Sell or hold large block (w/ old house) in an increasingly busy court?

Hi,

Would like to draw from the wisdom from this forum. I have an IP in Melbourne inner west (around Footscray). It's a 700 m2 land with a 3br old house.

It's located what used to be a quiet, leafy court. However the court has seen a lot of development, 10+ new townhouses in the last 3 years. It's getting busy and the small streets are getting full with parked cars.

I'm wondering ...

1. Is now is a good time to sell before it gets even more developed and council is reluctant to approve new developments (and owner-buyers are more reluctant to buy in a crowded place)
2. Or, holding is an equally good strategy as council will still aprove developments even if the area becomes fully built up, and maybe as land becomes rare the property will become in-demand in the future?

The area itself has seen good growth, and it seems to be flattening at the moment, at least in the short term.

Appreciate all your thoughts!

 

Big picture. I'd suggest put a DA on it. Then either sell to a developer or develop it yourself assuming the numbers stack up. You might be able to keep a couple if you do this.
Get proper advice first though. And you need to know what you can actually put on the block. @MTR, @bedeveloper may be able to provide input.

 

Sitting on a gold mine!
Hold, Hold, Hold and watch soon enough developers knocking your door down with sacks of money.

 

contact the owner of the adjacent block(s) to sell a big combined site, split equally by $/sqm

 

first you need to check the zone it is in. is it GRZ or NRZ (unlikely as it's not kew or facing some parks) or RGZ. i would just hold it and landbank as footscray is on the rise. I currently have more than 1200 sqm in RGZ (residential growth zone) in other suburbs. i would wait it out.

 

I'm in that situation at the moment. The street is a bit of a construction shambles. Not a good time to offload to an OO.

Swayable sellers have sold
Developers swept through
The heat is off
But time will renew


(Been a 16 hour work day...)

 

Thank you for your insights.

So far no-one has advised selling because council might be reluctant to approve further developments, so I'm assuming this is not a realistic concern?

(I just realised that yet another property, a few blocks down, has plans for 4 townhouses already advertised)

@melbournian The property is zoned 'GRZ1 - General Residential Zone Schedule 1' ... which I think is an older designation? Not too familiar with what these zones mean, will do some research.

@Gockie DA = Development Application, same as a planning permit application I assume? I don't have definitive assessment however an agent commented that it should fit 4 townhouses. Of course, he wants my business so I take that comment with a grain of salt.

 

Yes that's right. I'd suggest putting the DA on it yourself though or trying the "joint sale with neighbour route" too as an option.

Question. How much demand is there something like this? I reckon putting the DA on it yourself will add value to the land. Question is, how much additional value?

 

GRZ is not an old designation, it is actually new and was introduced last year. The schedules are different based on location, demand and could mean additional vegetation overlays, more development overlays, permability or height restrictions. There are a lot of people who do not really understand them. Was bidding at auction and while during the break, chatted to all the bidders and suprised no one really understood what there were.

The 3 main ones for residential are :-

1. NRZ Neighbourhood Residential zone.
2. GRZ General residential Zone
3. RGZ Residential Growth Zone

you need to go the department of planning schemes

Maribyrnong Maps - Planning Schemes Online

click on the map which is likely to be 8 o r 9 for footscray


i had a quick look at the schedule 1 : it just defaults back to the residential design standards



Understanding the Residential Development Standards (ResCode)

The purpose of this practice note is to ensure a common interpretation and consistent application of the 13 residential development standards in Clauses 54 and 55 in all planning schemes in Victoria.

The standards are:

· Street setback – Standards A3 and B6

· Building height – Standards A4 and B7

· Site coverage – Standards A5 and B8

· Permeability – Standards A6 and B9

· Side and rear setbacks – Standards A10 and B17

· Walls on boundaries – Standards A11 and B18

· Daylight to existing windows – Standards A12 and B19

· North-facing windows – Standards A13 and B20

· Overshadowing open space – Standards A14 and B21

· Overlooking – Standards A15 and B22

· Daylight to new windows – Standards A16 and B27

· Private open space – Standards A17 and B28

· Front fences – Standards A20 and B32.

