Hot Market..... you snooze, you loose

Discussion in 'The Buying & Selling Process' started by 380, 3rd Jul, 2015.

Join Australia's most dynamic and respected property investment community
Page 3 of 3
  1. MTR

    MTR Well-Known Member

    Joined:
    19th Jun, 2015
    Posts:
    27,859
    Location:
    My World
    Hehe, me three
     
    MTR, 9th Jul, 2015
    #41
    BigKahuna likes this.
  2. 380

    380 Well-Known Member

    Joined:
    19th Jun, 2015
    Posts:
    1,353
    Location:
    Australia
    Another one:

    Let’s call this “Day light Robbery In Western Sydney” , as our client picked up this deve on a sunny day at auction, and there is (circa) $500k profit in it!

    What:
    DA Approved site for 5 Townhouses

    Where
    Western Sydney

    WTF?
    Total cost(inc land,build,hold,Pro Fees) = $1,8M
    Resale value (5X$460k) = $2.3M

    Total Profit: $500k

    Project time line 12 months from next few weeks.

    Our client was aware of potential of site , work it required and profit margin, that allowed him/her to secure a site at well contested auction. Even though it is 5 dwelling, we are looking at possibility of getting a favorable funding under Resi loan.

    As we previously said, Anything decent with 4 and 5 in front of sale price, will have strong market for FHB and Investors.

    Moral of the story is : if you know what you are doing and have right team on board. You can still pick up a site in Sydney and make a decent coin!

    Re thread: let’s not derail it..if you have bought in recent hot market and you think, you have bought it well, please post here. .other members may get some benefits of knowing ins and outs deals and strategy!

    feel free to start a new thread if you want to discuss other topic. Sim doesn't charge money to start new thread!;)
     
    380, 24th Jul, 2015
    #42
    Biz, Catalyst, OC1 and 1 other person like this.
  3. Tekoz

    Tekoz Well-Known Member

    Joined:
    23rd Jun, 2015
    Posts:
    1,374
    Location:
    Sydney
    Tekoz, 24th Jul, 2015
    #43
  4. 380

    380 Well-Known Member

    Joined:
    19th Jun, 2015
    Posts:
    1,353
    Location:
    Australia
    @Tekoz

    IMO, this end product is in safe zone, as you said,median price is $1M.

    We are anticipating $460K per dwelling .

    as it is brand new, FHB are eligible to get a grant.
    For investors, Rent will cover the mortgage payments.
     
    380, 24th Jul, 2015
    #44
  5. OC1

    OC1 Well-Known Member

    Joined:
    6th Jul, 2015
    Posts:
    216
    Location:
    Melbourne
    Rents covering mortgage payments adds another layer of safety. Nice.
     
    OC1, 24th Jul, 2015
    #45
    Sackie, sanj and Tekoz like this.
  6. Tekoz

    Tekoz Well-Known Member

    Joined:
    23rd Jun, 2015
    Posts:
    1,374
    Location:
    Sydney
    @Be Developer: :p Ah yes,... you're right I was thinking the whole lot instead of the end subdivided product.

    Question, so after the end product has been fully erected & build, so how do you usually appoint Strata Manager or organizing Torrens Title ?
     
    Tekoz, 24th Jul, 2015
    #46
  7. 380

    380 Well-Known Member

    Joined:
    19th Jun, 2015
    Posts:
    1,353
    Location:
    Australia
    @Tekoz

    Re; strata management, I will respond to that question at later date.

    Re; Torrens title, title office will issue a title to each lot.
     
    380, 24th Jul, 2015
    #47
  8. Tekoz

    Tekoz Well-Known Member

    Joined:
    23rd Jun, 2015
    Posts:
    1,374
    Location:
    Sydney
    @Be Developer: Thanks mate, i'm just curious of how it is going ti be set. You do not have to be specific on, but how it is best to appoint it from a developers perspective.
     
    Tekoz, 24th Jul, 2015
    #48
  9. TMNT

    TMNT Well-Known Member

    Joined:
    23rd Jul, 2015
    Posts:
    5,572
    Location:
    Melbourne
    did you include GST components for the resale value?

