Bad Idea? Buying vacant land in older suburb to build and best way to maximise future resell

We have been looking to buy a PPOR in Canberra for a while but kept losing auctions on the properties that we liked due to the crazy auction market at the moment. We like big blocks so we are looking into buying on older suburbs.

A few blocks of land in Canberra older suburbs (1975 homes) where the homes got demolished due to asbestos are on sale and we were thinking of building new there. We are looking for a block from 800 to 1000sqm.

For future resale value, what do you think?
Would it be better to build a larger house (220sqm living) or a slightly smaller house (180sqm living) and a two storey granny flat (70sqm living + garage at the bottom)?

Would subdividing the land to resell, in this case, be a good idea? We would then rent the granny flat or resell it in the future.

We were also thinking of building two 3-bedroom house but I feel like in older suburb people like bigger house hence why we were thinking the two options above as a granny flat would be easy to sell anyway and the bigger house would be on a comfortable land size (600sqm at least).

The reason we are going this option is that our budget kept getting exceeded at auctions and I calculated that we could build around the budget we set.

I build our two last house so I have pretty good experience working with builders.

 

If the granny flat was on it's own title then it's not really a granny flat but let's say a 1-2 bedroom townhouse/villa at the rear.

I love building so I will always vote to build if makes sense financially. You get exactly what you want and there are few compromises.

If you want a subdividable one then you need to make sure the zoning of the block allows it.

If you could find a block with the right zoning and size see if you can find one that is wide enough to do it side by side rather than front rear.

 

Do the research, see how the figures stack up against your investment strategy, growth and building wealth is all about having the foresight, and that is often going against the mainstream ideas

 

Yes we would be looking to do side-by-side even if it meant going two storey for both the granny flat (two-bedroom) and PPOR.

For the granny flat we would have to take an extra loan but we think it would be worth it as smaller property fetch usually a good price. Renting the place would bring extra income too.

 

If you want a big block of land - then doesn't subdividing it defeat the purpose ? You are just back to a small block of land again.

I'm a big fan of granny flats - great for income and also great for flexible living if family needs change.

 

600-700sqm is plenty for us. Most of the newer blocks we lived in were only 335sqm to 435sqm.
We would be looking to buy a 1000sqm block to do this.

 

Sounds good if the numbers stack up.

So is Canberra Hot, I believe one of the best economy performers in Australia at the moment.

MTR