 

@melbournian Wow, thank you for the info. That's a lot to digest. As far as I can tell it means that development is generally allowed (as evidenced by the townhouses in the area) however it does not seem to specify max density, so I guess it's at council's discretion.

Hard to say I guess whether council will block further development ...

 

You should speak to a Townplanner or architect but if you want to understand more it is all in the Residential Development Standards (ResCode).Purchasers normally look to this initially when looking to purchase. With Density I think you are concerned about "site coverage" which his basically the percentage of the land which you can build on. and permeability. As there are no maximum - these would be the answer

A5 and B8 Site coverage

The standard limits the proportion of any lot that can be built on, to provide outdoor space for residents, and to protect the amenity and character of neighbourhoods.

Standard A5 and B8
The site area covered by buildings should not exceed:

the maximum site coverage specified in the schedule to the zone, or

if no maximum site coverage is specified in the schedule to the zone, 60 per cent.


A6 and B9 Permeability

Limiting hard surfaces reduces the volume of stormwater run-off, which reduces pressure on urban drainage systems and helps protect water quality in downstream waterways. This standard limits the amount of hard surfaces that can surround a new development.

Standard A6 and B9
At least 20 per cent of the site should not be covered by impervious surfaces


So 60% from 700sqm is 400sqm should be enough for 4 places ground floor 100sqm each with upper storey 60sqm. But speak to a town planner or architect - there are always ones who are local who deal with the maribynong council.

 

To build 4 units on 700 m2 you would have to be in a high density zone. You can build 4 but you will either end up with awkward floor plans like these Sold Price for 3/1 Derreck Avenue Bulleen Vic 3105 or have to do underground car park like this Sold Price for 5/17 Hakea Street Templestowe Vic 3106 which is very expensive.
The other consideration is height restriction due to the land size which will be 9 meters.

 

Depends on the council you are in.

For footscray anything goes even 350sqm+ my mate's place got subdivided into 2 townhouses.
I've seen 600sqm been split into 4 though sharing walls in preston, st Kilda, reservoir, oakleigh, clayton etc. Even 480sqm is split into 3 townhouses sometimes. Maybe not the greatest product but more margin for the developer.

It is unlikely to work in doncaster or balwyn areas as the buyers there prefer mega mansions.

 

@MrFox In the same court 2-story townhouses have already been built, 3-4 to similar sized lots, so this council approved that kind of density in the past. My concern is whether they will continue to do so in the future.

@melbournian Agree in this area (inner west) I've seen some pretty aggressive subdivisions.

 

How old are those unit developments 3-4 on 700 m2? You have precedence in your street so it is unlikely they would stop it. 9 meters is double storey, 3 storey you need 11 meters height limit.

 

In parts of Port Melbourne you can build right up to the foot path. Few years ago I have seen 100 m2 block for sale with plans for a townhouse. It was a back yard of a pub.

 

If you on the main road like Doncaster Rd or Manningham Rd you can but the units are very hard to sell. Balwyn after rezoning last year has been pretty much locked up for development off the main roads. Most you can do is 2 on a block (NGRZ). You will do better building a 40-50 sq. French Provincial mansion and selling it for $3,500,000.
At the moment I have noticed the market in Balwyn is bit tough. Most auctions don't sell.

 

I tried to get something in balwyn once in auction and severly beaten and embaressed by the level of competition. Again most stuff in boorondara is hard to do much with NRZ. My friend did one in kew and after that was unable to develop anymore and had to go looking for newer suburbs to do stuff. Eventhough manningham is pro dev with it's DDO8, I can't play in doncaster or doncaster areas, they're just too expensive for me to even get anything compared to few years ago.

 

Any opinions on what the market for Footscray and surrounds will look like in 12 months? It looks like flattening but my crystal ball is a cheap one from Kmart