NSW Newcastle 2018

Only an hour on the train too!

 

The property next door will be for sale soon, also 1000m2 with a DA approved for small duplex out the back.. poorly planned.

 

Anyone know where 2 Johnson St, Lambton ended up? We left at $451k when the bidding between fhb's was in full swing at tiny increments - we were looking for a development block and, after doing all the sums, couldn't justify going over $400k.

Fire damaged and semi-gutted asbestos clad dept housing house - in dept housing area, but still good location - so looking at land value (less demo) value only ... and the punters blame the investors for driving up the prices pffffft

2 Johnson Street Lambton NSW 2299 - House for Sale #128635162 - realestate.com.au

 

Hi Lizzie,

That sold for $463,000, that would be the cheapest land sale in Lambton for a long time.

 

It sold then for around what the agent quoted ... the numbers just didn't make sense for us then building a 3.2.1 duplex when looking at sale prices and rents for similar in recent month.

Also, no guarantee of approval for a duplex, being R2, despite precedence set over the road and behind ... got caught with the "precedence" issue before

 

Wouldnt even of bothered showing up if your limit was 400k wasted a beautiful saturday.

 

Sold 730k very top of the guide just like i said

 

good luck to them. I think I will find something else to put my money into.

 

Ya know what. I take that back. There is a dual occ for sale at 5 regent st for 1.1 mil.. maybe that place wasn't so bad for 730k

 

That duplex has been on the market for quite a while at $1.1m.

Developer might have over capitalised on that one. Buyers have plenty of options for that price range.

 

I just had a look on rpdata the sale was registered 3 days ago for 1.1m, they have done well getting that price for a duplex. It did take 57 days though which is well above the 30 day average in New Lambton.

 

Market update-

Quality renovations and new builds are still selling well as long as they are priced right.

Unrenovated homes which 12 months ago buyers were paying a premium for are struggling to sell. It doesn’t seem like many buyers are out looking at the moment that want to put the work in. Lots of first homes buyers wanting nicely renovated homes up to $650,000.

My strategy over the next 12 months for the Newcastle market is going to shift from buy and hold to buy and flip.

I’m going to target homes like the one below, if you could buy it for low $500’s spend 50k to 60k including holding costs and the renovation.
It will be worth close to $650,000 in the current market. Not huge profits but a couple of these are year will be fairly easy money.
12 Roe Street Mayfield NSW 2304 - House for Sale #128852310 - realestate.com.au

This one sold for $625,000.
85 Fawcett Street, Mayfield, NSW 2304 - Property Details

 

3 month flip in Maryville.

10 Downie St Maryville, sold for $585,000.

10 Downie Street, Maryville, NSW 2293 - Property Details

Just listed for $700,000 to $770,000
10 Downie Street Maryville NSW 2293 - House for Sale #128868870 - realestate.com.au

 

That's why we didn't want to pay more than mid-400's for a potential (ie, can be knocked back by council) duplex block ... by the time you pay all costs and build the darn thing ...

 

Stamp duty and CGT are the killer on these tight margins ... luckily you can avoid selling agents fees ... unless it's a ppor but have to be careful you don't do it to often in a short period or the ATO starts to look askew

 

Waa going to mention that Lizzie. Pays to speak to a good accountant before taking on this strategy, normally developers would not take on a project with less than 20% net profit margin as there is next to no margin for error.

Very tight margins on "gross" profit on those quick flip examples. After you account for CGT taxes, stamp duty and agent fee - youre left with not much in terms of profit for quite a bit hard yakka and risk.

Unless you treat it as your PPOR you don't have to worry about CGT. But if you're doing a few flips a year then the ATO will judge that you're a professional in the business of carrying out renovations with an intent to sell. Then your gains are taxed as income rather than capital gains.

 

Plus one must ask themselves how much they value their own "time"

 

hmmmm, not sure about the analysis on this one:
What Hunter suburbs are making landlords the most money?

what do they mean by quarter on quarter and year on year in this context?

Cheers,
Inertia.

 

My parents are selling their home and had a poor valuation on it - valuers advised they have been told to reduce vals by 15% from actual to build in a buffer for an expected market correction

 

Profit seems tight but the break down looks like this, just let me know if i have missed anything.
Luckily I have a trade background and can sell it myself otherwise it wouldn't stack up.

Purchase price + $500,000

Purchasing costs/ Stamp duty + $20,000

Renovation- Paint, flooring, bathroom,kitchen + $40,000.

Total cost= $560,000

Sell for $650,000

CGT -$30,000

Holding costs for 3 months -$5000

Marketing costs -$3000

Legal fees -$2000

If it sells for $650,000 - $40,000 in costs = $610,000 - Total spend $560,000.

Profit = $50,000