Adelaide splitter blocks

Discussion in 'Development' started by Erica, 18th Dec, 2015.

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  1. Erica

    Erica Well-Known Member

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    That one is City of Holdfast Bay, Residential Zone, the minimum allotment size for a detached or semi detached dwelling is 350m sq. House is set too far back, not suitable for a retain, but meets requirements for demolish and subdivide. (Min 12m frontage for detached and semi-detached).

    Keep in mind, if you are looking for a site to retain and subdivide you also need to provide Private Open Space and a carport.
     
  2. Erica

    Erica Well-Known Member

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    @MTR
    I appreciate your comments, indeed 20% return on investment is a much better benchmark to aim for. My first project I aimed for 20% and if I had sold on completion would have made 0%. My second project I aimed for 20% and after all sold down with take away only 10%. Costs sure do blow out and unexpected things always pop up.

    I guess my willingness to reduce ROI stems from A.being more experienced at costing up the project, and B. the quick turn around -6mths.

    How do you manage to find sites that are below market value or stack up to 20%+? Do you have a realestate agent who brings you sites before going to public market? Do you letter box drop?

    It is frustrating, all the publicly listed sites just aren't selling cheap enough to achieve 20% -there is always competition from home owners that have all been watching the Block and are prepared to give a reno a go, or from what I can gather- a builder prepared to take a smaller margin on the land because they are also adding a margin on the build.
     
  3. jim1964

    jim1964 1941

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  4. s_andy

    s_andy Active Member

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    What about building under the rescode?
     
  5. Erica

    Erica Well-Known Member

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    It sill isn't possible because you can't get the minimum area required.

    I'll reiterate from my earlier post:

    you can only use the Res Code private cert method if your proposed allotment
    1. has it's own street frontage
    2. meets the minimum requirements for allotment size as per councils development plan zoning
    3. meets the min frontage width, again as per the Council's development plan/ zone.

    And there are many other requirements that need to be met, this is just a few of them, private certification is NOT a strategy to get all non-complying developments past council, it just has a few requirements that are more lenient.

    I suggest you have a really good read of all the information you can get online and also talk to a town planner and building consultant who is familiar with the minimum requirements in the Zone you are looking to buy into (I am not a qualified town planner, just someone who has done a couple of subdivisions before, and am in no way an expert.)



     
    Last edited: 11th Jan, 2016
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  6. Erica

    Erica Well-Known Member

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    check list here:
     

    Attached Files:

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  7. MTR

    MTR Well-Known Member

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    Basically via re agents and networking with various people/investors. My last 3 deals I purchased the land well under market value. One particular bank valuation came in at $120,000 above purchase price which is unheard of, even my broker (@Shahin_Afarin) was gobsmacked. Problem is you can not use these agents to sell your properties so then you have to find another re agent that under sells, not necessarily easy.

    I also like to network with people who are doing what I want to achieve successfully and basically do the same if possible. I don't know whether you can network with investors that are sourcing deals/developments and just piggyback on this, why reinvent the wheel.

    It actually becomes harder to source suitable development sites in a rising market because its so hot and you have so much competition.

    I think the strategy that is working OK for sourcing sites is developing a close repour with an agent in your target area who will work with you. This takes lots of time, and lots of phone calls but you also have to be ready to pull the trigger when a suitable property hits the market. There is also an element of luck I am sure with this, just being in the right place at the right time.

    Marisa:)
     
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  8. s_andy

    s_andy Active Member

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    Thanks Erica, very helpful. I only noticed your earlier post about the same issue just now!
     
    Last edited: 11th Jan, 2016
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  9. Erica

    Erica Well-Known Member

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    thanks MTR, all excellent advice.

    I am finding most development blocks in Adelaide are going to Action at present, so there is not a lot of opportunity to buy under market value, but I will keep trying.

