WA Post a Bargain - Perth

Discussion in 'Property Analysis' started by MTR, 17th Jan, 2017.

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  1. boeman

    boeman Well-Known Member

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  2. Westminster

    Westminster Tigress at Tiger Developments Business Member

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    It would have been totally under water water/flooded last month and won't be looking that pretty. It's uninsurable and can't be build on.
     
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  3. Westminster

    Westminster Tigress at Tiger Developments Business Member

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    You can see the aftermath of the flooding in this cool nearmap which unfortunately was taken about 11 days after the flood but you can get the gist of where the flood went to

    https://inlapse.com.au/m/l/2JIF2FF

    Edit: put wrong link in. https://inlapse.com.au/m/l/P5RR3IN this one shows the end of Swan Street and the water went all the way to the road and beyond in some parts
     
    Last edited: 9th Mar, 2017
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  4. Chabs

    Chabs Well-Known Member

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    If its costing $1.18m for DA approved site, what would cost to build be and estimated home sale price? I'd hazard a guess of about 600-700k total building/finance/legals/etc costs? that would mean you would have to sell it at about 2.2m-2.4m total to be worth it, or 700 to 800k each. Is this possible?
     
  5. MTR

    MTR Well-Known Member

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    Have not looked at build costs in Perth lately ... but I did not build my deve in willagee because I would want to sell villas close to 600k each however bottom fell out of market
    This project is an absolute bargain/give away price. These villas today should sell for at least 500k each
     
  6. Big Daddy

    Big Daddy Well-Known Member

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    I remember getting outbid for that block. It sold for 640k in 2015 so I'm not sure how this guy is making any money when you add in holding costs . Why not just sell the land since it's quicker and less risk.
     
  7. Westminster

    Westminster Tigress at Tiger Developments Business Member

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    That price included the construction I thought?
     
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  8. MTR

    MTR Well-Known Member

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    Right, I assumed the owner of the land held it for years so still profit in the game.
    then something is wrong, build costs not included??? otherwise makes no sense whatsoever
     
  9. boeman

    boeman Well-Known Member

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    I had completely forgotten about the floods, makes sense.

    Shame, as it looks amazing. Also a shame because wedding venue hiring is like printing money.
     
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  10. Westminster

    Westminster Tigress at Tiger Developments Business Member

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    @boeman

    I know! It's a lovely spot and I wanted to buy one of those blocks when they were up for sale for under $400k (!!!) only a couple of years ago. I thought maybe if I built a Queenslander on stilts it would be allowed but City of Swan said "no, no, really no, definitely no". It wasn't just the building of a house it was the inability to put in septic tanks that wouldn't leach into the river system, the fact that any structure could change the way flooding works and cause issues somewhere else.

    The people that use those lands are allowed sheds (which I argued was still a permanent structure) and I'm bloody sure some of them have toilets but I didn't push it too hard.
     
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  11. Phase2

    Phase2 Well-Known Member

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    It's advertised by HBA? I thought $1.18m it was an all-in cost too. New villas are only on ~250sq.m blocks. Looking at what other stock is selling for I think they'd be lucky to get around $450k ea.
     
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  12. MTR

    MTR Well-Known Member

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    Ok
     
  13. boeman

    boeman Well-Known Member

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    I went to a wedding in the "secret garden" in Caversham. By secret, they meant out the back on the river. Last I saw it was completely underwater, but the actual Caversham house is about 10m up on retaining. Bit unfair, though I am guessing it was all built many years before the rules came into play.
     
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  14. mrdobalina

    mrdobalina Well-Known Member

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    Yeah. I read that as $1.18m with the 3 units constructed. Assuming construction costs is about $600k, which would just be bare bones or poor finishing. It'll cost another $100k to finish off. They are effectively selling a DA approved site for about $600k.

    If each unit is valued at $480k each, then that's about 10% profit.
     
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  15. Westminster

    Westminster Tigress at Tiger Developments Business Member

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    $600k would go pretty far in that project as there is very little building on boundary or weird structural elements. Might not include headworks though
    I don't see how the old owners going to make any money selling it but people sell at a loss all the time when they need to.
     
  16. Jess Peletier

    Jess Peletier Mortgage Broker & Finance Strategy, Aus Wide! Business Member

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    The guy selling it is a builder broker - I'd heard he'd gone bankrupt? Completely unsubstantiated rumour though.
     
  17. mrdobalina

    mrdobalina Well-Known Member

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    Yeah, I heard that too.
    I wonder how a building broker goes bankrupt???
     
  18. Jess Peletier

    Jess Peletier Mortgage Broker & Finance Strategy, Aus Wide! Business Member

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    It's a tough market at the moment, so I guess less people building, and less people getting finance for developments in town would take its toll.
    Or maybe a few failed dev's of his own?
     
  19. Westminster

    Westminster Tigress at Tiger Developments Business Member

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    Yes he is personally bankrupt but the business is not. People go personally bankrupt for various reasons and I have had a conversation with Richard about this and I was happy with his reasoning and that it doesn't affect the business or the services offered to me which I use. The business was restructured to take it into account and continues on.

    I've known a number of people in my lengthy life experience who have had to declare bankruptcy and most of them had little control over the event where they were a tradie/small business and weren't paid and couldn't afford to pay goods/services they had on account. It doesn't take much to send businesses to the wall. Builton going into Liquidation forced at least one business into bankruptcy
     
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  20. Ross Forrester

    Ross Forrester Well-Known Member

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    I have seen a few building brokers go under over time.

    I think that is a hard game. The Builton fallout is still spreading.
     
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