[christianbParticipant@christianbJoin Date: 2009Post Count: 386]

December 2, 2010 - 11:54 pm

In developing property you will need ready access to a whole host of service providers including geotechnical engineers, land surveyors, planners, architectural drafters, structural engineers and some legal advice.

Look for someone who has done what you are proposing to do. They'll understand the ins and outs, will have the contacts, and will hopefully steer you away from potential pitfalls.

And good luck with the project.

[christianbParticipant@christianbJoin Date: 2009Post Count: 386]

December 2, 2010 - 11:47 pm

Yes, it's a busy time of year alright.
And thanks DWolfe for the recommendation. This is the first time I've read the posts for a couple of weeks.

The first and most important thing you need to do Frankston Fella, is to understand the planning overlays for the specific area. Different areas allow different densities. Proximity to services and transport is usually a good indicator of higher density overlays.

A corner block enjoys set back dispensations and can also allow titles without common property if designed well. A density of 6:950m2 (1:158m2) would be unusual but perhaps possible in higher density areas.

Good luck with it.

[christianbParticipant@christianbJoin Date: 2009Post Count: 386]

December 2, 2010 - 11:38 pm

226m2 – that's a small site!

Generally speaking, for a subdivision like that to be approved there will be either plans and permits approved or a S173 agreement setting out the requirements for future use of the land. This information should give you a good guide as to what is currently permitted for the land.

If what you would like to do doesn't accord with what has been permitted, it is not an easy process to make any meaningful amendments, and it takes some time. Whilst the 65% rule is flexible, the intent is not. This rule is in place primarily to encourage the articulation of the built form – that is to say – no "slab sided" construction.

Hope that helps, and good luck with it.

[christianbParticipant@christianbJoin Date: 2009Post Count: 386]

October 8, 2010 - 4:40 am

Yes, you can. Just. And DWolfe, I would also endorse your Sunshine recommendation.

[christianbParticipant@christianbJoin Date: 2009Post Count: 386]

October 8, 2010 - 4:05 am

In my opinion, the best value – by a long way – seems to be the area between Heidelberg and Preston. It's close to town, well serviced, only just begun gentrification, and has liberal planning regulations.

[christianbParticipant@christianbJoin Date: 2009Post Count: 386]

October 6, 2010 - 6:29 am

Hi Simonehelene,

Some great advice from Trev there.

Ultimately, having a plan is the most useful thing you can do.

There are professionals out there that can help with all of the elements that need to come together for a successful development, but you – as the developer – need to have the plan and the will to carry it out.

In the first instance you need to assess whether the property can be legally and practically developed as you propose. And, of course, be done profitably.

Some really rough rule of thumb to get you started:

A) Assume a density of 1:300m2. This won't always play out, but it will usually.
Assume build costs of $1,500/m2. This is a good starter and will provide a reasonable level of finish.
C) Assume a further 10% on top of this for infrastructure.

Put these together, and you have enough information to know if you should further the research.

Happy hunting.

[christianbParticipant@christianbJoin Date: 2009Post Count: 386]

October 6, 2010 - 6:21 am

Here's a few methodological suggestions:

A) Land within 500m of railway stations is currently being rezoned for higher densities.
Apartments offer a higher density yield than houses.
C) A consolidation of two neighbouring lots will often generate a higher density/m2 than the lots individually.
D) Establish a feasibility template of your own understanding that you can use to quickly assess properties.
E) Talk to the agents in your target areas. They know a lot….they also talk a lot!

Good luck.

[christianbParticipant@christianbJoin Date: 2009Post Count: 386]

October 6, 2010 - 6:15 am

Hi Tahlie,

It's not that difficult, but it does need to be clearly laid out, and all the important details agreed.
What you are really proposing is two transactions:

A) You will buy land from "his mother"
You will build a new dwelling for "his mother".

Any discount being proffered in either direction can be captured within these two transactions.
There will be a transfer of land when the land is subdivided, which will trigger stamp duty.
If this is mother's PPOR one would expect there is no CGT on the sale.

My advice would be to draft a simple HOA (heads of agreement) for each of the transactions, outlining the expectations and responsibilities of each party and take this to a property lawyer to formalise the agreement.

Sounds like a good opportunity, good luck with the proposal.

[christianbParticipant@christianbJoin Date: 2009Post Count: 386]

October 1, 2010 - 4:30 am

Hi TK,

Some good advice already.

There is a process (alluded to by Michael) that is quite complex and time consuming. As also mentioned there may be other restrictions – beyond town planning – that could preclude development. A covenant will show up on a title search, or if the property is for sale then within the contract S32.

In short, here's what ahead of you:

1. Assessment: Assess the proposed project. Is it possible and is it profitable?
2. Strategy: Devise the strategy for your project.
3. Concepts: Prepare concepts for town planning and building "trouble-shooting".
4. Application: Make application for your TPP, and obtain your TPP
5. Detail: Convert your planning documentation into working documentation
6. Build: Build the property while formalising the subdivision
7. Realise: Either rent or sell.

Good luck in your research and ultimately good luck with your project.

[christianbParticipant@christianbJoin Date: 2009Post Count: 386]

October 1, 2010 - 4:12 am

Hi Joe,

What you are proposing to do is to become a property developer.

And as pointed out above, your primary responsibility (after getting the right financial structure sorted) is to get the right team together to deliver your project. You will need sound advice around the design and delivery, and of course it all has to fit within the state and municipal planning requirements.

