SUNDAY TIMES - TOP TIPS COLUMN, BRETT AMOS

July 17th, 2005

by Brett Amos Buying Specialist, Property Wizards

Knowing how to secure a property with superior development potential can be difficult, especially if you are just starting out. Top tips to ensure successful developing include: "

Look for blocks with as little slope as possible. Blocks with greater slope will require a larger amount of retaining and earth works, which can greatly reduce the net profit on your project. "

As well as confirming the zoning on the block to ensure the development is possible, confirming the location of the sewer line is crucial. While some blocks will be advertised as a 3-unit site, the location of the sewer line can actually restrict it to a 2-unit site as dwellings can't be built on top of sewer lines. "

Look closely at the shape, as well as the size of the block. Irregular shaped blocks can restrict dwelling design, thereby incurring extra design costs. "

Look for a block where the cost is almost the same as the block value, so that very little of your purchase price is being wasted on the existing house. " With battle axe blocks, keep in mind that side access is required to be a certain width before any subdivision or building can occur. "

Obtain an estimate of the current market value of your planned development by at least visually inspecting all comparable dwellings on the market, as well as those recently sold " The estimated total sale price of your development, minus all costs, including block purchase, stamp duty, construction fees and an agent's commission should leave you with a net profit of around 20%. If this is not the case - move on and continue the search for a suitable development opportunity.

For more information, please contact
Mr Brett Amos
Buying Specialist
Property Wizards
brett@propertywizards.com.au
Tel: (08) 9381 7450