Hey Brokers, From experience who is the best lender in this space, with consideration to policy, highest LVR and any other important considerations. I am considering taking on an owner build and paying a project management fee to a retired builder friend. So realistically I would not be doing anything except paying the trades. I appreciate there are a heap of risks to consider and at this stage it is just an early thought. We did however sit down last night and there is a potential to save 60k for a far superior product than the 5 build quotes I already have. Thanks in advance
Difficult. Most of the lenders want one of the applicants to hold their own owner builder licence (or be a registered builder). LVR's are low + there needs to be an extra % of cash or equity contingency buffer held too.
if you want to build, the best and cheapest way to do it is to approach some volume builders at the end of the month, get a couple of quotes and shop them around. While a fixed price quote is usually a little more expensive, it means your covered if the site costs blow out. Seriously, there isn't a cheaper way if you need to lend against the build. If you have cash for the build, consider a modular or removable home. Some of these can be quite cheap. Be prepared for some resistance from valuers as to their end value however.
Very encouraging thanks tobe LVR I could get under 50% but my friend doesn't have a license. I know it has been done as a mate of mine did it about 3-4 years ago. Guessing times have changed?
not so much, owner builders have never been easy, there must be something else to your mates story. If the lvr is 50%, my best suggestion is raising 90% on the land and trying to get to certificate of occupancy with the rest of your own cash. Once you have the COO you can refinance for the money to pay your credit cards back, and do the finishing touches. Pretty risky IMHO. Is this a PPOR or investment?
Owners build 80% LVR + have 10% buffer in cash ( so really 70% LVR to show only...but can be funded at 80% ) if you have some sort of experience. No exp....than i would say 70% LVR with 5% cash buffer. ANZ/ NAB and CBA ( more NAB ) is going to be your best bet.
Thanks Mick You and Tobe seem to be on different pages though? Do you have recent experience? I have no experience so would be treading around the 70% with 5% buffer but I have that money available.
I cant speak for Mick. I haven't had any recent experience with O/B, in that when the potential client sees the difficulties, they change their mind or do it a different way. The last research I did showed BOM/St George as the best but only available to registered builders. NAB seemed to do a bit 'by exception' which is always helpful.....ANZ only lend to 80% of the land value. I cant remember exactly how CBA do it, but I doubt it was any better.
CBA don't touch o/o builds. NAB do 60% (they say 80% but you need to show a 20% buffer so its essentially 60%) St George will do 75% if you are a licensed builder or 60% if you are not. Back to your question - St George and NAB are your best options (based on the very limited info provided)
Haven't done one in a while but the effective lvr for most nab on is around 72 % but is dependent on the land component They will buffer the build component by 20 % so if your land value is big the th effective lvr wil be okish TA ROLF
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