Advise on selling development site with neighbours

Discussion in 'Development' started by Morris, 12th Dec, 2017.

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  1. Mel Morgan

    Mel Morgan Sydney Property Manager Business Member

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    It sounds like you won't be able to get through this without experienced professional help (plus individual owners may listen to an experienced 3rd party somewhat more). Maybe @Paul@PFI 's son can assist you?
     
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  2. Something_Wrong

    Something_Wrong Well-Known Member

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    So the people with twice the size block should not expect twice the $$ over the smaller blocks, they should only get approx. 30% more.
     
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  3. Paul@PAS

    Paul@PAS Tax, Accounting + SMSF + All things Property Tax Business Plus Member

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    Depends where property is. North West Sydney ?
     
  4. Morris

    Morris Member

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    Yes, North West Sydney
     
  5. Ethan Timor

    Ethan Timor Well-Known Member

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    My 2c:

    The way I see it, all the blocks that are in play are in the same boat.

    They could all get a certain market price for their individual lots but since they are all teaming up, they all enjoy the surplus profit they'll collectively fetch.

    The most fair way to distribute the profits? Evenly, based on existing market price. This way everyone makes the same profit margin.

    Quick example: 2 lots, one worth $100k, the other $900k, selling both to dev for $2m. Extra profit is distributed according to market values so small lot makes $100k and big lot made $900k. Seems fair to me :rolleyes:
     
  6. Morris

    Morris Member

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    @Ethan Timor , thanks for that. This is an ongoing topic within the group. We came up with 5 different ways to apportion any proceeds because everyone has stated their min "price".. so its not an easy topic and one that I haven't been able to find much info on the internet. The obvious challenge is getting everyone on board with the same apportioning methodology which isn't as simple as it sounds.

    I will post more in the new year once we resume discussions.

    Happy new year folks!
     
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  7. Happy 84

    Happy 84 Active Member

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    Morris how did this pan out ? I e also got a property due to be rezoned r2 to r4 high rise I. South west SYDNEY. Did yours sell and if so how did you all come to agreement?
     
  8. Morris

    Morris Member

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    Hi @Happy 84
    More than a year on, and unfortunately (or fortunately depending on which way you look at it).. the rezoning is nowhere close to even being released as a draft let alone for public consultation. Therefore we never moved to far into a MoM which was the intent. However, we had shortlisted two very well known property agents to drive our campaign and both strongly advised our group that sqm is the best way, but noted that its not for everyone in the sense that we either all jump onboard with it or consider not going ahead. The sale price and how its distributed is the most difficult issue, all other issues there are experts to guide what you dont know.

    Anyway so thats where we are at. Once we hear a draft is out we will re-gather. But given stations are due to open q2 next year, its unlikely this will happen before it (my opinion).

    Good luck with yours, all the best.
     
  9. Happy 84

    Happy 84 Active Member

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    Thanks Morris would you mind messaging me the agents details as I’d like to have a chat to them.
     
  10. Morris

    Morris Member

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    Frank Knight where very professional and take time to listen.
     
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  11. Milop

    Milop New Member

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    Hi Terry,
    A registered valuer( paid for service ) as an alternative that a real estate valuation?
     
  12. Milop

    Milop New Member

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    “real estate agent”
     
  13. Scott No Mates

    Scott No Mates Well-Known Member

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    Real Estate Agents are not valuers and provide a market appraisal (ie they are wheting your appetite by flagging what you might get if the gods are smiling on you). A valuer will provide a rational (and legally substatiated) figure for the property/development. It may or may not sell for that amount - that is for the agent to achieve via their marketing & negotiation skills.
     
    Milop likes this.
  14. Terry_w

    Terry_w Lawyer, Tax Adviser and Mortgage broker in Sydney Business Member

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    Up to the parties on how they contract to work this out. You could also use numbers in a hat!
     
  15. Milop

    Milop New Member

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    OK, some guesswork involved then? But let's say an agent (who specialises selling development sites involving multiple owners) offers a price opinion(to win the business) that is almost 50% more than a 'guessed at' market price for a singe property for a fee in the range of 2% commission. Sounds reasonable?
     
  16. Terry_w

    Terry_w Lawyer, Tax Adviser and Mortgage broker in Sydney Business Member

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    It might sound reasonable to me, but there will probably be at least one neighbour who thinks it too low.
     

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