New vs Old - What do you think?

Did you ask me any of these questions directly?
I would of answered them.

No insider knowledge is required to buy a vacant block of land and then pay a builder to build a house on it. It is no big secret how to do this. @sash wrote a topic on it and I contributed, hardly a big secret. But if you have questions about how to do it why don't you start a new topic and ask for help. Given your friendly nature I'm sure people will be falling over themselves to assist you.

It is also no big secret that if you buy this product from your Financial Planner or Accountant your paying over the odds for convenience factor.

Again I ask you what insider knowledge do I have here? I think your confusing insider knowledge with knowledge and experience.

Do @Leo2413 and @MTR have insider knowledge to make money from property development or do they have learnt knowledge and experience?

I never said I have no backup to a downturn. I have a strong manufactured equity position and low starting LVR of 20%. On completion I will have a 35-45% LVR unless I refinance. So again you just make stuff up.

This was not a topic on were to buy. But in any case were is less important than when. Buying in earlier stages can be helpful but not the only way to make money. Buying at the start of an upswing in a market is probably the most important thing alongside not over capitalising by targeting the right size building on a small lot.

Again this is not insider knowledge. It's the same with all property. Buy in an upswing. Hang on same with shares as well. OMG I must be warren buffet. Come on mate this is a forum of like minded individuals I would expect some commonsense if you don't know ask but don't assume I know your incompetence.

Since when have I disagreed or been asked by @MTR when to buy? (If I was I'm sorry I didn't answer you @MTR - sometimes I miss posts and just scan)
In any case my answer would be as per above. That said I'd probably have to ask her if she was trolling As she clearly knows the answer to this question better than me based on her posts.

You have obviously taken an unhealthy interest in the content of my posts. accusing someone of insider trading with absolutely no evidence of it is slander. Please stop slandering me on a public forum. if you have any questions you wish to ask me fine but try and ask them in a positive light.

 

One hour of my life I will never get back. Thanks @Skilled_Migrant

 

Hey shoosh! Your gonna get the authorities onto @MTR and myself!

@Cactus not everyone here wants to build wealth. I wouldn't waste your time on them for a second more mate.

 

Missed this post.

Who said I was buying product I am selling? That's a breach of section 55 mate.


Who said i was buying stock that i had given to project marketers? I said buy vacant land from developer directly and engage builder.

I have engaged a project marketer on some units I am developing. I am not keeping any of them.

Again nothing new here. Just make up your own facts and slander me.

 

Good point @Leo2413, I don't like leaving posts with accusations like that unanswered as it can appear an admission of guilt. But it would appear instead I am just bashing my head up against a brick wall. Maybe the ignore button would be appropriate.

 

Sorry @Chris White for completely derailing your thread. My post was meant to offer a different opinion to yours but not intended to develop into a discussion on the structure of development their capital raising methods and insider trading.

 

I appreciate your opinions and personal experience. I think this forum works best when people can openly share their views and everyone can learn, agree or disagree.

In the context of my example I believe that my points are correct. I think that in the context of your example that your points are also correct.

My beef is really when naive mum and dad investors are stitched up by property promoters / spruikers who promise the world and frankly, undeliver to say the least.

I regularly get asked by multi-tier property promoters would I push their products to my clients. Most of these promoters are just salesman, they have no idea about the fundamentals of property - I often ask them questions and they have no idea.

So in the context of my post, this investor paid too much for a substandard block in an area that is being flooded with properties and they could of bought something cheaper and better a couple of hundred metres away that is only a few years old (not that they should be buying in this area at all).

If I understand correctly, you purchased a block in an area that is tighter in supply for a good price (i.e got in early before the price escalation of the blocks).

Well done on that. However, you must agree that many purchasers of H & L would not know most of the fundamentals that influence capital growth so are really speculating and hoping that the market will be kind to them.

 

I agree with your comments here. I have openly admitted to selling through these promoters before, because they can get a better price for the developer. I would never buy through them myself. I would as previously stated only buy the vacant land and then contract a build. Any one can do this but it takes a lot of time to find the best combination of land and build to manufacture good equity. I would suggest that it also takes a lot of time to research the best established acquisition.

So some people pay a BA for established, some BA's get the client a better deal and therefore the BA fee is negligible. I would consider using a BA for interstate acquisition.

Some project marketers get a discount on the land commensurate with their commissions due to the developer wanting to de-risk and get some sales up quickly. Therefore their fee is negligible.

There a good BA and bad BA, there are good project marketers and bad project marketers. Again I would not buy through a Project Marketer because I have the experience and time to do my own research and negotiate a better deal. But for people that are time poor and want lower entry price resi investment, they can be an ok route to ownership in a rising market. They are less likely to be a good route to ownership in a peaked market.

 

I have no wish to defame anyone especially when I do not know the person, all that is happening here is that your POV is being challenged, I would characterize it as DD .

