澳洲Australia property Only buying blocks that can be subdivided


在澳大利亚 The pool at of an IP needs to be resurfaced (or so the pool doctor says), the cost was estimated to be $10K ($10,000), after recoverying from my impresssion of a cat coughing up a fur ball, it just seems far too much. Its just a standard poo I need some advice regarding a property purchase. Property - semi-detached house Bedrooms - 2 Condition - average needs internal reno to modernise Street - one of the best in suburb Location - excellent Close to schools - yes Transport - 50m


When people discuss purchasing an IP they often base a lot of their decisions on the land size and whether the property has the potential for sub-division.

My question is do people only buy properties that can later be sub-divided or are others' plans to continue to purchase houses on sizable blocks of <600sqm to keep adding to their portfolio? I just cannot see myself wanting to be sub-dividing and building houses in the future - i'd rather just keep purchasing houses.  

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Lots of different ways of investing in property, Lilli.

You do what works for you.
:)

Caroline  

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I'm in the 'only subdivisible' camp. Unfortunately prices have shot up so much lately and people are actually catching on to this subdivision thing so the subdivisible ones are either overpriced or already subdivided by the time they come up for sale.

My current 'watch list' is down to *one* property now ...  

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I am another one for the land content for subdivision.

I will look at the median purchase price for a lower end of the market house on a small block and wait until I can get one for the same price being either on a larger block ripe for subdivision or 2 lots which may require a boundary realignment.

This happens fairly often normally from either a deceased estate or an agent has not taken the planning scheme into account when listing the sale price, will admit these properties will only last 24 hours on the market before being snapped up.

I am a fan of this approach for the reason of being able to add instant equity from the subdivision as well as reno on the house and having the flexibility of debt reduction of selling either the land or house down the track if required.

But each to their own.  

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I look for sub-dividable properties within 10 KMs of the CBD.  

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For those of you that are purchasing properties with bigger blocks that can be subdivided, are you subdividing the blocks and selling vacant land with plans, building the house yourself, or getting a Metricon home build...?  

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This is an interesting question. Is it really worth it in the end given costs of subdividing, loan costs during subdivision, then CGT and GST when you sell? What is the key to a successful subdivision strategy apart from buying low.  

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We're going to build to live in and sell the old house on the block. There's not much money in just selling the land.  

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Im in an area where the blocks are already subdivided in 10 metre blocks.
Most of the older homes sit across two 10 metres blocks.
I have been able to find some with the house able to be transported or turned
onto one block giving me another block ready to do something with.
No subdividing issue or charges, Just ring up the council and get them rated
at two parcels of land.
Works for me.  

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The last one on my watch list is like that but one better - it sits on two *titles*, with the original house sitting on one block clear. The other block is wide enough (a whole 19cm wider than the minimum) for a duplex.

Considering the seller is 'desperate' its been for sale for 6 months with only one small price reduction :confused:

The house is in a particularly bad state, the ad smacks of heritage listing and the price is much higher than you'd expect for 2xland + 1xdemolition special though.  

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If my numbers are correct I should be able to build a 4 by 2 finished for around $240,000 on the back of my corner block all costs included A nearby corner block did the same as I intend to do but only a 3 by 1 and it sold for the new house for $340,000. So in my situation there is a potential $100,000 profit. But I intend to hold long term as it should be cf neutral or positive straight up.so there can be many advantages with corner blocks. I have mentioned just two.  

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Anyone doing this in Sydney? Seems as though all the sub-dividable blocks have already been sub-divided :(  

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garbage said: ↑
Anyone doing this in Sydney? Seems as though all the sub-dividable blocks have already been sub-divided :(Click to expand...
Im sure there will be people that will disagree to this but generally you may have to pay a premium for a sub block. Most people if not atleast the selling agent are aware of subdividing potential. In many cases they whack sub potential on many properties that are anything but.Many look for this kind of thing so they generally sell quickly. Not sure about Sydney but i would say due to land restrictions it would be getting harder and harder.  

