I am after a bit of advice from all of you knowledgable people….
My husband and I have been looking at doing an investment for some time now – preferably a doer-upper to sell straight away.
An opportunity has arisen in which a guy is going through a divorce and is moving back home with his mother. It's an urgent sale as he's stopped paying the mortgage and if he doesnt sell now the banks are about to foreclose on him.
The house is a 9 yr old 3 x 2 property in a low – middle class area of Perth about 15-20 mins north of the city (Beechboro). The property is set on an acre block which is unable to be subdivided at the moment due to the fact that there are big power lines at the far end of the acre (no-where near the house) but still on the property, which is preventing it from being sub-dividable. The acre however may be used for several purposes – ie market gardens, live stock, business use – ie tow truck or car yard business or any other personal use. The house is in need of some interior work such as paint, new floor coverings, updated kitchen + bathrooms but nothing too severe. The main work that is required is on the outside of the property which needs a major clean up and overhall.
I can secure this property for $380,000 and am asking everyone here if you believe it is a worthwhile investment or not. We have calculated that we would need to spend approx $30,000 to bring this property up to scratch. Any feedback would be greatly valued.
ROI – return on investment, its a numbers game, especially if you want to sell straight away.
Spend $380,000 plus buying costs of stamp duty 4%, finance fees, settlement costs and you are up to around $400,000, then add the $30,000, you would then have to work out what it would be worth? It would need to be considerably worth more than $430,000 given holding and selling costs and the fact you want to return a profit. In this regard you should check REIWA and RPData for sales history and do your research before jumping in to see if the project stacks up.
Thanks for your reply RHPlanning.
I think this is half my problem – there's no available data on this type of property as no properties on
acre blocks have ever sold in this area. Even after speaking to a couple of agents it's very hard to know how much this property will sell for at the end of the day. Any ideas how I can be a bit more specific with the final outcome?ps…..the reason why no acre blocks have ever sold in this area is because there are only about 10 in existance in this area and since they were all built upon approx 9-10 years ago not one property has tried to be sold.
Buy an option to purchase whicj might help the vendor keep the Bank away a little longer and advertise it immediately, if there is scarcity you might be inluck.
cheers
thecrestthecrest | Tony Neale - Statewide Motel Brokers
http://www.statewidemotelbrokers.com.au
Email Me | Phone Meselling motels in NSW
Hi Thecrest I actually think it's too late to explore this option.
Are there any other suggestions as to how I could find out the real value odf this property and if it will be a worthwhile project for us?
Also, if you read this message could you please put a simple 'yes' or 'no' below to let me know if you would consider this investment worthwhile or not?Thanks in advance.
Pay a professional valuer to put a value on it pronto. It'll only cost about $400
Jacqui Middleton | Middleton Buyers Advocates
http://www.middletonbuyersadvocates.com.au
Email Me | Phone MeVIC Buyers' Agents for investors, home buyers & SMSFs.
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