My advice to you, at this stage, would be to write down your plan even if you don't yet understand all that you want to achieve with your first subdivision. This way, you will have a useful stepping off point for the early consultations and hopefully your initial goals will largely remain intact.

Property development is expensive and complex, but in my opinion it need not be difficult. So determine how much time you can put into the process, write down your simple plan, and best of luck with the project.

[christianbParticipant@christianbJoin Date: 2009Post Count: 386]

September 24, 2010 - 1:52 am

Hi Bec,

It seems, on the face of it, the land is fit for subdivision (it is probably large enough). In fact, it's possibly large enough to subdivide into 3 allotments – I'm sure that would make some interesting dinner table conversation.

The LTO will no doubt want some money for the transfer of title, and in any case it's probably a good idea to ascribe a value to the property even if it's being gifted to you.

But before you get down to the details you need to ascertain if the property can be subdivided in the first place, and the planning department of the governing council is a good place to start. Simply ask them if there is anything precluding the subdivision of the land and the construction of a second dwelling.

[christianbParticipant@christianbJoin Date: 2009Post Count: 386]

August 27, 2010 - 5:14 am

Old Man Jim,

What you are proposing is reasonably unusual in my experience. If this is a suburban property there will almost certainly be a need for a TPP (DA) for the subdivision. The Rescode density requirement is (generally speaking) 1:300m2, but this doesn't necessarily mean each allotment needs to be 300m2, rather that the sub-divisible land should support the ratio.

Everything else being equal one would assume that two separate houses on two separate allotments would be considerably more valuable than two houses on one allotment. You may not need to sell one to realise the value, instead you might consider subdividing and revaluing the separated properties as they would then be separate securities from the financiers point of view, therefore your equity will have increased and your ability to leverage will have improved.

Best of luck with the project.

[christianbParticipant@christianbJoin Date: 2009Post Count: 386]

August 13, 2010 - 4:07 am

It's important to know that you are the person most likely to want the property most, as it is most valuable to you as a consolidation opportunity. So unless the other person he's talking to is the neighbour on the other side, wait.

[christianbParticipant@christianbJoin Date: 2009Post Count: 386]

August 13, 2010 - 4:02 am

Hi Rookie,
If you don't yet have a TPP you will most probably need one to build your duplex. If that's the case just make sure your architect/designer is familiar with planning laws and processes as well as design.
Best of luck with your project.

[christianbParticipant@christianbJoin Date: 2009Post Count: 386]

August 11, 2010 - 1:11 am

An architect will commonly charge a fee based on the project costs (5% – 10%) but it is not unusual for an architect or building designer to agree to a fee based on the project and the work involved rather than the size or cost. There is a big difference in the work involved in preparing a town planning application and completing the working drawings.

[christianbParticipant@christianbJoin Date: 2009Post Count: 386]

July 9, 2010 - 12:38 am

It is incumbent on the financier to ensure they are protecting their shareholders from any unnecessary risk. This means they may lend to you if you can show how their risk is mitigated.

I have purchased unfinished properties, but the process is not simple. There needs to be a professional analysis of the status of the building and all of the permits and insurances that go with it. In my opinion it needs to be a real bargain to make it worthwhile.

[christianbParticipant@christianbJoin Date: 2009Post Count: 386]

July 9, 2010 - 12:32 am

Deeply embedded in the NRAS requirements is an explanation of what is "new". This may be found in the FAQ log.

[christianbParticipant@christianbJoin Date: 2009Post Count: 386]

July 9, 2010 - 12:31 am

Hi Sash,

In considering the value (or otherwise) of land fit for development, the following is common:

1. Find the right property by checking the zoning and overlays will suit the purpose.
2. The first exit point can be the issuing of the TPP (DA) and if done well will generate significant profit.
3. The second exit point is the sale of serviced and subdivided land. This means you, as the vendor, can sell smaller parcels to more people.
4. The third exit point is the sale of the proposed dwellings, as a house and land deal. This can be done by selling the property for a set amount "as if complete" and the purchaser enters into a contract to build with a builder who you have already negotiated contracts with.
5. The fourth exit point is the sale off the plan, whereby you take on the building risk.
6. The final exit point is the sale of the completed properties.

As pointed out in the thread, the value attributable to any of these exit points is really dependant on how well the figures stack up. Anyone buying land with a TPP will generally have a good handle on all of the development costs, so your assumptions about costs, values and risk will need to withstand some scrutiny.

In the case of buying or selling land with a TPP it is also common for the vendor to proffer, or the purchaser to request, the project feasibility analysis for the property.

Hope this is of some help, and best wishes in your endeavours.

[christianbParticipant@christianbJoin Date: 2009Post Count: 386]

July 9, 2010 - 12:07 am

I think Jane isolated a very important issue.
You should always have a very clear idea of what you want to achieve, and ensure you have documentation – written or drawn – that adequately communicates this.
Making decisions before you start, rather than along the way, will save time and money (and hassle).

Best of luck with your project.

[christianbParticipant@christianbJoin Date: 2009Post Count: 386]

July 9, 2010 - 12:01 am

Hi J,

Sound advice from Shannon. Always determine two things when considering knocking out a wall:

1. Are there any services (electrical or plumbing) in the wall. It's dangerous and potentially expensive if you find these the hard way! When you have removed the linings you will be able to see if any services are present.
2. Ascertain if the wall is bearing any load. Again this could be embarrassing to learn the hard way!

As for removing the tiles, they do sometimes come away in large sections on the sheet to which they are attached. That's to say you could try removing the whole sheet rather than individual tiles.

Good luck with your project.