All Topics / Help Needed! / Capital required for subdivision?

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  • Profile photo of ariss123ariss123
    Participant
    @ariss123
    Join Date: 2015
    Post Count: 4

    Hello Property Investors!

    A friend and myself are looking to get into subdivision late this year or early next year. We are both learning the ins and outs of the process while building our capital base.

    The area in which we are looking to start in has a price range of $300k – $400k on blocks 800+ sqm. Area is in the Western suburbs of Melbourne. Due to the houses in this suburb (placement of houses), the strategy is to buy, subdivide into a battleax or hammerhead and sell both.

    During the course of our learning, we are actually unsure of how much capital we will be required to put forward ourselves.

    Our intention at this stage is to borrow 100% of the property value and use our capital to pay for expenses that will arise.

    Is there a better option when it comes to borrowing funds and what would the approximate capital base required be?

    We are yet to visit the council to determine their fees, but a rough estimate would give us an idea of how much capital we need to build.

    Any advice would be greatly appreciated.

    Thanks
    Luke

    ariss123
    Email Me

    Profile photo of Tom@SadhanaConstructions[email protected]
    Participant
    @spartantom
    Join Date: 2015
    Post Count: 18

    Without knowing the specifics $50k would in most cases cover all costs with a buffer for any unforeseen circumstances

    [email protected] | Sadhana Constructions
    http:\\www.sadhanaconstructions.com.au
    Email Me | Phone Me

    Perth builders of developments and bespoke homes

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