sales to 1 per financial year so as to avoid paying higher amounts of gst and income tax. This works very well for us and legally limits our tax burden.
As a comparison of strategy, my most recently completed duplex project was a purchase of an existing house.
Figures were roughly as follows.
Existing house on 940sqm - 330k
SD and legals - 12k
Renovations - 20k
Construction of new house + strata subdivision, landscaping, etc - 186k
Agent fee - 12k
gst on sale - 10k
Interest - 10k
Total Cost - 580k
Sale of new home - 410k
Value of existing home - 400k
Financial Gain - 230k (timeframe 14 mths)
We actually moved into the renovated existing house prior to the construction of the new house. The existing home will be sold as PPR (tax free) when we complete our current duplex project in a few months. We will move into one of these new duplex units and it will become our new PPR. Things will roll on from there to the next project which will be our first 3 unit development. DA for this project will be lodged in the coming weeks once settlement on the land takes place.
As they say, "it's all happening"
Now the work is less labouring, more interesting, more personally rewarding and has set us up financially for early retirement if we should decide to stop in another year or two.
Carrying out development projects while holding down a full time job, I'm sure, is a whole different ball game with a completely different strategy as far as finances and time management go.
It would have to be carried out along the same lines as my first duplex project where I contracted a project home builder to build and manage the entire job from DA stage to completion (apart from landscaping and driveways). It was an ideal site for a first timer. The block was flat, large and satisfied all of council requirements. With a duplex, you make the money out of splitting the block and creating a second title. For this reason I would expect that you would profit more where land values are higher. The difficulty is that you require a greater capital outlay to fund the project. My land purchases to date have all been between 210k - 265k. Council contributions in my area amount to around 30k for a dual occ approval. Our first block was purchased for 210k.
Rough figures were:
Land 210k
Council 30k
Contract for 2 houses 293k
Interest 10k
Strata Subdivision 7k
Miscellaneous 10k
Total 560k
Sale of house 1 - 405k
Sale of house 2 - 385k (private)
Agent fees - 10k
Total sales minus agent fees - 780k
After tax taken out we made around 190k and the project was completed in around 12 mths. We sold the first house immediately. We rented out the second house for over a year prior to selling it to my wife's sister as an IP. Therefore tax for H2 was calculated using the 50% capital gains discount (income split between my wife and I)
We try to limit our new house sales to 1 per financial year so as to avoid paying higher amounts of gst and income tax. This works very well for us and legally limits our tax burden.
As a comparison of strategy, my most recently completed duplex project was a purchase of an existing house.
Figures were roughly as follows.
Existing house on 940sqm - 330k
SD and legals - 12k
Renovations - 20k
Construction of new house + strata subdivision, landscaping, etc - 186k
Agent fee - 12k
gst on sale - 10k
Interest - 10k
Total Cost - 580k
Sale of new home - 410k
Value of existing home - 400k
Financial Gain - 230k (timeframe 14 mths)
We actually moved into the renovated existing house prior to the construction of the new house. The existing home will be sold as PPR (tax free) when we complete our current duplex project in a few months. We will move into one of these new duplex units and it will become our new PPR. Things will roll on from there to the next project which will be our first 3 unit development. DA for this project will be lodged in the coming weeks once settlement on the land takes place.
As they say, "it's all happening"
Thanks Rockstar.
You have well and truly found your niche. Like the way you work. Margin in the end does not mean as much as knowing that you are looking at X amount of gain in Y amount of time, give or take a little.
By doing a few you probably also have trial'ed and error'ed a few members of your team. That in itself makes the process more predictable and therefore less unknowns and risks.
Hope that state of developing is where I will end up one day.
You have well and truly found your niche. Like the way you work. Margin in the end does not mean as much as knowing that you are looking at X amount of gain in Y amount of time, give or take a little.
By doing a few you probably also have trial'ed and error'ed a few members of your team. That in itself makes the process more predictable and therefore less unknowns and risks.
Hope that state of developing is where I will end up one day.
