Raise big upfront cash strategies - subdivision

Discussion in 'Loans & Mortgage Brokers' started by Ichigo, 24th Jul, 2015.

Join Australia's most dynamic and respected property investment community
  1. Ichigo

    Ichigo Well-Known Member

    Joined:
    21st Jul, 2015
    Posts:
    74
    Location:
    Perth
    Subdivision requires a bigger cash amount being available upfront. What strategies can be used to raise such large amount of cash upfront?

    For example, I assume the following amount is required in cash upfront (correct me if I'm wrong with the items/numbers & if any is missing):
    - 10% deposit
    - Stamp duty
    - $60 per sqm of property to be demolished
    - Big trees removal ($2-4k per tree)
    - Subdivision costs ($25k per lot)
    - Interest repayment costs
    - buffer (extra 5% of purchase cost)
     
    Ichigo, 24th Jul, 2015
    #1
  2. 380

    380 Well-Known Member

    Joined:
    19th Jun, 2015
    Posts:
    1,353
    Location:
    Australia
    Professional fees and contribution cost.

    Investors use LOC or cash to fund the cost of subdivision.
     
    380, 25th Jul, 2015
    #2
    Ichigo likes this.
  3. Mick C

    Mick C Well-Known Member

    Joined:
    18th Jun, 2015
    Posts:
    206
    Location:
    Sydney
    What Be developer said ....

    1. Cash out / loc/ Equity

    2. Cash

    3. Private funding for the sub
     
    Mick C, 25th Jul, 2015
    #3
    Ichigo and 380 like this.
  4. Ichigo

    Ichigo Well-Known Member

    Joined:
    21st Jul, 2015
    Posts:
    74
    Location:
    Perth
    @Be Developer, just to clarify, isn't the contribution cost and subdivision cost the same thing? I was referring to the local council cost when I listed 'Subdivision costs ($25k per lot)'.
     
    Ichigo, 25th Jul, 2015
    #4
  5. HD_ACE

    HD_ACE Game-Changer

    Joined:
    18th Jun, 2015
    Posts:
    491
    Location:
    Perth
    Depends on state.
    In Wa depends on which council and number of lots so something to look into for your target areas.
     
    HD_ACE, 25th Jul, 2015
    #5
  6. Ichigo

    Ichigo Well-Known Member

    Joined:
    21st Jul, 2015
    Posts:
    74
    Location:
    Perth
    thanks. looks like it's $30k per lot in my target area.
     
    Ichigo, 25th Jul, 2015
    #6
  7. eggnog

    eggnog Well-Known Member

    Joined:
    22nd Jun, 2015
    Posts:
    126
    Location:
    All over the place
    Thats cheap. Would love to do 30k per lot subdivisions. You sure you've costed everything? Im looking at 60-70k per lot.
     
    eggnog, 29th Jul, 2015
    #7
  8. Ichigo

    Ichigo Well-Known Member

    Joined:
    21st Jul, 2015
    Posts:
    74
    Location:
    Perth
    I mean 30k per resulting lot. So for a simple subdivision of a plot into 2, it would be 60k.
     
    Ichigo, 29th Jul, 2015
    #8
Paying too much CGT or tax – Or not enough ?

Not all tax advisers are property focussed specialists and DIY errors will always cost you. We know property taxes and will advise and get it right. Even a second opinion. Contact us for an obligation free initial consult (conditions apply).