Is it worth demolishing and building two new houses?

Discussion in 'Investment Strategy' started by David Thiu, 7th Nov, 2017.

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  1. David Thiu

    David Thiu Well-Known Member

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    Hey guys,

    Just doing a bit of research on the Salisbury North area and stumbled onto this property:

    Click here to see

    From a numbers perspective, does demolishing the house and building two new ones stack up?

    It seems this is what has been done for the house behind that, and I saw one property with frontage of 8m in the area.

    Whats the price range you are looking at for demolishing, subdividing, and then building on this site?
     
  2. Westminster

    Westminster Tigress at Tiger Developments Business Member

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    Only you can know if it's feasible as your idea of feasible may be different to anyone else's

    If you know none of the answers to your question then I would say that you are not ready to purchase this type of property.

    You can find information that may assist you in this forum then try and work out a feaso and put it up here for some assistance/feedback but don't ask the forum to do all the work for you
     
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  3. David Thiu

    David Thiu Well-Known Member

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    Fair enough... Just wanted a ball park figure and see whether it is worthwhile to go into more indepth analysis later on with these type of deals...
     
  4. Westminster

    Westminster Tigress at Tiger Developments Business Member

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    @D.T. did a side by side duplex in the area and wrote a thread on it with numbers. They might be a little out of date as it was 2016 (I think) but should help with ballpark figures
     
  5. D.T.

    D.T. Specialist Property Manager Business Member

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    Estimated buy price on your screen shot was $242K ?
    Work on about $25K to subdivide
    And about $165K each dwelling
    Equals about $597K

    So, then you can work out your own feasibility, depending on whether you want to sell or lease on completion, as to whether $597K is worthwhile for you.

    Edit - Sorry forgot, you probably want to allow about $15K for demolishing existing house and disposing of the junk. My one was on a vacant block so I didnt need this step.
     
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  6. mickyyyy

    mickyyyy Well-Known Member

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    165k to build a free standing house? how many internal sqms meters and bed, bathroom, garage are you talking about for that price?
     
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  7. D.T.

    D.T. Specialist Property Manager Business Member

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    Yea that's what my ones were. 3 bed , 2 bath, 2 living area, single garage, higher ceilings. Build contract was about 150 then extra for doing afterwards stuff like aircond, landscaping etc
     
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  8. mickyyyy

    mickyyyy Well-Known Member

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    What state and builders name? How many internal sqm was it?
     
  9. D.T.

    D.T. Specialist Property Manager Business Member

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    In Adelaide with Statesman, don't remember the Sqm. I wrote a live journal thread on here Developing in Adelaide if its of any interest.
     
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  10. David Thiu

    David Thiu Well-Known Member

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    @D.T. Thanks for sharing. I like the part where you acted cool, when the RevenueSA lady got back in touch with asking for $100k

    "More weeks went by and they came back to say they were allowed to sell it, at a price of $100k and asked if u want to proceed to which I said sure. (Under my breath : hells yea I do!)"
     
  11. Depreciator

    Depreciator Well-Known Member

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    That house that sold around the corner from me in Marrickville on the weekend for $2.52m will have two dwellings put on it for sure. It's a lot of money for a site. They're going to have to put decent houses on it, too, given the expectations of buyers in the area.
     

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