Should I Sell, Renovate and Subdivide

Hi All,

This is my first post in this forum and have been on few times.

I bought a IP South Road Moorabbin Vic 3189 and it in a intersection of two major roads and right outside is a bus stand. The property went less than the area hence my last bid became last and couldn't get out of it.

The question I have now is should I put the property on the market and cut my losses or should I renovated the front house and sub-divide as it is 2nd house from the intersection of two major roads and right outside the house entrance it's a bus stand. So construction will be expensive I am guessing.

The original house is 3 bedrooms, 1 bath room brick house.

I don't have renovation experience however it is something I would like to get into and was looking for property do so.

The land size of approx 7,201sqft/668sqm.




I really appreciate your feedback.

 

What was your initial intention to do with the property when you turned up to bid for it (and won) at auction?

 

Exactly. What was your original intention with this purchase.

 

To subdivide and Renovate the front out. I have been looking to get a house Subdivide, renovate the front and build one in the. But we feel having the intersection and the bus stand will cause buyers look else where when we finally put into the market and cause the building of the 2nd house more expensive.

 

... I am really puzzled
1. Is it just buyers remorse?
2. Wouldn't one look at the intersection and the bus stop etc before the auction?

That being said, Sparky see if there's any wiggle out of the contract. Although, as it was an auction I'm not sure there would be any clauses.

If you think it's a dud, cut your losses now. It will be a very expensive lesson though.

 

Do you feel that you bought the property at a decent price considering the location?

Have you calculated the losses if you just sold?

What about getting actual quotes for renovating, or try do most yourself, and building at the back?

Have you considered living in the front and renovating, whilst subdividing and then just selling the vacant lot at the back? Sometimes this provides a better, quicker return.

Whatever you do in your next step, do your research and don't make any impulse decisions.

Good luck!

 

I spoke to the agent and they said they can put it back into the market again.
It's just I bought as my first project and I am a first time renovator.
I just would like to know if you guys would buy such a property and would be a waste of time subdividing and renovating and not making money. We don't know what the market will be in the future.
LifesGood, I like your idea about subdividing and selling the back. I wonder who would have a good person getting advice.

Also you are right I did make a impulse decision in buying this place.

 

How much did you pay and when?

Usually, when people get a property for less than the value in the area they are pleased!

 

@Sparky19_007 what you need to do is sit down and write down purchase costs including stamp duty, holding costs, subdivision, renos etc.

It may be in a crap location but if you got it for a great price, do the project in an economical way and then sell for a realistic price...all the while making a profit....well then you've got yourself a money maker.

It's irrelevant where the property is and what it is. It's all about the numbers.

 

Could be that you just 'feel' it but actually people don't mind staying close to an intersection or next to a bus stop if the price is right.
Since, you bought it a 'good' price, can you hold on to it for sometime and sell when/if the price goes up.
What is the current yield if you put it for lease? Is that so bad that you cannot hold on to it?
In the mean time, you can go through the subdivision process and sell it based on the DA.

My amateurish 2c

 

I live in the next suburb.

Based on the description, the position may be fine. The property is very close to a TAFE.

The train station is possibly not quite walking distance - assuming the property is closer to Warrigal Rd than the Nepean Highway. But it is on a road that leads to the beach - maybe seven minutes away by car!

 

Hi @Sparky19_007
I live in the area, and I've also purchased, sub-divided in the area also.

From a business perspective, first thing you'd do is add all your expenses up and see what the property "owes" you. Then look at the land.
Is it suitable for subdivision? There are alot of variables that you need to understand to have a good idea. Speaking to council is the first step, but you'll need to ensure the site will comply with carpark requirements, private open space, access etc.
An experienced town planner would be able to answer these questions and provide you with more information on the sites suitability, and what you'll need to do.

It's very hard to provide you with more specific suggestions without knowing the site layout or the numbers from a building/potential profit perspective.

Feel free to PM me if you want to be more specific and I'll give you my thoughts. I have my 3rd project in the area with council at the moment and have a pretty good idea on what to look for.