    I will work on building a relation-ship with agents in my area. I think this aspect will hopefully improve later this year when I sell off my first house. Hopefully the agent I have in mind, will see me as a potential long term client and potential income stream and be more inclined to bring me some deals (fingers crossed)
     
  10. s_andy

    s_andy Active Member

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    Am I interpreting it wrongly but doesn't the Holdfast Bay DP have a minimum lot size for detached dwellings of 400sqm and semi-detached or group dwellings 350sqm?
     
  11. Erica

    Erica Well-Known Member

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    You are interpreting correct, sorry I did say above 350m sq for both detached and semidetached- that was incorrect, we have the blind leading the blind here :) Below is a cut and paste strait out of the development plan:

    7 A dwelling should, except where specified in a particular policy area or precinct, have a minimum site area (and in the case of group dwellings and residential flat buildings, an average site area per dwelling) and a minimum frontage to a public road not less than that shown in the following table:

    Detached Dwelling type

    400 minimum Site area (square metres)

    12 metres Minimum frontage (excluding hammerhead type)

    Semi-detached

    350 minimum

    12 metres

    Group dwelling

    350 average

    12 metres

    Residential flat building

    350 average

    12 metres

    Row dwellings

    350 average

    10 meters
     
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  12. MTR

    MTR Well-Known Member

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    I buy in Melb, and most go to auction as well, even so you need re agents on your side just gives you an edge.

    good luck
     
  13. Erica

    Erica Well-Known Member

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    MRT, what is the minimum % Return on Total Investment (ROI) you would accept on a simple bulldoze split into 2 and sell off land?

    I've seen others doing these Adelaide in 6mths but I'm conservative so always factor in min of 12 mths holding costs. (My quickest one took 14mths, and slowest 2 yrs :eek:, but I think I've got the hang of the process now, aiming for 6 this time around.)
     
  14. MTR

    MTR Well-Known Member

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    If it's low risk and quick turnover then if you can make 10-15% and it pays more than your day job why not, there is no rule. Money is money.

    But low risk means you know it will sell for the price you want and a quick sale otherwise holding costs will hurt.
     
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  15. s_andy

    s_andy Active Member

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    Thanks Erica. Does anyone here have experience with group dwelling developments? Would it be classified as a group dwelling if you build say 2 detached houses on a hammerhead lot?
     
  16. Corey Batt

    Corey Batt Well-Known Member

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    "Group dwelling" means one of a group of two or more detached buildings, each of which is used as a dwelling and one or more of which has a site without a frontage to a public road.

    Financed a fair few of them - returns are generally hampered by the fact that anything with any sizeable land these days believes they're sitting on a gold mine, whilst strata properties generally aren't appealing to the majority of buyers so values reflect this.
     
  17. Erica

    Erica Well-Known Member

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    @Corey Batt

    Can I pick your brain for a minute on financing a knock down & subdivide?

    Scenario: say I set up the loan from the outset with 80% LVR, once I have development plan consent granted and demolition of the original dwelling is ready to commence, I'll need to get permission from my lender to demolish, so I believe, and at this point since I will be reducing the value of their security I will need to top up the loan to the amount that they value a vacant block of land at, BUT- do you know of any lenders that will at this point in the subdivision (uncompleted) value on the 2 new vacant allotments (without new titles being issued) rather than the whole allotment?

    The problem is that the 2 new titles won't be ready until the existing dwelling is demolished, the surveyor has pegged new boundaries, the new second water meter and sewer IP is installed. The Development Assessment Commision only rubber stamps once everything is all completed. I expect this delay will take a few months from demolition. Finding a lender who is happy to put up with the temporary reduction in security value rather than making me top up the loan, will save me having to inject more of my precious capital.
     
    Last edited: 13th Jan, 2016
  18. D.T.

    D.T. Specialist Property Manager Business Member

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    Not a broker but you'd have to wait for titles I assume so they have something to lodge security over?

    When I did mine the 2 new blocks each valued at nearly the same as the original.
     
  19. s_andy

    s_andy Active Member

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  20. jim1964

    jim1964 1941

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    This is already 2 titles,actually its across the road from my 64-66 Standen St division.The price reflects the home plus the land cost,so little to be made here,once buying fees are included,there would be better options.
     
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