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So unless you're planning on sub-dividing, it isn't really worth paying the premium for a bigger block....?  

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depends how early you are in your investing career.

if you are in the earlier stages, i would say find a property with a sole-use land component (starta / free hold - whatever) and then look at branching out into subdivisible blocks once you have a few under your belt.

unless you like low yields with the hope of CG....? or a really cashed up.

each their own i guess.  

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devo76 said: ↑
Im sure there will be people that will disagree to this but generally you may have to pay a premium for a sub block. Most people if not atleast the selling agent are aware of subdividing potential. In many cases they whack sub potential on many properties that are anything but.Click to expand...
Ours wasn't advertised as subdivisible and we bought it for $15,000 more than the value of the splitter block, which is nice - means we effectively bought the existing house and land for $15k. Turns out the agent hadn't even considered that the block was subdivisible. They're a bit slow out this way.  

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RumpledElf said: ↑
Ours wasn't advertised as subdivisible and we bought it for $15,000 more than the value of the splitter block, which is nice - means we effectively bought the existing house and land for $15k. Turns out the agent hadn't even considered that the block was subdivisible. They're a bit slow out this way.Click to expand...
Your right it can go both ways.I was looking/waiting for big blocks in the central area to pop up but they rarely do in my area. Then one day up pops one. 1000+ sqm corner block.Big old house requiring quick reno after passing of 35 year tenant.And a big plus was a self contained granny flat to the back.
I had a figure in my head and initially i heard they wanted $80,000 above this. I laughed. A different agent gave a more realistic price and with me going a little above what i intended to go the deal was done before auction.
Although i feel i did pay good money for it. Comparable sales put me at ease.A similar block nearby is on the market now but at over $100,000 more. That makes me feel good.Another block nearby has subdivided like i intend to do and the sale of his new house and the old house show that there is plenty of profit to be made if i did sell.There was demand for this block before auction so with this i decided to go in at very close to my revised max and this got the property. Many prospective buyers were upset when the auction was cancelled so maybe the agent should have stuck with the auction,who knows.So in my case i did pay a slight premium but probably not as much as i could have.  

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Ours was *under* priced, which IMHO stopped it selling. Since we bought it about a year ago, a lot of houses within maybe 500m have sold. One opposite for $170k, one behind for $275k, another behind listed for $240k just sold, a tip down the road listed for $170k just sold, and two in the next street listed for $220 and $240k yet to sell. Go further than one street away and there's plenty sold over $300k.

Ours was $65k, and the average land price round here is $50-60k so the raw value of the house on two blocks should have been at least $100k (which is about what the bank valued it as). I've yet to see one even remotely close to our price come up. Land alone is creeping higher and higher, with more blocks selling for over $60k than not. This area is very popular at the moment.

Never underestimate the potential in a house everyone else is brushing off as "oh, THAT house. Why the hell would you want to buy THAT house? Didn't you hear the tenants trashed it?"  

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I love land content myself , in any shape or form even if you don't divide it or use it for 10 yrs , I'm banking the stuff . It makes me feel safely secure about the buy and it is because there's always something you can do with extra land .
To me , if you take away land content your options dump big time and the buy has to be 3x better to make up for it.

Cheers  

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blaster said: ↑
I love land content myself , in any shape or form even if you don't divide it or use it for 10 yrs , I'm banking the stuff . It makes me feel safely secure about the buy and it is because there's always something you can do with extra land .
To me , if you take away land content your options dump big time and the buy has to be 3x better to make up for it.

CheersClick to expand...
This is actually my conundrum now. Total cost to sub my block including demo of existing shed is around $43,000. Sure thats a cheap block of cbd land but it will be just under 400 sqm. A bit further out from the cbd you can get 650 sqm blocks for just over $100,000. Add into the equation i will have to build a fence to seperate new block,a new garage at $14,000 and maybe some basic landscaping and the scope for profit will reduce. Sure the land will be worth more once our slump passes but maybe i would be better buying elswhere and come back to this idea when land value rise.:confused:. Anyway back to crunching numbers for me.  

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