Delicious Developments | |
Case Study 1: Developing the Undevelopable Case Study 2: BTR Case Study 3: Developing the Renovator Introduction
Case Study 1: Developing the Undevelopable Number 20Number 18
Case Study 1: Developing the Undevelopable
Look at my new land sizes:
Case Study 1: Developing the Undevelopable Site Plan Street Elevation
Case Study 1: Developing the Undevelopable You just heard about scrapping From this… …to this
Case Study 1: Developing the Undevelopable Equals this!
Case Study 1: Developing the Undevelopable
Summary Non-development sites can often be development sites if you think outside the square The best place to buy is often in your own backyard…like your neighbour! Employ the experts Have at least a basic understanding of the rules Demonstrate what you want by showing similar projects If you believe something is possible but you are told ‘no’ ask again another way or ask someone else Scrapping is great! Opportunities exist everywhere!
Case Study 2: BTR
This property made me over $1 million…during the ‘worst financial crisis since World War 2’ Let’s take a look at how I did it.
Case Study 2: BTR I’ve done my research
Case Study 2: BTR There were two reasons why I was keen to buy this despite the other client’s poor feasibility 1.I already knew I had made 98k! 2.I used a different feasibility
Case Study 2: BTR Build to Sell doesn’t work for me…it just creates a tax problem! Capital gains tax PLUS I have an existing land tax issue
Case Study 2: BTR So I want to… B.T.R. …and If building to HOLD then design to HOLD!
Case Study 2: BTR And thanks to a comment I heard from Michael Matusik… I decided to build 10 x 1 bedders to rent!
Case Study 2: BTR The Construction – flats removed 25 th March 2008
Case Study 2: BTR The Construction – basement dug 17 th June 2008
Case Study 2: BTR The Construction – heading up 2 nd September 2008
Case Study 2: BTR Full height scaffold – roof time! 9 th December 2008
Case Study 2: BTR Walls battened and ‘rough-in’ complete 28 th January 2009
Case Study 2: BTR Rendering and painting 11 th February 2009
Case Study 2: BTR The finished product – July 2009
Case Study 2: BTR The finished product – July 2009
Case Study 2: BTR The finished product – July 2009
Case Study 2: BTR So what went wrong? I designed for fully furnished but no one wanted furniture! As a result…washing machine…fridge..queen bed Bloody energy saving light bulbs Storage area vs water meters Broadband cable Ponding White courtyard tiles
Case Study 2: BTR COSTS$ Purchase532,000 Costs26,000 Consultants/Appl.72,215 Build/Inf. Charges2,191,158 Holding89,115 Total2,910,488
Case Study 2: BTR END VALUE yield $3,952,000 Equity$1,041,512 or35.8% Rent$3,420pw $177, % gross + Dep.
Case Study 3: Developing the Renovator
Case Study 3: Developing the Renovator Paid $514k as a renovator…worth $580k as a development site!
Case Study 3: Developing the Renovator Develop “The price reflects the need for lots of work”
Case Study 3: Developing the Renovator 592m2 corner site Zoned for units/townhouse/SUDs House must be kept Can build to 2 storeys
Case Study 3: Developing the Renovator The site
Case Study 3: Developing the Renovator The site
Case Study 3: Developing the Renovator
The numbers: TOTAL COSTS$1.095m End value renovated house$575k New house$775k TOTAL END VALUE$1.35m Equity gain$255k Return on development costs 23.3% That’s the power of a quick reno and a small development.
Case Study 3: Developing the Renovator
Summary Employ the experts BTR or BTS RDC! Look for development sites at non-development prices for long term gains and options The 20% margin rule is misleading