    Your profit margins are still good but more down to earth once you take GST into account
     
    TMNT, 24th Jul, 2015
    #49
  10. 380

    380 Well-Known Member

    Joined:
    19th Jun, 2015
    Posts:
    1,353
    Location:
    Australia
    @TMNT

    No tax $$$$ are accounted for! There will be fair bit of GST on this deal.

    But it will really depends on clients individual situation.

    Also, sale price has been calculated on comaprable recent sale of end product in area.
     
    380, 24th Jul, 2015
    #50
  11. TMNT

    TMNT Well-Known Member

    Joined:
    23rd Jul, 2015
    Posts:
    5,572
    Location:
    Melbourne
    true....... gst is different for everyone, however im pretty sure that gst on sales will apply for pretty much most people!
    at full gst consideration the profit drops down to 1.5m

    still not too bad though ;)
     
    TMNT, 24th Jul, 2015
    #51
  12. OC1

    OC1 Well-Known Member

    Joined:
    6th Jul, 2015
    Posts:
    216
    Location:
    Melbourne
    No it doesn't. Margin scheme.
     
    OC1, 24th Jul, 2015
    #52
    380 likes this.
  13. TMNT

    TMNT Well-Known Member

    Joined:
    23rd Jul, 2015
    Posts:
    5,572
    Location:
    Melbourne
    Not if your not selling or sell one years later
     
    TMNT, 24th Jul, 2015
    #53
  14. OC1

    OC1 Well-Known Member

    Joined:
    6th Jul, 2015
    Posts:
    216
    Location:
    Melbourne
    I'm referring to your $1.5m figure. GST is less than you think if you utilise the margin scheme.
     
    OC1, 24th Jul, 2015
    #54
  15. 380

    380 Well-Known Member

    Joined:
    19th Jun, 2015
    Posts:
    1,353
    Location:
    Australia
    Witnessing Sydney Auctions :

    Is market slowing down??

    On ground report: No

    Reported clearance rate: may be going down as more listing on market
    but
    Reported median price is going up.


    @MsAli posted a photo of western Sydney auction last week and still plenty buyers out there.

    As we are approaching Spring... more stock coming on a market.

    Few good development sites (outside of box deals)
    Church
    medical centers
    House/shop combo
    demo/rebuild


    interesting time ahead!
     
    380, 29th Aug, 2015
    #55
  16. RetireRich101

    RetireRich101 Well-Known Member

    Joined:
    18th Jun, 2015
    Posts:
    2,149
    Location:
    Sydney
    Sounds like a deal somehwere in Penrith council under R3 zoning
     
    RetireRich101, 29th Aug, 2015
    #56
  17. Kashmir

    Kashmir Well-Known Member

    Joined:
    5th Aug, 2015
    Posts:
    78
    Location:
    Sydney, NSW
    If a property is R3 zoned (currently a standalone house) in a great area..should the sales agent be specifying this?
     
    Kashmir, 31st Aug, 2015
    #57
  18. 380

    380 Well-Known Member

    Joined:
    19th Jun, 2015
    Posts:
    1,353
    Location:
    Australia
    Few of them in Central coast area....Affordable range (Sub $600K)

    Most REA will do that or check sec149 on contract!
     
    380, 31st Aug, 2015
    #58
    Tekoz likes this.
  19. OC1

    OC1 Well-Known Member

    Joined:
    6th Jul, 2015
    Posts:
    216
    Location:
    Melbourne
    Looks like next door only managed to get a permit for 3 units after receiving over 10 objections. They too paid $520k. Seems like market value to me.
     
    OC1, 8th Jan, 2016
    #59
  20. MTR

    MTR Well-Known Member

    Joined:
    19th Jun, 2015
    Posts:
    27,859
    Location:
    My World
    my adjoining property zoning is higher density than neighbour's property

    If I get 3 or 4 is not an issue, I paid peanuts for the block

    Marisa
     
    Last edited by a moderator: 13th Jan, 2016
    MTR, 8th Jan, 2016
    #60
    Rixter, SOULFLY3 and Xenia like this.
Page 3 of 3