Forums / Property Investing / Value Adding / 3 unit development in Epping VIC

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  • Profile photo of oc1oc1
    Participant
    @oc1
    Join Date: 2012
    Post Count: 148

    Hi all,

    This is my latest development with construction beginning today. I’m building three 2 bedroom units. At the moment it’s vacant land (corner block) located in one of the subdivisions in Epping Victoria. I bought it in January this year and just settled last week. It already had an approved Town Planning Permit/DA. Finance is approved based on 65% of end value. At the moment the numbers look like this:

    Initial costs

    Land: $308,000
    Stamp duty/legals: $16,000
    Council Application Fees: $1000
    Land Surveyor costs: $3,500
    Total Costs: $328,500

    Construction

    Total build: $250,000
    Working drawings/engineering/soil report/energy report and Building Permit: $10,500
    Subdivision (open space levy in Victoria): ZERO as it is new land where the original land developer pays
    Interest: $13,000
    Bank app fee: $2,500
    Titles & legals: $2,000
    Total Construction cost: $278,000

    COMBINED TOTAL (LAND & CONSTRUCTION): $606,500

    The units would have a combined value of about $840,000 in today’s market. I reckon these will take about 4 months to knock up if all goes well. They are about 70m2 each in living space and single story. Rents would be around $850 pw. I’m sure the figures will vary as they normally do.

    I’ve attached the floor plans (i hope it works!). I’ll put up some pics as it develops. The plumber was there today to do the underground work, followed by the concrete guy tomorrow – weather permitting

    Cheers, Oscar

    Profile photo of MRCCONMRCCON
    Member
    @mrccon
    Join Date: 2013
    Post Count: 8

    Hi, I'd love to see the floor plans, didn't seem to work.

    Also what size block are you putting them on?

    Chris.

    Profile photo of oc1oc1
    Participant
    @oc1
    Join Date: 2012
    Post Count: 148

    Hi Chris

    I’d love to put the plans up but I can’t manage to do it

    Anyone care to help?

    Cheers Oscar

    Profile photo of Daniel_95Daniel_95
    Participant
    @daniel_95
    Join Date: 2013
    Post Count: 25

    Great post, I wish more people would post these types of threads up more often. 

    Profile photo of sumnerstephensumnerstephen
    Participant
    @sumnerstephen
    Join Date: 2007
    Post Count: 34

    Hi Oscar. Great post. It's always good to read about people taking massive action. I find it very inspiring. thats what this site is all about.

    How do you plan to sell the units? On your own or through an agent?

    Profile photo of oc1oc1
    Participant
    @oc1
    Join Date: 2012
    Post Count: 148

    Hi Stephen

    I'll probably do a sell some/keep some strategy with this. The margins are good where if i sell 2 and use the sales proceeds to reduce the debt, the remaining unit will have very little debt. It will be cashflow positive by a mile and i'll have good equity to draw upon when needed.

    Cheers Oscar

    Profile photo of oc1oc1
    Participant
    @oc1
    Join Date: 2012
    Post Count: 148

    Update.

    Plumber came in on Monday and completed the underground work, including the stormwater. Also got the water tapping done. Concreter was in Tuesday. All was going well with the pre-slab work until we hit rock. Then more rock. It became an issue when larger rocks were located where the rebate was going to be. So today we had the excavator in breaking all that rock. Oh well, part of the job.

    The Easter break will pause things but we should have the slab completed this time next week, weather permitting.

    Oscar

    Profile photo of oc1oc1
    Participant
    @oc1
    Join Date: 2012
    Post Count: 148

    <img alt="" border="0" height="496" id="lightboximg0" src="http://somersoft.com/forums/attachment.php?attachmentid=10103&d=1365411092&quot; title="IMAG1013.jpg;
    966 x 545 (@92%)” width=”880″ />

    Update

    Today was one of those happy days – the concrete was poured and slabs are now complete. I have attached a couple of photos for viewing.

    Now the rest of the build can run pretty quickly. The carpenter starts tomorrow with the wall frames followed by the roof truss. Fascia, guttering and roof tiles soon after that. Could do with more sunny days like today

    Cheers Oscar

    <img alt="" border="0" height="496" id="lightboximg1" src="http://somersoft.com/forums/attachment.php?attachmentid=10104&d=1365411225&quot; style="border:solid 4px black;border-bottom-width:0px;" title="2013-04-04 11.35.07.jpg;
    853 x 640 (@78%)” width=”662″ />

    Profile photo of oc1oc1
    Participant
    @oc1
    Join Date: 2012
    Post Count: 148

    I have managed to attached the plans too smiley

    <img alt="" border="0" height="320" id="lightboximg1" src="http://somersoft.com/forums/attachment.php?attachmentid=10021&d=1363867926&quot; style="border:solid 4px black;border-bottom-width:0px;" title="floor plans.PNG;
    213 x 320 (@100%)” width=”213″ />

    Profile photo of alfrescodiningalfrescodining
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    @alfrescodining
    Join Date: 2012
    Post Count: 161

    Nice one Oscar.

    Did well to fit 3 on a tricky site like that!

    Will they be torrens title or strata?

    Profile photo of oc1oc1
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    @oc1
    Join Date: 2012
    Post Count: 148

    Thanks AC. The units will be individually titled with no common property, which is always nicer.

    The chippies have been at it the last couple of days. Everything running smoothly and to budget despite the rain.

    Oscar

    Profile photo of Tracey BTracey B
    Participant
    @tracey-b
    Join Date: 2009
    Post Count: 158

    Hi Oscar

    Great to hear everything is running to plan with your build.  Just wondering whether you're doing something particular to achieve that sort of rent?  It appears 4 bedders in Epping are asking $800+ rent so I'm guessing maybe you're furnishing them or something else?

    Cheers,

    Tracey

    Profile photo of oc1oc1
    Participant
    @oc1
    Join Date: 2012
    Post Count: 148

    Hi Tracey. I should have been clearer. I expect around $850 per week in rent for all 3 units combined.

    Cheers Oscar

    Profile photo of alfrescodiningalfrescodining
    Participant
    @alfrescodining
    Join Date: 2012
    Post Count: 161

    Hi Oscar. Will you rent them all or sell 1 or 2 of them to pay down debt?

    Profile photo of oc1oc1
    Participant
    @oc1
    Join Date: 2012
    Post Count: 148

    Sell 2 and use the proceeds to pay down the debt on the remaining unit. There won't be much debt left on it after tax. 

    Cheers Oscar

    Profile photo of BreeceBreece
    Participant
    @breece
    Join Date: 2011
    Post Count: 43

    G'day Oscar,

    Great work sharing this info with the forum. 

    It looks like a great site for you.

    It would be great to catch up for a coffee when you've got a bit of time.

    For now though, keep the wind in your sails while the Autumn sun is still shining.

    All the best,

    Breece

    Profile photo of oc1oc1
    Participant
    @oc1
    Join Date: 2012
    Post Count: 148
    Profile photo of oc1oc1
    Participant
    @oc1
    Join Date: 2012
    Post Count: 148
    Profile photo of coolharry67coolharry67
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    @coolharry67
    Join Date: 2008
    Post Count: 56

    hi Oscar the project looks great, could you please confrm if you did residential or commercial loan and which lender, also which builder as the price looks quite reasonable for 3 units. thanks

    Profile photo of oc1oc1
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    @oc1
    Join Date: 2012
    Post Count: 148

    The loan is with ANZ, commercial. Less fuss i find.

    I am also a registered builder so i project manage the build, thus the lower price. You would naturally pay more if you engage a builder.

    Cheers Oscar

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