Volume builders for an odd shaped subdivision

Discussion in 'Development' started by Boreas, 11th Dec, 2017.

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  1. Boreas

    Boreas Member

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    Hello PC Community,

    Long time follower and first time poster here. After reading, learning and doing endless researches, I finally secured my first site in Mooroolbark, VIC. The site is on a corner with a decent 3 bedroom house located towards the front of the block. The plan is to build a 3 or 4 bedroom single storey house at the back with its own street frontage. I have agreed with a private town planning company which has its in-house surveyors and draftees. According to our initial assessments (following surveys etc.), the newly created block at the backyard will be somewhat odd shaped with a 16 mt street frontage and narrowing down to 12.5 mt at the back. On the right-hand-side the block is 30 mt deep and on the left-hand-side it is 25 mt deep. To add to the complexity, there is an easement (which we cannot remove as there are council drain pipes underneath) on the right-hand-side approximately 2.5 mt from the boundary.

    I have just received the concept drawings and it looks like we'll be able to fit a decent 4 bedroom single storey house at the back. However, I am a bit worried about the building cost of this custom design when (hopefully) we get the planning permit. The house itself is approximately 195 m2 (the block is around 395 m2) including a double garage.

    So, I was considering whether I should go with an off-the -shelf design from a volume builder and let them handle the council approvals. After much research, it was obvious that due to the odd shape of the block, if I go with an off-the shelf design, I will have to make significant sacrifices either from the footprint of the house or the functionality or both. It is also not too clear to me what would happen if the council would not be happy with the off-the shelf design (after I signed the contract with the volume builder) and requests changes be made. I know that volume builders do not like changing their plans and charge hefty variation fees for doing that.

    The thing is, Mooroolbark is a mid-to-low income suburb and a brand new 4 bedder would probably fetch $750k in today's market whereas a 3 bedder should sell for $700k in my location.

    Therefore, I would like to seek the wisdom from the "been-there-done-that"s of the community. In your experience, is it worth getting a custom house drafted to utilise the site better and pay a bit more (how much more???) when building or would it be better to settle with a smaller off-the-shelf house (and hope that there won't be any changes required in the design during the approval process)? What if I go down the volume builder route and we will need to make heaps of changes to the design so much so that it will be better to pick another off-the-shelf design instead. How will the volume builders treat this and are there any get-out clauses in the contract if it proves that it will be impractical to seek an approval for the design that we signed the contract for?

    How much do you think will it cost to build a custom designed mid-to-low spec single storey 195 m2, 4 bedroom-double garage house on a flat land with easy access in north-east Melbourne?

    Any input and advice is much appreciated.

    Boreas
     
  2. Sackie

    Sackie Well-Known Member

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    Did you do any feasibility before purchasing the site? To me, many of your questions should have been asked and answered before the site was bought.

    With regards to what to build, well you need to build what the demographic wants. No point going with 'off the shelf' if your stock wont sell. Equally no point going custom build if you wont get a return on the premium your paying. I would think all these questions would be addressed with an initial feasibility to see if there even is a decent profit margin to begin with.
     
    Last edited: 11th Dec, 2017
  3. Marg4000

    Marg4000 Well-Known Member

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    Can you build a two storey house, similar size but smaller footprint?
    Marg
     
  4. Boreas

    Boreas Member

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    Thanks a lot for your responses.

    I've done feasibility before I bought the site and I think either way, there is enough fat in the deal. Mooroolbark has a lot of a 3 bedroom 1 bathroom old houses but I believe market is changing and there is demand for low maintenance 4 bedroom family homes. The issue is, I anticipate around $80k difference in building costs between off-the -shelf 3 bedroom volume house and a custom 4 bedder and around $50k difference in selling prices. However, what I am finding difficult to estimate is whether the volume builder costs would escalate to a point to make going down that route less desirable. That's why I am asking about people's experiences with volume builders in odd-shaped blocks.

    @Marg4000: The site is in a neighbourhood zone. I understand that the council is in favour of single storey houses on that part of the suburb. So, a double storey townhouse will design will likely meet with a lot of push-back from the council.
     
  5. Sackie

    Sackie Well-Known Member

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    Once the contract is locked in and you agree with the specs, I don't see how costs could escalate much from there unless you keep making variations along the way.
     
  6. Boreas

    Boreas Member

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    I thought that we choose a design and sign the contract with the volume builder first and the builder would obtain the permits (for that design). What I am worried about is that the council may request some changes on the design which would end up increasing the agreed price due to variations. Having said that, I don't have a crystal clear understanding of the process with the volume builders.
     
  7. housechopper2

    housechopper2 Well-Known Member

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    Volume builder should do an assessment for you prior to signing the contract to determine what is possible. Variations from council should then be minor e.g. Repositioning a window etc.

    if you go with volume builder ensure you have a contract you are happy with and agree on what variations would be acceptable within the contract price before you sign it.
     
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  8. Westminster

    Westminster Tigress at Tiger Developments Business Member

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    Maybe go visit a few volume builders who deal in dual occupancy and talk to their dual occ team to see what their process is.

    For some builders it's contract after permits but decent deposit up front to minimise their risk. For others its contract up front and any permit changes required are treated as variations.
     
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  9. Boreas

    Boreas Member

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    Thank you for your responses @housechopper2 and @Westminster. I'll get in touch with a couple of volume builders to understand their processes a bit better.
     
  10. Sackie

    Sackie Well-Known Member

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    As said above, unlikely to be significant and it should be covered by the contingency.