There were some parts of the H&L strategy recommended by you that were not adding up, till you inadvertently fessed up on your nexus with the estate developers and consequent insider knowledge (supply control ?), which made everything stack up (especially transfer of marketing price to your profits i.e. 10-15% reduction in your acquisition price). This knowledge is not available to all the investors, which makes the strategy financially dubious, even if we ignore the legitimacy of it.

I am not the only one (OP being another) with apprehensions (marketing plug and insider knowledge) about your version of H&L, just that I have forthrightly questioned it.

Unlike you, the posters mentioned have never claimed insider knowledge of the estate developers wrt acquisition, sales or shown any inkling of having used this knowledge. As a matter of fact @MTR has expressed her aversion to H&L packages based on her experiences and warned others of the consequences in downturn.

Participation is voluntary, by all means ignore the inconvenient posts. IMHO it is worthwhile challenging POVs to have a better understanding. Your posts have vindicated my (and hopefully others) skepticism and have been educative on how the decks (risk/reward) are stacked against the normally informed investors (by rezoning syndicates, estate developers, spruikers, front-runners, builders ), and the exceptional timing required in H&L packages.

 

a case in point. my friend was researching to buy H + L in Victoria, through a promoter and the developer. There's a difference of at least $30K. He opted to buy land and then build. It was said that the promoter/marketer would be the go between and ensure builder gets things done on time and properly. That's like $30K for them to do a job that my friend, albeit from Sydney. That's a nice earning.

 

yes I am @RetireRich101 thanks for the support and some new information regarding this suburb . I believe it is only a matter of time before this suburb has become another booming suburb or in the Terry Rider hotspot.

just like Austral in NSW, this suburb was once similar like Park Ridge, but now it was featured in the Top suburb lists.

 

That is correct. With H&L the margins are always there if you do the land separately from the build, you save on the build costs but you do the organizing and running around. I've done H&L builds this way before. You can even go one step further by doing the landscaping and flooring and certain upgrades yourself. Depending on your build price -There is a margin of 30-50K. Bear in mind, unless you are the @sash it best to be local within the state to do these kind of things.

 

Surely not without some form of insider trading going on. Are you or have you ever worked for a developer? Do you run a project marketing office? How did you gain this knowledge? It's not possible you must be lying. @Skilled_Migrant

 

loving how everyone goes off topic, including myself.
what was the question again Chris?

 

DD does not include making accusations of impropriety and insider trading.

What part doesn't add up? I am not the only person on this forum who agrees that money can be made from H&L without any form of hocus pocus going on... Project Marketers are packaging lots on most estates in growth areas for Builders and Developers.

I do not know which ones they are and which ones they aren't. I am no more advantaged or disadvantaged than any other investor who walks into a sales office and asks for some information on pricing and titles date. Anyone who does this is a "front runner" then. I have not received any discount on my purchases on the list price the sales agent gave me. I have found Builders to be more negotiable than Developers.

Do I have an understanding on PSPs and where there is future supply and how long off the services are? Yes. Is this publicly available information? Yes

Therefore I still find your comments of insider knowledge and allegations of dubiousnes Unfair, Unfounded and Offensive.

No you have attacked every one of my posts with the sole intent of trying to make me out as being dubious. What is your motive here? Why can't you take my experiences and information on board? Why when someone says they have worked in the industry do you not think maybe they have something to add to the conversation. Why is it when another investor says the exact same thing that they have made money from H&L do you not question them to the same degree you have questioned me under the guise of DD.

Now your misquoting me, because I'm pretty sure I have also never claimed insider knowledge I have claimed experience with estate developers in acquisitions, sales and delivery. @MTR may have had mixed experiences with H&L but she has also stated she was doing 4 per year, and that she was supportive of it as a strategy in a rising market.

For the record, I am not and have never advocated that H&L is the only way to build a succesful property portfolio. I simply posted in this topic to share a differing opinion to the OP. And as I keep saying I would not (nor do I expect anyone else would on this forum) buy through a property spruiker/marketer. I continually suggest that people buy the house and land separately and put the two together to manufacture some equity. This strategy is not reliant on other people paying over the odds through a spruiker (though of course this could help valuations). In a rising market (currently occurring in Melbourne) the developers put the price up each stage, further the builders put the prices up every 3-6 months, these two items help add equity based on replacement costs.

But rather than continually go back and forth on this, lets agree to disagree, you dislike H&L and anyone that has profited from them, and I see it as one of many strategies to wealth creation. Hell we can add it to the other topics we disagree on like taxation. I wont put you on ignore (not that I expect you to care) because occasionally I find your posts informative albeit long winded (haha like this one).

 

Yes an independent building surveyor will do the same job for $1-2K...

Edit: and is actually qualified to do.

 

I do not dislike H&L, but agree to disagree.

 

Would you recommend one or two?

 

haha Nope a standard investor just trying to make a gain

 

i thought a building surveyor is the one that issues the permit upon doing the inspections etc. not Project manage the build. IF the promoter is the go btw i hope he is a building inspector or lawyer as really manage it based on these terms. To ensure the build goes smoothly all depends on your buildling contract and also the inspections, rectifications etc.