Browse Forums General Discussion 1 Sep 15, 2021 9:55 pm Hi All, Need forum members expert advise/inputs. Background - Had blocked a 400 SQM Land @ Melton South, Melbourne 3 years before. The land registration got unduly delayed and finally it is coming for settlement in 2 months from now. Am now facing dilemma on when to commence construction to let this property for rental and how much to spend on this investment property. Here are my questions - 1. I had seen photos (am not from Melbourne) and other than road and lights, the land estate is completely barren. What I can see in photos is just roads, roads and roads and lights. I assume it will take perhaps couple of years to at least get decent number of houses built there. So my first query, is it worth to just go ahead and construct the house. Am not sure whether any tenants will come for new estates where barely there are houses? If I construct the house and it remains unoccupied I think it does not make any sense. So, is it worthwhile just to wait for one year and then commence construction? In this scenario, to avoid price raise, am thinking of entering into construction contract with say Carlisle, Porter Davis, Metricon etc with a site commencement of say last quarter of next year. In other words, I would be just sitting on empty land and paying interest on borrowing for land, but perhaps this may be better option than constructing house and keeping it idle, but at the same time by locking the price, I am assured of no further escalation in price for construction. 2. How much I should spend? My block is 12.5 X 32 and am looking to construct starting from 22Sqs to 26 Sqs house. Here are my questions; a. Does a 26 Sqs 4BHK house fetches more rent than 22Sqs 4BHK house? Does tenants really bother for such small difference so long as they get 4 BHK house? Because I can save some amount there with 22 b. Most of the builders are giving 2590 ceiling height. I want to go up to 2740 ceiling height to give a view of more openness. Obviously this comes at a cost. I may be spending nearly 10000 dollars more on raising the ceiling height and raising internal doors height. Again does this appeal to propective tenants? or they do not care 3. Is it worth installing evaporative cooling system? 4. Is it better to just put carpet or upgrade to tiles/timber floor? Am planning to opt for all the above, which will cost me around 20K to 25K than a bare minimum basic house and I assume spending this money may be relevant, as in a new estate I wanted to make my house more attractive to the tenants, when several investors will be constructing and there will be many houses that continues to come to the market. Can anybody share their insights based on their experience.. Much appreciate your feedback, including between those three big builders, all or OK? Am aware been away from Melbourne, I just need to depend upon some builders as I cannot come and see, so big builders (even though in some cases the quality suffers due to bad site supervisors) looks better option for me than small custom builders Thx Re: How much should I spend on Melbourne Investment House? 4Sep 16, 2021 4:04 pm I live not far and I am building in the area you are. I know the area well. which estate are you building in, i can give you some indication of how its progressing compared to google maps (which are seriously out of date for the area btw). Melton and Melton South are in general growth areas. They are affordable (for now) places to build, rent or buy established homes. You need to decide the ultimate strategy upfront. 1. rent out 2. sell, or 3. rent long term and hopefully sell at a decent capital gain. 1. renting the property out - rental market in melton is ok. The rental market in the area is primarily made up by the socio economically challenged. So if you want to rent it quick, you need to consider making it appealing cost wise to that part of the market. If you can make it desirable from a cost perspective (rent price) and make it nicer than other places for rent you wont have a problem renting it out quickly. People with more money are building their own homes out there. Keep that in mind. So have a look on realestate.com.au at what the rental market looks like and see if you can do something comparable or nicer for the rent you're planning on charging to recoup mortgage costs. 2. if you're going to build to sell it straight away, i wouldn't bother. The sales market there is predominately people buying land only or people buying older established homes as they represent better value for the area (bigger blocks, older homes but completely livable and perfect for later subdivision or KDRB). 3. If you're going for the rent and then long term sell, then i would highly recommend putting some extra value into the home that cant be done later. higher ceilings for sure. Nicer finishes but chose durable stuff ie get nicer tiles and carpet (with good warranties), make sure you use stone benchtops as they wont fade or be scratched etc. And before long the only thing you'll need to do when it comes to selling is give the place a coat of paint. Remember that the m ore money you spend of these depreciating items, the better your depreciation schedule will be anyway. Just need to find the balance. Refrigerated air con will fetch better sales prices, evaporative is probably better value if youre just renting it out. +10k for higher ceilings and doors sounds a bit much for a 22-26 sq home. our 32 sq single story has both these things for ~7k and much of that comes with square set plaster cost built in and window heights upgraded. Dark matter scientist, can breathe underwater, mind reader and can freeze matter just by willing it. Trust me, its in my sig. Re: How much should I spend on Melbourne Investment House? 5Sep 16, 2021 4:19 pm Hi Noname, Sincerely appreciate for your detailed reply. Here are additional inputs; 1. My land is in Mapplewood Estate in Melton South, is part of their Stage 7, Expected registration is Nov Mid 2. My current goal is to build, make the house attractive than others, so I can let it out quickly, instead of keeping it idle because the house looks and feels like any other house. I am not going to sell this. This is going to be a house which will be rented out for next 5 years and potentially if we decide to move to Melbourne will be our primary house of living. 3. I will do some scan of realestate to understand the kind of house and what rent they are advertising? 4. Getting quotes from METRICON, CARLIESLE, P DAVIS and trying to balance out who would be better. At the moment, am rating them all same as at the end of the day they are major builders and I assume they will give decent if not superb quality 5. Will wait for your feedback as I gave name of my estate to get your views, on can I commence construction from say JAN next year as soon land gets registered and so house will be finished by July or Aug next year or you reckon better start the construction some where next year end, to allow some more activity, as I do not want my house to be the one of the few houses in a barren estate. Once again thanks for your inputs. Thx Re: How much should I spend on Melbourne Investment House? 