WA Development Opportunity in Perth

Just wanted to see people's thoughts on this property, currently selling it in a slow market and would like to know what to do in order for it to sell quicker. It's located in Girrawheen, about 15km's from Perth city (10 minutes) and it's a straight forward development (i.e. flat block, huge build & retain space, over 3 metre side access). I'd keep if I didn't have to buy a PPOR, but I personally thought it was a good opportunity when I purchased it...well for the long term.

DEVELOPERS INFORMATION:
The large 693sqm property sits on the centre front of the block (Zoned R20/R40), allowing the opportunity to retain the house and build a house, unit, or granny flat at the back. The property has over 3 metre side access, making it a hassle free development. The possible development strategies (subject to individual shire approval) for this property are listed below:

- Demolish, sub-divide the block and build up to 2 or 3 units
- Retain the front house & build a house or unit at the back
- Demolish, sub-divide the block into 2 or 3 lots and sell the vacant land

PROPERTY FEATURES:
- Single door entry with security door
- 3 bedrooms
- 1 bathroom
- New kitchen stove
- Renovated bathroom
- New carpets in all bedrooms
- Freshly painted
- Massive patio
- Sits on a large 693 sqm block

LINK BELOW:
44 Morgan Way Girrawheen WA 6064 - House for Sale #125392878 - realestate.com.au

 

I've found if property is presented well, advertised well and hasn't sold... only thing left is price.

 

The problem is the seller paid $380,000 for this property in Sep 2013. Sale price now is $380,000. This is not a good situation for the seller but it is common in Perth now. It is very tough for those selling properties bought in 2013-15

44 Morgan Way, Girrawheen, WA 6064 - View Sold History & Research Property Values - realestate.com.au

 

I would personally not develop in this area/suburb even though I have purchased and sold in 2013/14 boom, purely because I don't like the end values. Its always going to be harder to make it stack up and I can only work on values today

 

The issue is clearly price.

I've said it before to you in previous threads that there are comparable properties for sale with asking prices in the low 300s and mid 300s. I think you even acknowledged this was the case too.

I know you said you really needed to sell it for more than that - but that doesn't affect what buyers are willing to pay for it.

The development value of the property is nothing special compared to most other properties in the area, so I don't think there's any point in trying to overly highlight that either.

 

I know, its a hard pill to swallow. I've kept it at this price because I would like to break even, and secondly i've seen other properties similar to mine sell at this price recently on rpdata. Realistically speaking, what would you price this as? Because I may have to accept a loss anyway

 

If you have the time, I would definitely go to view some of the comparable houses for sale in the area, so you can get on the ground information about how they compare, how much interest there is, and what prices they are selling for.

Even I haven't been on the ground in Girrawheen for a while, but just my online trawling seems to suggest mid 300s at least, because similar looking properties are not selling at that listing price. If you need a quick sale, then even low 300s.

 

Hi Martinez

I did not realise this was your property, sorry I missed that.

What are these guys achieving at the moment with similar properties?
They were getting best prices in the area when I was buying/selling.
Ray White Whiteman & Associates

Also, my understanding is West Girrawheen closer to Wanneroo Road is far more desirable and tend to get higher prices.

 

What is your agent saying? Or what are you paying him for (or not)....or is he afraid to be honest with you as he thinks it's 'breakeven'or nothing?

 

$9,500 fixed, agent is a family friend of mine..he is pretty honest with me regarding the reality of girrawheen prices. He recommended that I hold until the market recovers a bit so I don't sell at such a huge loss.

 

That could be 5 years easily.

 

What would you do?

 

:OOOOOO

 

If it's holding up a family home Ppor it's obvious ain't it? Would you buy it for 340 now in hope it goes up to 380? That's what you're essentially doing now by sitting on it. Yes I realise it's not so straightforward in practice.

 

Recovery could be 5 years but there is also a decent argument that it could be next year. I think in any case, the point is that there is little downside left in Perth so the worry of off-loading to avoid further losses is very minimal.

Ask yourself what you would be doing with your equity if you released it from this property. doing that will cost you $10k, plus stamp duty if you buy again. if you don't have a plan for your money elsewhere which makes more than the cost of stamp duty and agent fees, you aren't getting any benefit from selling now.

Dont dwell on what it has lost you, that's already happened. look to what is the best use of your equity right now. if that means taking a loss to put your money to work elsewhere, get on with it. if you're selling because you're just scared of the perth market and don't actually have a plan, odds are you're only going to keep loosing money.