Hi,
I’m new at this and the more I read the more confused I get.
I live in the western suburbs of Melbourne under the counsil of Hobsons Bay.My parents own a block of land which is 15.85 x 50.3 they have a 19 sq house on the front of the block and are going to let me build on the back half of the block which is about 20 x 15.85 so around 300sqm. This is where I get confused is the best way to go through town planner than subdivide so I have the title of that land, I have read that there can be some issues with subdivision and a lot of cost associated with it. Or can I somehow get around this by leaving the title in there name or getting put on the title.
Also my other issue which is more a legal one, is that my parents land is worth quite a lot estimating around $800,000, they are going to let me have the land for a lousy $100,000. As they are doing this for me to help secure a future for my children and are scared that if we get the land subdivided and my partner and I hold the title, we could separate and he force me to sell and walk away with my parents money. If that makes sense.
Does any one have any suggesstions on how to go about this from a legal and money wise point of view.
Thank you for any advice you can give me that would be great
Legaaly you could look at holding the property in a trust. I have read that you can set up trusts with yoursefl as the primary beneficary and your wife as a secondary beneficiary. Then you could specifically exclude any ex-wifes that you might have from being a beneficiary to protect yoursefl in the event of a divorce. Of course this would mean you would lose your PPOR CGT exemption.
Best speak to a good lawyer about this as it needs to be set up right.
Cheers,
LukeHi Tajone,
With the size of land you are talking about you are first going to need house plans to be approved. Assuming that something is approved your options are:
1. Build and subdivide.
2. Subdivide without building which usually entails having the house plan tied to the new title (really only for people who are looking to sell part of their land).
3. Build and leave both houses on the existing title. This means that your parents own both houses and you could live in one (rent it out probably) but it wouldn't be your asset so would be protected.Now there are obvious cons to the third option, but I thought I would point it out as it may be suitable for you. As for the subdivision being difficult, well from my perspective of seeing and handling many applications through Council I would say that getting a development approved is by far harder than a subdivision (with a development already approved) in most cases. Not to say that all small developments are hard, just that they are more likely to encounter problems than a subdivision (with an approved development).
Some Councils provide better information than others, so it may be worth looking to get advice from either a designer or private planner. As I'm located in the southern suburbs I don't know anyone out your way to recommend unfortunately.
As Luke says above, for the other questions sounds like some good legal advice is what you need.
Best of luck with your project
You be paying stamp duty for the transfer/purchase and no it wont be based on the $100,000 but based on “market value” OR contract price which ever is higher.
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Hey Thanks for your feed back so far I was discussing with my mum and we think that we might try to go about it by leaving it as one block with the one title but put my partner and myself on the title aswell and have it written up that no party of the title can will their share or force for sale. This way my partner and myself will have a morgage where as my parents don’t and Build the unit/ house if plans are approved and all permits are in order and then subdivide at a later stage if we all agree. At the moment these are just ideas, let me know what you think.
I think if we go this way I won’t be able to get the FHBG is that correct?
I know I will have to speak to many people like town planner, developer and solicitor and so forth.
But if you seperate, then your partner still owns a portion of the property? Doesnt this go against your goal of asset protection in the event of a seperation?
Luke
I don’t care if he owns it it is about him not being able to force me to sell so he can walk away with his share which will be much greater than what he came with, there will be contracts in place that won’t allow him to the only thing is that ill have to take over the morgage. Maybe I’m explaining it wrong but my mum had a contract like what I’m describing with her mum and my dad. In a perfect world I hope that it wouldn’t come to that but I want to be prepared and would really hate to have to sell a property that has been in my family for over 60yrs because we weren’t prepared.
If it is for the benefit of the children then consider making the children the beneficiaries of the trust.
As regards the planning, Ms Ellis has done a great job setting out your options.
One other option to consider is to get a TPP for the subdivision and enshrine the right to subdivide in the future.
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