Since I saw couple of posts regarding profiting from off the plan land, I am wondering how much capital gain can be achieved, Especially when many “property analysts” do not recommend buying in a new / growing area Please share your gain / loss from off the plan land, both the land itself or with the house built. I bought off the plan land in the established suburbs in melbourne: 1. 2nd last stage in inner west. Bought for $675k. 3 months after, they released the same size of block on the same street for $730k. Purchased in 2014, settled in 2016. Current estimate price - (land+Build) = $425k 2. 1st stage in mid eastern suburb. Bought for $550k. Same size of block in the same estate then sold for $950k, a year after. I am now interested in the new/growing area, but not sure how much return and investment is. Please share
that was then this is now different parts of the cycle Still money to be made Im sure, BUT the risk is much much larger today ta rolf
I had a client who tripped his money before settlement. Well tripled in value at one point but values dropped by time of settlement. He ended up bankrupt
I agree, risk is high. I am interested to know how much gain /loss for greenfield land under $300k Terryw, is it in metro area?
A couple I know bought 18 months ago OTP townhouse in Pakenham (Vic). They put down deposit and sold it at handover a few months ago at 100k net profit They didn't intend to flip but couldn't resist the quick money. This was a development with 50+ other near identical properties. They did sell as soon as it settled though so perhaps beat the competitors to the market.
A rising tide lifts all boats.. If you can hit at right time of the cycle, money surely to be made. In current market (esp. in Vic and NSW), I won't bother at all ..
I have to say when my friends were talking to me about it it did tempt me. I have 3 IPs and have never been a new estate person but honestly I am open to it in the future. I think anything settling 2021/2022 onwards there will be profits to be made. I’ll be on the lookout late this year and next year for low cash down deals with hopes to flip but I will have a backup plan of holding tenanting if things don’t work
If you have been following the market you probably know this is risky territory now with a lot of developers discounting the final product and land being release slowly. H&L are good in boom periods, pretty bad when the tide changes.
Someone I know have turn around 2 properties, holding 1 as an investment which is positive cash flow at the moment and have another one on the way. His all properties are in Tarneit ( 25 KM from City). The strategy was is to get OTP land at initial stages. He managed to get all land in stage 1 and bought all land at a cheap price, $190 - $205. Criteria for buying land was having at least 12.5m front and at least 370 sqm in total. Nothing more than 400sqm. All properties building cost was in between $230K - $240K. Total finished cost to have a property in between $430k - $440k ($200k Land + $230 Buidling). Similar build house in the area are getting sold at least for $550K. Thats straight away $100 K for equity or cash(If he sells). Not sure what will be the implication of the tax and other charges? There is also saving (at least $15K) on Stamp Duty as he only pays on the land instead if buys an established dwelling. Nearest established suburb is Hoppers Crossing however there is a difference of at least $50 of rent pw due to new house. What are the thoughts on this strategy? There are number of new estates available in Truganina, Pointcook, Melton, Rockbank, Thornhill Park, Mickleham, Mount Atkinson, Clyde.. there are more...
This works in a rising market, not in a sliding one. That land your mate bought would now be well into the 300s.
Thats correct @Westie. Though still some other newer estates, OTP land are available for less than $250. In my opinion there are too many of them available so chances of capital growth will be hard besides later on renting will be an issue, just because they are far from facilities and in some areas it will take at least 3 - 5 years before things will start getting into shape.
