Building in new estates in Sydney.

Hi everyone,

I am interested in building a home in a new estate in Western Sydney around mid next year.

Just wondering if anyone has done this within the last year or is currently doing this. Is there money to be made by doing it?

Would the best strategy be to buy land, build them sell and then use the profit to do the same thing again or would it be better to buy land, build and rent it out and access the equity to repeat the cycle.

Regards
Brian

 

Isn't Sydney a bit 'hot' atm? This would increase risk enormously.

 

I reckon that ship has sailed to simply buy, build and flip.

Buy and hold I wouldn't be keen on either, those new building will depreciate a lot and you need to allow 5-10 years for the land value itself to increase to absorb the developers margin.

 

I would not touch it unless.....

1 you are prepared to hold or live in if market turn sharply
2 you can get a cheaper block due to contacts and much cheaper build (which I assume you could)
3 probably your not as busy with good paying jobs

Ideal time to do this would be when the market is flat and has been for a number of years IMO.

 

There are blocks selling for around $400k and I will build myself once I get my licence for approx $200k for a single storey making it $600k completed and they are selling for around $700k+

I understand there are further costs like cgt and selling fees etc but it still leaves room for profit.

 

In regards to number 3- I can have my boys still doing the framing on my other jobs that provide my income while I run this new build. Plus I wouldn't have to be on that site all day. Maybe check on the job in the mornings and arvos to make sure the job is progressing and running on schedule.

I can't really see it slowing down in the area I am looking to build in. They are building so many new facilities there providing more jobs and growth for the area.

I haven't really inquired about the land yet but may be able to speak to some people.

 

You'd make minimum 20% CG by saving on your building margin. Those on the ground know there's still some money to be made by building and selling. Still remember one of the more popular guru's on somersoft/propertychat last yr saying land was too expensive and not to buy it so he invested in Brisbane... Missed out on a 150k of land values jumping up.. If you know a market, do it

 

Yeah, sometimes if you know something and the risk is acceptable and eyes open, just go for it, everyone was saying stay away from the SW a while back, anyone who bought in the places we talked about is up over 20%

 

Not really. Stamps, holding and approval costs, don't forget gst on sale too. You'd end up working for free just to make a tiny profit imo

 

still possible in Officer,VIC , Clyde,VIC or even Pakenham,VIC if you buy in stage 1/2 that is....developer adds roughly 7k per stage ..so thats artificial growth per stage and most estates have avg 4-5 stages...Someone here did it...Sash?

 

If you live in it for a year, then sell, you might be able to get away with some costs, right?