Category: Developing A Property

What Subdivision And Development Buyers Are Snatching Up (And How You Can Too)

While most Perth property is only just starting to perk up, interest in subdivision and development sites has been building up for the last year. The right sites have a buzz of interested buyers at the home opens.

As an example, a corner triplex site in Greenwood auctioned recently had 9 registered bidders vying for the property in a fierce bidding war. A whopping 61 bids delivered a sale price of $521,000. This was $80,000 over the reserve price! It was by no means a bargain, and there were many hugely disappointed bidders left without a property. (more…)

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Hot Property – CORNER TRIPLEX SITE (for 3 street-front homes) $500,000’s

Today, we’d like to share a stunning development property a CORNER TRIPLEX SITE.

Corner development sites are hard to come by. The right one is like gold because you can subdivide into STREET-FRONT LOTS without a driveway to the back.

This one ticks all the boxes and that’s why the weekend home open was totally swamped with buyers, mostly developers! (more…)

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Yield or capital growth – which property investment strategy should you go for? (ANALYSIS)

If you’re just starting out in property investment and you’re not sure which investment strategy is right for you, it’s worth exploring the differences between yield and capital growth.

Understanding the differences can help you work out which strategy is right for you, and therefore the type of property you should be looking for. (more…)

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What’s the difference between a real estate agent and a buyer’s agent? (Q&A)

While most people know what a real estate agent – or seller’s agent – is, it seems not everyone knows what a buyer’s agent is – or does.

So we thought we’d break it down. (more…)

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Securing the right property – cosmetic appeal versus capital growth potential (TIPS)

Coat of paint

You know the old saying: “Don’t judge a book by its cover.” Many investors place too much emphasis on looking rich rather than becoming rich, and make the mistake of buying properties based on cosmetic appeal instead of their capital growth potential.

Buying a property just because it’s pretty could mean you end up with an under-performing investment.

Our go-to tips for weighing up aesthetic appeal versus potential capital growth include: (more…)

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What you need to know about property development (TOP TIPS)

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So you want to buy a property to develop or subdivide, but not sure where to start or what to look for?

Knowing how to secure a property with superior development potential can be difficult, especially if you are just starting out.

Here are our top tips for a successful development project: (more…)

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Building wealth by subdividing – benefits and pitfalls

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Any investment presents risks and rewards that must be properly understood before buying.

This is certainly the case when buying property for redevelopment. You can keep yourself occupied, but all your hard work could be for nothing if you’ve not done your homework.

“Less than 1 per cent of development-potential sites generate a profit”

You may be surprised to hear that small developments are by and large not profitable.

Less than 1 per cent of sites advertised as development-potential sites generate a profit for the new owners. In fact, the really good, profitable sites for a buy/develop/sell strategy generate just 15 per cent profit.

Don’t be greedy and hold out for the traditional 20 per cent yield properties as they are so few and far between you may miss out on few good deals by chasing a big one. (more…)

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How to profit from a small development

Investing in bricks and mortar continues to be a popular method of wealth creation in Perth, backed by historical evidence of long-term gains and the current lull in prices making property more affordable.

Many investors like to take their investment in real estate a few steps further… rather than just buying a new investment property, they aim to accelerate their progress by finding a property where value can be added through subdivision. However, while it’s smart to squeeze as much profit or cash flow as you can from a block of land, don’t fall into the trap of thinking the buy-develop-sell instantly strategy is a shortcut to big profits. (more…)

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Know your market before spending on renovations

Know your market before spending on renovationsThe home renovation craze is inspiring more and more West Australians to renovate for lifestyle and profit.  The Master Builder’s Associations’ Gavan Forster said while ABS figures reveal around $500 million is spent on renovations in the State each year, the actual figure is closer to $2 billion. Kitchen and bathrooms top the list, followed by adding a second storey or another bedroom.

The team at Property Wizards believe you can’t beat buying to add value, whether through renovation, development or subdivision, as long as it’s the right property in the right location.

