TAS Block of land with abandoned home

Hi all,

I've been looking at buying a block of land as an investment in a regional town where property prices are extremely cheap, but where prices have been rising recently, and the market has been becoming much more active. (I've been following the property market there for a couple of years).

I've come across one particular property which is an abandoned house sitting on a very large block (2,000m2) very close to the town centre. The interior of the home (probably once 2 or 3 bedroom) is completely gutted, but has had some basic maintenance to effectively be a structurally sound empty shell.

The property is listed for $50k, which I would consider a fair price for the land alone given recent sales of vacant blocks nearby. If I had the time and money I would probably be interested in renovating the home on the block - but that likely wouldn't happen for a few years at least.

What would some of the considerations, extra costs or disadvantages be for buying a block of land like this and essentially doing nothing with the structure in the short term? Obviously there would be the cost of maintaining the structure itself if I want to improve it in future. But on the flip side is there anything preventing me from letting it fall into disrepair, if we assume that it currently isn't contributing much to the property value?

Cheers

 

First off is insurance, lack of occupancy would mean it would be difficult to obtain building insurance, so you would likely still need public liability insurance for protection from trespassing.

Other holding costs, rates, water, grounds maintenance, fencing.

Then should you finally renovate, are you prepared to travel there and back many many times.......

There's probably a very good reason it's cheap

 

My concern is that a property that will cost $50k on 2000m2 land near the town centre will never really be worth anything much.

You also need to consider insurance. Many won't insure a property that is vacant.

 

Is it in the NE or the west coast? As others have said it unlikely to stack up given holding costs etc. You need to get it producing income asap, or flipped. The only route to success would be to immediately get a caravan on site and fix it up yourself. It won't work out unless you have the renovation skills to do it all except elec and plumbing and even those can have their costs reduced with appropriate application of your labour.

 

How remote is the town that this property is a part of? Think about all the additional costs to build anything - new or renovation - a long way from a major city.