About this project

This house was purchased as a half-completed renovation project in a good area of town. The plan is to put another house on the back yard, and potentially subdivide it.

Purchase evaluation

Key drawcards

  • address (excellent)
  • condition of house (fine except that it was half-renovated)
  • price (very sharp)
  • size of section (very large)
  • vendor motivation (they just wanted out, instead of finishing the few renovations left)

Caveats

  • flood zone
  • access for relocation
  • competition (multi offer deadline one week from listing date!)
  • easements and utilities creating restrictions on building
  • on-street parking is awful because of the commercial neighbours

Due diligence suggested that the obstacles were not insurmountable, and my evaluation was that it was profitable at listing price. If it wasn’t multi-offer, I would probably have taken another 5-10k off just because. But it was, so I stuck my usual odd-number-extra-money onto the listing price, and added a high deposit and quick settlement. No conditions - took a calculated risk on the building report - everything else I already DD’d on my own. I’m told I wasn’t the highest offer, but it was a clean offer.

Selected house

1970s original, 3 bedrooms 1 bathroom, 100m2. To renovate to 4 bedrooms with 2 toilets and shower over bath.

Numbers

Purchased house1: $350k (plus odd-number-extra-money)

Renovated house1: est. $40k (not all immediately, some of it waits for the refinance)

Rented house1: est. 550pw

Purchased house2: $85k (including transport and foundations)

Relocated house2: $40k (cost until on piles - no development contributions in SWDC)

Renovated house2: est. $60k++

(maybe) Relocated cabin: $???

Rented house2 and cabin: est. 650pw

Final value: $???

Timeline

Listed: Thursday 22 Jan

Open home: Saturday 24 Jan

Offered: Wednesday 28 Jan, to meet deadline Thursday 29 Jan. Unconditional.

Accepted: Friday 30 Jan (documents came through Monday)

Settlement: Wednesday 18 Feb

Rented house1: TBC

Contract on house2 signed: Sun 22 Feb (docusign + enthusiastic salespeople = weekend work)

BC in: TBC

House arrival on site: TBC

CCC applied: TBC

CCC received: TBC

Rented house2: TBC

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