All Topics / General Property / Neighbours’ home for sale

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  • Profile photo of CeliviaCelivia
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    @celivia
    Join Date: 2003
    Post Count: 886

    My neighbours’ home is for sale. ALthough it would be very negative cashflow (asking price $290K, rent would be $200p/w,) I keep thinking that I want it because I could add a strip of their land to my land to be able to make our single driveway into a double driveway.
    There will be enough yard left next door for it to be a decent sized yard.

    What are your thoughts on this? Has anybody done something like this?
    I’m not sure if it would be a good idea to live next door from your tenants, but the thought of the extra land is attractive.

    Any opinion welcome please!

    Profile photo of jezjez
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    @jez
    Join Date: 2003
    Post Count: 31

    A mate of mine leases out the house next door to him (though in his case I think he may own it outright). They went exclusively through a PM so the tenant doesn’t even know their landlord lives next door! They were concerned that the tenant would feel uncomfortable if they knew, though personally I’d also be concerned that the tenant would feel overly comfortable. That is, if you get too friendly with them, they might get slack with paying the rent and it’d get to point where you’d be paying the PM for nothing (i.e. the tenant is more likely to come to you if they see you watering your flowers every morning). That said, if it’s only one property it’s probably not the biggest deal and you could probably get away without using a PM for that property (especially if the tenant is going to know you own it anyway).


    Jeremy Lunn
    Melbourne

    Profile photo of MiniMogulMiniMogul
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    @minimogul
    Join Date: 2002
    Post Count: 1,414

    you could always buy it, subdivide, adding the strip to your property, and put the neighbour’s one back on the market – probably even getting the same price as before!!
    ????

    Profile photo of KewlDudeKewlDude
    Member
    @kewldude
    Join Date: 2003
    Post Count: 76

    Hi Celivia,

    I’m a Drafting Manager for a residential builder. Over the years, I have dealt with many sub-divisions and disappointed clients when they realise that they can’t actually achieve what they had hoped for after having purchased a property they think can be sub-divided or redeveloped. Not meaning to dampen your sprits, but after reading your post, my first and foremost comment would be – prior to entering a contract to purchase the neighbouring property, contact your local authority to ensure you can achieve your aim. There are residential building codes, local by-laws and the like that dictate the minium sizes for blocks of land and so forth. So, I’d suggest some research into what you can / can’t do would be wise. Where the residence next door is located on the land may also be an issue, as there are requirements as to minium distances from boundaries, minium requirements for outdoor living areas etc. The list of potential issues is vast, and without knowing the situation, it’s impossible to be specific.

    From an investment point of view, it may also be wise to investigate the cost of the proposed re-allocation of land. You may find it to be quite costly (varies from state to state). Then in relation to the value of both properties, are you left with a favourable outcome? There will also be surveyors’ fees, fence relocation costs, cost of restoring gardens etc.

    Hope this helps
    Cheers
    Kym

    Profile photo of CeliviaCelivia
    Participant
    @celivia
    Join Date: 2003
    Post Count: 886

    Thank you people for your helpful comments.
    Kym thanks for making me aware of these issues, I will do some research and look at costs etc. Didn’t know things were this complicated.
    Regards Celivia

    Profile photo of Richard TaylorRichard Taylor
    Participant
    @qlds007
    Join Date: 2003
    Post Count: 12,024

    Celivia

    Kym is right about sub-divisions being more complicated than most investors appreciate.

    Once option subject to you minimum boundary clearances is to re-align the boundary on your neighbours side incorpating the strip of land under your title.

    You will probably have to purchase the property first to be able to do this or your neighbour may have CGT issues if he merely sells you a strip of land.

    We have done this alot with many blocks in and around Brisbane but as always check the local Town Plan as to what you can and can’t do.

    Cheers Richard
    [email protected]

    There is no such thing as a problem.
    Just a solution waiting to be found

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    Profile photo of CeliviaCelivia
    Participant
    @celivia
    Join Date: 2003
    Post Count: 886

    Bad luck, the house came on the market on Thursday and a few days later, on Tuesday, day after labour day there was an ‘under contract’ sticker on the for sale sign! My neigbours were offered the asking price. Gee 13 months ago they bought the place for $227K so they did very well. Wish I had bought it then! And I was taking my time leisurely THINKING about it! [xx(]

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