Options for land size 900 plus! What on earth to do? - confused!

Discussion in 'Renovation & Home Improvement' started by Kitty Katty, 31st Jan, 2017.

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  1. Kitty Katty

    Kitty Katty Member

    Joined:
    31st Jan, 2017
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    Location:
    Smithfield (2164)
    Hi everyone!

    Ok, so jumping on the property development/renovating/kdr/granny flat build etc bandwagon!

    For 6 years (yes that long) my wife and I cannot decide on what to do with our property! We live in Smithfield on a big block 900plus. Our house is old, everything in original condition. Renovators delight you could say. Tiles falling off, new paint needed, raw floor boards, 60's kitchen and bathroom, needs replacing, small eating area, only fits 6 seater table. We need an extra bathroom and bedroom for growing family. We have paid off this mortgage.

    Option 1; We have enough $ to go ahead and build a granny flat at rear with the intent to lease. This would leave us with only 60k odd for renovations on our house (hardly enough?). We could use rental income to continue to renovate our house overtime.........(disruptions for years though?).

    Option 2; Use all our funds to renovate our house, add pool, make it top notch. Then, later on get a loan for granny flat out back and tenants can pay off that loan. (I like this idea as our house is in real need of tlc and it would be nice to fix it up first of all, granny flat second).

    Option 3; Knock down and build duplex. We don't have funds to live elsewhere during build unless we eat into our funds that would serve a small amount of the duplex rebuild costs. (could inject 200k or so into duplex build) This would be ideal but not sure bank would lend us the remainder of money? Would be a biggish loan? I only earn odd 50k, wife not working. The plan is to remain on 1 income until all kids at school - say another 6 years or so. We couldn't service loan initially on just one income and without tenants. Once we rent out one of the duplex' then the rent could pay our loan. Do banks lend you money on the basis that repayments could begin one we get a tenant?

    Option 4; KDR. Instead of building a duplex we could just rebuild a 2 story house meeting all our needs. The plan would be to build a granny flat first (have funds ready), live in granny while house is built. Then rent out granny using the rental income to service loan.

    I am not a fan of debt. Would prefer to live debt free. I have no super. Prefer to invest in property. If tenants pay loan then no worries. However if I was to retire tomorrow I would not be able to service a loan!

    1 more idea: sell up as is. Buy elsewhere.

    Your ideas are welcomed.
    Michael.
     
  2. Kitty Katty

    Kitty Katty Member

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    It's a tough one isnt it....
     
  3. Heinz57

    Heinz57 Well-Known Member

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    What are the dimensions of the block?
     
  4. Kitty Katty

    Kitty Katty Member

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    Hi Heinz57, thanks for taking the time. Yes we had a survey done. This is as far as we got! 14 wide x 60. Something close to that by memory. We are only allowed to build granny or duplex due to zone restrictions. We did consider building house behind existing however there are stormwater issues...would probably need to dig up someone elses backyard re drainage. Not too keen on that avenue cost wise and hassle wise. At present water pumped out onto street.
     
  5. Heinz57

    Heinz57 Well-Known Member

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    Yes those long narrow blocks are tricky for duplex, looking at one myself. If it slopes away at the back maybe extra drainage hassles you don't need with a young family.

    It is your home KK, can you pimp it up on a skinny budget ( modest extension, above ground pool?). For the risk / debt averse this could be a quick solution with opportunity to do the development later.

    Re the granny flat. Do you want a stranger living in your backyard? However a real granny is useful for babysitting.
     
  6. Kitty Katty

    Kitty Katty Member

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    Very very good points!! Yes you've got me thinking about strangers in yard, thinking long term it would be good for my kids once grown and married. I wonder if others have success stories of strangers in yard! Thankyou Heinz.