Is it a good idea to do joint development?

Assuming this is a strata subdivision you should be able to entirely own one of the units once the project is finished and starta subdivision has taken place, however it will be the beginning of the project that matters.

One way I have seen this done by a builder that used to be my tenant was to establish a company and sell the shares of the company accordingly. Basically the company will own the entire project and then you will own 25% of shares and the other person owns the remaining 75% of shares. Therefore once the project is finished it can be revalued and if there is any selling taking place each shareholder will be remunerated according to the amount of shares they own. It should also enabled one shareholder to purchase from the other.

 

Would starting a company and distributing shares like this increase the cost significantly @Tenex ?

 

What about stamp duty and cgt?

 

" Unity you stand, divided you fall ". Since you are both friends, I would advise you both communicate openly as to what your goals are. Unfortunately, most joint ventures fail because of a money minded mentality. Personally, if I was in your shoes, I would be going for the joint venture with purposes of learning about the development process since you said you don't have a lot of experience in the field and discovering whether you would be comfortable to do future projects together if this one becomes a success. From there, you will be more confident of the joint venture.
In my experience, J.V's with friends is better than with strangers mostly for big projects. This is because you both have an internal obligation to do your best to ensure goal achievement and to enrich your friendship. This will be a growth experience for both of you. ALL THE BEST.

 

For stamp duty, I think its better to just split it equally but that would depend on the value of the townhouses.