6Sep 16, 2021 5:07 pm Venkata Hi Noname, Sincerely appreciate for your detailed reply. Here are additional inputs; 1. My land is in Mapplewood Estate in Melton South, is part of their Stage 7, Expected registration is Nov Mid 2. My current goal is to build, make the house attractive than others, so I can let it out quickly, instead of keeping it idle because the house looks and feels like any other house. I am not going to sell this. This is going to be a house which will be rented out for next 5 years and potentially if we decide to move to Melbourne will be our primary house of living. 3. I will do some scan of realestate to understand the kind of house and what rent they are advertising? 4. Getting quotes from METRICON, CARLIESLE, P DAVIS and trying to balance out who would be better. At the moment, am rating them all same as at the end of the day they are major builders and I assume they will give decent if not superb quality 5. Will wait for your feedback as I gave name of my estate to get your views, on can I commence construction from say JAN next year as soon land gets registered and so house will be finished by July or Aug next year or you reckon better start the construction some where next year end, to allow some more activity, as I do not want my house to be the one of the few houses in a barren estate. Once again thanks for your inputs. Thx Maplewood is coming along. That whole side next to the reservoir is much more progressed than the maps show. If you were on the other side of Exford road, that's going slow. if its going to be your primary residence at some point, you may want to get some nice things done to it. Maybe even considder splashing out for the refrigerated air. Regarding builders, Id suggest Metricon may not be the best choice . They already have a landmark case regarding a house they stuffed up so badly in Melton they were told to tear it down and rebuild by the court. Google Softley vs. Metricon for the details. Re quality, don't assume anything. You could get a good house or a dud. Because you aren't there to monitor (even if you were), i highly recommend getting an independent building inspector for each stage. The estate isnt barren. It definately wont be barren by mid next year. But i suspect your build timelines are a little hopeful. Delays with materials and covid , I'd add 6 months to your expectation. If you get it earlier, great. Dark matter scientist, can breathe underwater, mind reader and can freeze matter just by willing it. Trust me, its in my sig. Re: How much should I spend on Melbourne Investment House? 7Sep 16, 2021 6:49 pm Hi Noname, Thx for the inputs.I will check where my land comes when compared with the Exford road that you had said. Good that by mid next year chances of more houses looks interesting. I will exclude METRICON. Any view you can give on Carlisle, HomeBuyers Centre and Henley? These three appears to be other major builders. Just wondering, who would be better bet or rather better than others in terms of quality control or something to a minimum standard they can given. Yes I will engage external inspection. Am thinking of locking the price now with one of these three and ask them to commence the construction from mid next year and yes it may get delayed, but I do not want to start before mid next year. I can technically start in Jan/Feb, but just want to wait and watch, as I would had locked the prices. Pl let me know you have any feedback on the above three builders or for that matter Porter Davis also. Thx Re: How much should I spend on Melbourne Investment House? 8Sep 17, 2021 8:07 am Venkata Hi Noname, Thx for the inputs.I will check where my land comes when compared with the Exford road that you had said. Good that by mid next year chances of more houses looks interesting. I will exclude METRICON. Any view you can give on Carlisle, HomeBuyers Centre and Henley? These three appears to be other major builders. Just wondering, who would be better bet or rather better than others in terms of quality control or something to a minimum standard they can given. Yes I will engage external inspection. Am thinking of locking the price now with one of these three and ask them to commence the construction from mid next year and yes it may get delayed, but I do not want to start before mid next year. I can technically start in Jan/Feb, but just want to wait and watch, as I would had locked the prices. Pl let me know you have any feedback on the above three builders or for that matter Porter Davis also. Thx Firstly, you won't be locking prices in with builds that far in advance. Prices with most volume builder are increasing monthly. The base price of the house I am building now has risen 30k since April. That's not including any increases likely in the upgrades. The builder will lock your price the day you sign your contract for a period, and there are still provisions in contracts to increase the prices under certain conditions. Henley and Carlisle are considdered more premium than home buyers center. Home buyers center is a lower cost brand from boutique homes. Your choices with home buyers center in way of finishes will be more limited. Carlisle use a performance solution for their waterproofing that requires yearly inspections (at a cost to you) to maintain your warranty. Henly are supposed to be good and I love their houses, but I had a particularly terrible experience with their sales process, so gave them a miss. Their COO apologised to me after I sent them some pretty scathing feedback. That said you're not going to find the "perfect" builder. I'm currently building with boutique and have had an excellent experience so far. They cost more, but the level of service has been excellent. Both my neighbours have built with home buyers center and their experience has been the same. That's not to say everyone has good things to say, but this is not my first build (4th). BY far, they have been exceeding my expectations on everything so far. I've had a number of serious conversations around some items pricing and we've been able to come to really positive outcomes, pretty annoying extra things I've wanted them to do, they've been able to do, some reletively custom solutions have been catered for too. No one has ever said no we can't do that without looking into it. Even then 95% of what I've asked for we've been able to do. The other 5% was doable bit prohibitively expensive. They were still willing to provision for the work after hand over though. So happy days. In the end, you need to find a design that suits you and a builder that will work with you. But you need to temper your expectations about timing and how much control you have around the process. These are volume builders working to a schedule. Dark matter scientist, can breathe underwater, mind reader and can freeze matter just by willing it. Trust me, its in my sig. I thought this would be a popular question but I haven't been able to find any similar posts. Perhaps I'm wording my searches wrong? When you have car insurance and the… 0 6604 7 11929 They make the room much easier to clean for one, reflect more light (if light colour tiles are used), and you dont end up with dust on the top edge of tiles (cause most… 3 9570 |