Building Costs Melbourne - for investment

Howdy,

I'm considering building a house in VIC for an investment, and trying to work out if it could actually be somewhat profitable to build, given the right location etc. and then hold for 1 year after completion then sell, to minimise CGT.

What are all the hidden costs in building a house, if anyone can?

This is what I am thinking:

Land cost: 400K approx
Build 4 Bed 2 bath, 2 car house: 230K approx. (inclusions TBC. Not sure if driveway included.)
Landscaping: 10K?
Incidentals/Extras: 20K+?
Bank interest on above costs over 1 year: $16,500 approx
Total: $676,500 very ball park cost.

(Land I've seen for sale in VIC eastern suburbs of Melbourne - some good options, not mentioning the exact location yet but looking at suburbs about 15 minutes out past Ringwood and Croydon, i.e. a lot cheaper than Ringwood.)

Houses in this street where I found land are selling for 800-900K+, (so 800K+ for an old 3 bed house. Even a townhouse in this street is worth 860K.)

So seems there is room for profit, but I know building costs can get blown out.

Anyone care to share insight into building single dwelling houses for equity and profit?

 

230K const costs for mid range/mid quality seems a little low
Add in professional fees. Floor coverings (?) curtains and blinds

 

It probably has some exclusions.
What professional fees were you thinking? Like conveyancer, surveyor etc.?

 

Back to 2013. My building cost for a 160 sqm townhouse is $320,000. Your estimated cost is too low but depending on builders, quality, and how many townhouses you build at the same time.

 

If it is now a new subdivision....and even if it was you are now looking around 270-300k for a new house Turnkey minimum( 22sq 4brm home). If is a knock down rebuild depending on your land ..but assuming it is straight forward you would be looking at 350k plus minimum...includes knock down costs and re-establising all new services.

 

That was expensive, I built 2, 220 sqm houses for 350k. One cost 150k, contract signed before first home owners grant, the other 200k after grant introduction.

 

Do you mean 222 sqm?

 

With land costs circa 400k I’m assuming your talking about new estates, but then you go on to say old 3 bedders are selling for 800k.
If in an established street/neighborhood I think your numbers are on the low side, if in a new estate costs possibly on the money but why would someone buy your one year old home for ~120k more than they could build their own new home?
Cheers

 

Need to think about GST and profit from isolated transactions which means you might not get the CGT discount. Seek proper tax advice.

 

cost is only $1500m2? turnkey i thought it was more 1800-2000m2?

 

Remember I am talking about fresh land with a reputable dveloper. So based on a price of $280k....and a 210sqm home (includes garage...alfresco). So about 1335/sqm.

1800-2000/sqm....is nuts that should be a ultra luxury build. I am talking about project builders here for the stuff I do.

For example in Perth....even now it will cost about $1300/sqm for a decent spec. A lower spec home will be about $1150/sqm

 

i'm surprised the 1500m2 is off your higher price quote of 350k what you think it'd cost for 3 townhouse development in melbourne mid spec per m2 atm?

 

T/H is different product to a stock standard H&L in a new estate.

Yes you could build a basic one about 19-20 sq for that kind of money. Higher cost because site costs and double storey costs more. The one I referred to are single storey.