What would you do? Duplex vs luxe build

Discussion in 'Investment Strategy' started by Poppy, 12th Feb, 2020.

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  1. Poppy

    Poppy Well-Known Member

    Joined:
    7th Jul, 2017
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    Location:
    Sydney
    This is a duplex VS retain single family home build decision.

    So 2y ago we bought our dream block on the beach in Sydney for 2.5mil. The long term goal was to hold and in ten years when kids are teens build duplex. Live in one, rent one.

    Rent the one with the massive pool as we won’t want the cost and hassle when kids move out. Or sell one (not sure if I’ll have to pay CG)

    3 mth after purchase we were being offered 3-3.5mil; houses in our street on identical blocks now go for 3.5-3.8

    I am itching to put on a second storey which is costed 400k. This would be an upstairs duplex and I’d probably spend 25% further on premium fittings - and it could be our luxury top floor apartment in retirement.

    The original idea is also very appealing, to do a total knockdown - the beach house is classic weatherboard dating back to 50s and I feel it will be old and ready for knockdown by 2030. I also don’t like that the current 50s house takes up only one quarter of the 1000m2 block, wasting so much land, and has only one inside bathroom. A modern premium new duplex is the best idea for us, combining new design and enabling us to live in one and rent one. More flexibility.

    A further idea is to do BOTH— put on a second storey now, use/enjoy/rent it for ten years (it would rent for 75k pa) and do the knockdown anyway....

    Any thoughts or insights from those in similar situations?
     
  2. spludgey

    spludgey Well-Known Member

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    Sydney
    The worst of both worlds!

    Do the duplex. This is an investment forum, you'll get advice focusing on investment.
     
    Poppy likes this.
  3. Archaon

    Archaon Well-Known Member

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    Newcastle
    @Sackie deals in this space alot, maybe look at a few of his threads.

    If you are being offered 3.5mil, would you be looking at 3mil each for townhouses?
     
  4. Poppy

    Poppy Well-Known Member

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    Location:
    Sydney
    Probably not 3mil for a townhouse - if land is worth 3.5, half that is not 3. More like 2 for a townhouse (duplex)
    But if it had a plunge pool, high spec and 4b/4bath probably more
     
  5. Archaon

    Archaon Well-Known Member

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    Location:
    Newcastle
    If you aren't going to make a substantial profit (>30%) then there would be no point in building townhouses.
     
    housechopper2 and thatbum like this.
  6. Sackie

    Sackie Well-known cafe bum of the East Premium Member

    Joined:
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    Location:
    Vaucluse, Sydney.
    What would you do? Duplex vs luxe build?

    Totally depends on the feasibility. It all comes down to the numbers and whatever makes financial sense. I would keep all my emotions out of it too.
     
  7. Scott No Mates

    Scott No Mates Well-Known Member

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    Location:
    Sydney or NSW or Australia
    1000m² with good planning gets 3/4 townhouses or 2 x duplexes in the location with a good planner.

    Big difference in the profitability by doubling the development potential.
     

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