If done wisely, increasing the value of your investment through home renovation can boost your cash flow and improve your chances of attracting and keeping good tenants.

However, not all renovations are equal and there are some common pitfalls to avoid when deciding how to best add value.

Renovation traps to avoid

Overcapitalising is a key risk to consider.  We believe it’s important to know the market when looking to add value to an investment property.  Seek advice and find out what has sold in your area.

Understanding the market will also ensure you don’t limit your resale potential by spending money on features that buyers don’t want.  For example, a below-ground pool or a fancy garden may improve the look of the house, but you may not get your money back.

A recent survey by the Commonwealth Bank revealed West Australians are the keenest renovators in the nation, although they are also the most likely to go over budget and over deadline.  As a result, 56% of respondents were forced to make compromises, such as simplifying their designs or skimping on the quality of materials.

Hidden versus visible improvements

It is often good to add value in a visible way, particularly where the repairs are cosmetic and low cost, for example replacing grotty kitchen bench tops or a rusty letterbox.  Hidden improvements however, like rewiring or plumbing, are often expensive and don’t add much value.

A good way to get ‘the most bang for your buck’ is to look for ugly or shabby features that can be easily fixed.  These may include replacing or updating old floor coverings, window furnishings, light fittings, cupboard handles and tap ware.  Painting in light, neutral colours is another way to add cost-effective value.

Consider providing more storage options, improving the street appeal and front entrance or installing a shade sail or a deck in the backyard.

If you decide on a major renovation, we recommend you ensure your property is structurally sound and engage professionals to do the job so it doesn’t end up costing you in unforeseen expenses.  A professional design concept is also essential and you may be required to get Council approval.

With good advice, research and careful planning, the right home renovation can increase your equity and put more money in your pocket.

Property Wizards Logo and tagline If you have an interest in building your wealth through property, then call us on (08) 9381-7450, or request a FREE Starter Pack.

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Do you see a dump or dollar signs? The 5 cosmetic appeal rules to invest in property by

This simple makeover added thousands of dollars more to the value of the property than it cost to renovate.

Many investors place too much emphasis on looking rich rather than becoming rich. They can mistake a good looking property for a good investment, buying based on looks instead of growth potential.

Successful property investors, with multiple properties that grow in value, are not flashy, appearance-conscious people. They look to the bottom line make purchase decisions based on facts rather than feelings.

Buying the right property in the right location is the way to go to grow your wealth, regardless of street appeal.

If you buy a property just because it’s pretty, it could mean you end up with an under-performing investment.

Remember, an ugly duckling property in the right street can be a better prospect to make you wealthy than an attractive property on the wrong street.

Some key factors to consider when weighing up aesthetic appeal versus potential growth include:

  • Growth should be your number one priority at all times. Just because a property looks impressive or is well maintained does not automatically mean it will perform well in the growth stakes.  It is always better to select a property with superior growth potential than one that simply “looks nice.”
  • Be a visionary. Less attractive properties are often overlooked because most people can’t see their potential. This is where clever investors can make money by picking up properties which have great growth prospects, but with a lower price tag. Remember, you can come out on top by spending a little to prettify your “ugly duckling” investment. Those savings will usually more than cover cosmetic improvements that can turn your property into a lucrative swan.
  • You don’t have to get your hands dirty. Many buyers say they don’t want, or don’t have the time, to repaint or recarpet their new investment – but you don’t have to do it yourself! When considering buying one of these properties, simply factor in the cost of hiring someone to do the work. Hire qualified professionals to take care of this for you.
  • Cosmetic improvements may help boost your rental return. Snapping up the right property in the right location, and then beautifying it can increase your rental return above that of more expensive, already-attractive properties.
  • And don’t forget – you can improve the look of a property, but you can’t convert a low-growth property to high-growth one with just a lick of paint. This means staying focused on securing properties with key growth drivers, such as proximity to the city, lifestyle attractions or the ocean.

 

Property Wizards Logo and tagline If you have an interest in building your wealth through property, then call us on (08) 9381-7450, or request a FREE Starter Pack.

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