VIC Thomastown/Lalor

I'm looking to get some information from people who are buying or have bought in either of these two Suburbs . How is the current market for freestanding houses in particular? So much of the stock goes up for auction. Currently researching the area to see if it has any key growth drivers that I'm looking for.

 

@Rockys ,

both suburb will have ripple effect from Reservoir/Preston.

i have development site in Thomastown and indication is that end value is heading north!

 

Are you selling off the plan or waiting for completion?

 

My son is looking at a PPOR in this area and the market is moving pretty quickly at the moment with decent sized blocks going for a premium.

 

@Shahin_Afarin

i definitely want to sell hallf and keep possibluy

planning to sell half in couple of next month

and

Possibly sell one on completion and keep one.

 

@Coota9,

it is a stiff comp between developers and FHB in that area..

 

Firstly...congrats on having the Cahones to go out on your own with Be Developer.

It seems there price point of new 2 bedroom T/H is 340-360 and a 3 is 380-420k in Thomastown.

Just curious..on how the numbers are working. I think you mentioned that you have a 4 unit site. Assuming acquisition costs of $450k all up. Lets say the build cost for 4x 18-20sqm T/H is 880k....holding, sell costs, development approval costs are another 70k....so the end cost is 1.4m.

If each of the T/H sells for 400k-420...that is $1.6-1.68m. That leave a proift of 200k-280k.

Do you feel that is enough profit for the risks expended. The reason I ask is because I feel on the Northern corridor...the land for Houses is shooting through the roof. I feel you can easily pull 100k out of these deals on say 320-360 build in aobut 8-9 months time. If you did 2-3 of these you would get the same result for less headaches..??

It is possible that I might have got the above numbers wrong...

I also feel that the Melbourne culture is very different to Sydney...they prefer a house to a unit/T/H/Villa unlike Sydney. Thoughts?? For the record...I am putting together or will be commencing on 3 H&L packages in Melbourne/Geelong. I am looking for more. One is already at the frame completion stage...one I am getting the contracts done...the other one...the land does not settle till Feb next year. Just looking to see the other side of the coin of development. Unlike you I am really...really...lazzzzyy....zzzz

 

Areas?

 

@sash

hahha... aren't we developer of all colors are lazy..


Okay this one will be long one but i ll explain in details as much as i can (to best of my knowledge)

Just curious..on how the numbers are working. I think you mentioned that you have a 4 unit site. Assuming acquisition costs of $450k all up. Lets say the build cost for 4x 18-20sqm T/H is 880k....holding, sell costs, development approval costs are another 70k....so the end cost is 1.4m.

those townhouses arent that big enough.. and not high specs as you think thus cost will be lot lesser then you calculated... circa 600 sq meter block fitting 4 townhouse on it.. you get the drift (Wont happen in Sydneyy)_


If each of the T/H sells for 400k-420...that is $1.6-1.68m. That leave a profit of 200k-280k.

end value isn;t that high.. total project cost would be around 1.1M and conservative bank valuation is $1.4..s o there is about $300k in it.

Do you feel that is enough profit for the risks expended.

Yes and no (Can discuss on this on one of meet up)

The reason I ask is because I feel on the Northern corridor...the land for Houses is shooting through the roof. I feel you can easily pull 100k out of these deals on say 320-360 build in aobut 8-9 months time. If you did 2-3 of these you would get the same result for less headaches..??

This is where i would like to use your famous line "viva la difference" in a good way. my motto is "together we will go far!!!"

as @MTR mentioned.. that there is not a huge difference in what you are doing and what us multi dwelling developers are doing..just looking at different angle.

I can adopt your strategy and i can make money and vice versa..


let's look at hypothetical numbers and scenarioWithout considering Market movements)

each h & l package give you around $100k take 8-12 months to complete (Without factoring in time for land registration) x 3 = $300k profit

Project like thomastown takes 12-18 months delivering $300k project X2 = 600K profit

my first project delivered $350k profit..so naturally i am chasing bigger numbers...

but all types of development bought well and executed well works..

 

Great thanks for the honest post...I thought so...I agree just difference strategies and efficiency.

Yours is more efficient than mine....where as yours will take effort once...I will need to source 4 individual deals. 300k is nothing to sneeze. at!!

Agree with you....the deal has to be bought well from the start....

Cheers
Sash

 

@sash

believe me effort once = source 4 individual deals

i must share story with you of one of my client..


he approched me few weeks ago.. with one request i am not interested in $200-$300k profit.. i am interested in min $500k profit. .can you find me site??

anyway,, we bought a site in vic for him... in current market, if he decideds to develope .. he is looking at cicrca $1m profit....

his project details are here http://bedeveloper.com.au/portfolio/( 2nd on list)

 

north of these suburbs there is a big availability of greenfields from epping onwards ... Will whittle sea council release land further and further north in the near future ? When they do -Will this have a impact on these suburbs?

 

Development sites in Thomastown and Lalor have soared and end values I believe are now starting to move.

Anyone looking at this area should focus on properties that are close to amenities, transport etc.

I am in Melbourne at the moment, very interesting times indeed. there is a real hype in the air, good times when property is booming

MTR

 

Good times ahead if you already own property in these areas haven't bought into a market like this before and also have never bought a property at auction and most properties in this area are going up for auction

 

I have a site in Thomastown too, was trying to get 4 units on aswell but council has been difficult and looks like ill be only able to get 3. luckily values have risen so i can still walk away with a small profit and lesson learned ( some peoples lessons can be more expensive! )

i believe the area has already had good growth and i know there has been a lot of hype around reservoir and preston but i would have thought this has rippled out to thomastown already?

i haven't seen a lot of new double story townhouses coming to the market in the area either, have you got any comparable sales from agents.

being perth based i don't really know melbourne very well but i have visited the area a couple of times and its a very nice suburb, anything close to the train station is pretty solid if you ask me. the area is clean and tidy. epping shopping centre just down the road. fingers crossed there is some more growth to come

 

@BLAIR_ ...heard about your site in passing
.


Lets hope everything goes well.... 3 unit wells designed will still see some decent profit.

I suppose you have seen my site..it is right across school n few meters away from station ..so value will be much better..

Location was the key for me.

 

Hi Blair
Believe this Council is becoming a pain in the rear when it comes to getting developments over the line.
What BeDev mentioned have a closer look at the numbers, 3 bedders are in high demand, perhaps the numbers could work.

Melb is certainly a hot spot at the moment. There are certainly better areas where end values are higher which potentially are far more attractive, the key at the moment is trying to secure these prior to the herd jumping in.

Back to your scenario, I think I also read somewhere that you considered selling plans and permits, have you looked closer at this in terms of whether it would be an attractive to builders??

Cheers
MTR

 

Son is trying to purchase a PPOR in Thomastown at the moment and prices are taking off in a big way in that area..

 

Thanks for all the updates everybody. How long has this market been strong for ?

 

Can only give you my point of view due to my son looking for a PPOR in the area for the last 3/4 months.
Majority of properties do go to auction (as is the Melbourne way)and we have noticed a big shift over the last 4/5 weeks..