Brisbane 2 homes development

Your partner - or developing?

I like the saying "You mess with the bull, you might get the horns".

 

touché

 

Hey mate what are you basing your final value off? Any particular homes sold you'll build something similar to?

 

Hi @Leo2413. Nice to see it's progressing well. Hope it won't get too much time to approve at council.

I'm still trying to understand the finance side of such a development. Do you know if the banks will consider the income from selling one when evaluating your serviceability for the next projects?

In my case I'm running numbers in my head and I'm not sure if I'll be able to hold one and still be in a position to borrow for the next projects. If that income is not taken into account I will need to sell both to move onto the next venture.

 

Is your town planner an accredited Risk Smart consultant?...maybe worth considering, as you can effectively alot of your time for reconfiguring 1 into 2 lot that comply Table 9.4.10.3.B of the Subdivision code, along with other flood, neighborhood overlays etc.

 

@Observer I doubt it mate, It's just a capital gain and not regular income unless you are earning a regular salary from your development business for over 12 months.But I would check with your finance broker.

 

Hi @ej89,

We're basing it off a few factors mate.

1. Direct comparable sales with and without city views (few in the area not that many)
2. Comparable sales in surrounding areas for both inferior and superior stock
3. Renovated comparable stock.

 

Hi @RetireRich101,

Depending on our DA and what design we can get approved if we can risksmart it we definitely will.

 

Hi Leo

I have also purchased an IP in Brisbane using company name as trustee for family trust i.e. ABC Pty Ltd as trustee for XYZ Trust. I am completing the transfer form. However, the conveyancer puts the name in transfer form as ABC Pty Ltd ACN xxxxx as trustee . The trust name does not appear in the transfer form.

In Victoria, it requires to lodge another form called “Notice of Trust Acquisition of an interest in land” to SRO office. What are the similar form in Queensland?

What do you put in the transferee name in the transfer form?

 

Sorry buddy I wouldn't have the foggiest. I just leave it up to the (trusted) accountants/solicitors and I sign where I need to.

 

Update: Prelodgement meeting went well and council engineers and town planners have in principle supported our subdivision plans. Next step is to engage an arborist to do a report on the trees we'll need to remove for the driveway. Round 1 is a win.

 

Hi Leo,

Congrats, love a place with views!

Whilst in DD stage and before settlement, you had your TP and architect consult with one another? Did you have them draw up concept plans to insure boundaries, setbacks, house sizes etc were all stacking up?

 

Thanks @Turbo_C. Yes I always like to get the consultants talking to each other so everyone is on the same page. Doesn't always work out perfectly but for the most part its been very helpful. We had a concept plan for the subdivision with a rough building envelope proposal but the focus was on the subdivision. As long as we can get that approved to what is acceptable for us, I'm sure we can make the homes work.

 

What's the end plan?

 

Subdivide, build, sell 1, revalue other and roll 80% equity/profits of both into more projects, 20% into a buffer for overall portfolio so if there is a GFC type event and banks require developers to lower lvr then I'm all prepared.

End plan is to always move us closer to our milestone goals.

 

Update:

Arborist report done and they concluded that the subject trees elected for retention can be successfully preserved within the context of the proposed driveway cross over design with the removal of two trees supported and rah-di rah rah they endorse the proposal. Survey completed and subdivision plan of lots designed. Town planner to lodge asap and fingers crossed BCC will smile on me.

 

Subdivision plan awaiting approval.

 

Have you now completed final survey Leo?
Can I ask what considerations you take into account before employing the survey team for pegging?

From what I understand they will charge every time they need to come back out on site, so such things as;
Insuring contractors that are installing new services have sent through any pegging requests
Insure any stormwater works that will require pegs/levels have been conveyed to the surveyors

Am I missing anything? Is this the general order you follow:
Design
Surveying
New services
Build

Cheers

 

Hi Turbo,

I have a relationship with a surveying company which do a good job. This is the initial survey needed for the subdivision plan. Pegging of the site will be done later and they don't charge me for it unless they need to specifically come back to the site more than 1 time.

With regards to the general order..this is roughly how I approach it:

1. Understand an area including demographics, in demand stock type, vacancy rates, resale values etc for development opportunities.
2. Have approx cost estimate for major costs for back of envelope feasibility when potential site is found.
3. Find site where BOE feaso shows roughly 25-30% margin,
4. Preliminary consultation with TP re site ( i never waste my time reading councils DCP etc i just want to know the very broad requirements eg lot size and frontage and zoning) and if a general YES is given by TP, then I negotiate the site , have a long enough DD clause for more detailed feasibility.
5. Once under DD and site is safe from being snatched away I engage a town planner to thoroughly assess and give recommendations. At this point depending on their feedback i may further consult with my engineers, builders, other consultants to get more information needed to asses the risk and viability of the deal and see where the numbers end up on a more detailed feaso with contingency.
6. If given the green light, accept deal. Start design process. Start subdivision. Get services in.
7. Start tendering process.
8. Build when ready.

 

Hey thanks for the detailed response mate, much appreciated. I can see where I went wrong with surveying now.

Your preliminary consultation with TP, is this just a quick phone call to confirm there are no glaring problems with what you have already envisioned for the site during your BOE calcs?