Hi all I bought my first IP Feb last yr in Pascoe Vale South which is a 2bed 1bath 1car villa unit and it is 1 unit of 3. I have recently received notice that sadly my elderly neighbour who was in poor health has passed away. While this news is sad I couldn't help but wonder about what my future opportunities would be if i were to purchase this property. Having spoken to the remaining neighbour he said that the property was being passed down to the son but was unsure what they would do with it. I have enough capital at my disposal to make an attractive offer and if a direct purchase could be negotiated the avoidance of agent fees would be a win win for both buyer and seller. I was wondering what questions I need to ask in order to deduce whether purchasing this adjacent property is worth it for me to develop it down the track. The 3 units are strata titled. So far I have got: Would the remaining neighbour sell? How does this strata titled land affect the development process? How many properties could be put on the whole parcel of land and would their completed value justify the purchasing price? Does the council encourage new developments? Does the zoning encourage new developments? Would renovating a 2nd property make it cheaper to renovate the first? Any answers and help on what other questions I should be asking would be greatly appreciated!
1. Ask the neighbour but the will is going to take a while to process and you will need to be sensitive that this person is grieving. 2. Yes. 3. Who knows? But it's unlikely you will get more than the current three. Ask the council planning department. 4. Maybe. Ask the council. 5. Yep. 6. Nope.
Depends how "inefficiently" the land was used in the present development. It is likely that down the track the 2BR could for instance be replaced with a 2 level 3 br (STCA). The Y-man
Thanks for the responses so far. Re Question 2 hobartchic you said yes. Could you please elaborate how strata titled land would be treated differently?
As there's still another owner with rights over the common property, you have a lot of limitations with the footprint you design on developing the combined units. As others have said, you won't get more than two new dwellings on the parcel and the best you could hope for is larger (double story) dwellings. If you want to buy the neighbouring unit as an investment, best to think of it as a buy and hold strategy and added benefit of being able to choose your neighbour (tenant). If you were to buy the third unit eventually, well that's a different story...
As I saw someone put it so eloquently in a different thread, I'd only buy a neighbour's property if basically 1+1=3 or more. Buying a neighbouring strata lot seems more like 1+1=1.75
A short consult with a local town planner and real estate agent may answer most of your questions. Even a matter like finance could be a deal breaker.
