Browse Forums Building A New House Re: Need some advice about building proposal 11Sep 16, 2019 11:51 am Designer,Engineer (Civil,Const & Envir),Builder,Concrete & Masonry Contract.Struct Repairs Re: Need some advice about building proposal 13Sep 17, 2019 12:14 pm My build with Inspired/ Como Homes: https://forum.homeone.com.au/viewtopic.php?f=31&t=93656 Re: Need some advice about building proposal 15Sep 18, 2019 9:44 am Designer,Engineer (Civil,Const & Envir),Builder,Concrete & Masonry Contract.Struct Repairs Re: Need some advice about building proposal 17Sep 18, 2019 6:53 pm Designer,Engineer (Civil,Const & Envir),Builder,Concrete & Masonry Contract.Struct Repairs Re: Need some advice about building proposal 19Sep 19, 2019 1:47 pm https://thomasarcherbuild.blogspot.com/p/blog-page.html - Thomas Archer Homes - Custom Nouveau 41 Re: Need some advice about building proposal 20Sep 19, 2019 4:12 pm Blacktea2sugars V002 Long post sorry about that. Some background first to better understand the situation. My mother owns a block of land which is 2 lots under 1 title, a splitter block. I've done some basic ground work to figure out the cost for her. About 22k for demo of the house, clearing of the block, including capping of sewer lines, power disconnected, demo approval, Surveying about $1800. Service connections (water/sewer) $9400. Splitting the titles about $400. Conveyancing $500 for 1 lot. Estimated about $34,605 all up. The lot we would sell is 445m2 which in our area are generally going for $435,000-$450,000. Our plan is to use the money from the sale of 1 lot to build on the other lot. A home from Ownit homes, Clarendon, McCarthyhomes and the like. Budgeting that build at around $300,000-$330,000. With the hope of coming out on the other side with $90,000-$100,000 left over. Now here's the issue. My mother doesn't have the estimated $34,605 needed to clear the block and demo the house. So we approached an acquaintance who has a background in property development. He suggested we enter an arrangement where the builder would take on the estimated $34,605 cost (my estimated cost). Build the house and use the 445m2 lot as a house and land package from their company. This seemed like a great idea to us at the time. We hoped to still come out on the other side with some money after selling the first lot. Skip ahead, we have another meeting with our acquaintance where this proposal was put forward. A company called Broadacre house and land would coordinate the project with FRD as the builder. A couple of plans we given to us for a 250.72m2, 8.1m wide 18m double story house. It has the requirements we needed. Downstairs bedroom and ensuite for mum. That was our only necessary requirement for the build. . We ask the inevitable question. How much money does mum get at the end of this. His answer was NONE. This shocked us completely. It seems the arrangement they propose, is for us to give them the 445m2 lot without them buying it at a reduced cost to cover the $34,605. Which I had thought would be the arrangement. Build us a small double storey house costing significantly less than the value of the 445m2 lot. Estimating the house proposed would cost the $280,000-$300,000 or so to build with the 445m2 lot being $435,000-$450,000. I asked our acquaintance to send me a costing of the house that would be built for us. I was told the builder isn't comfortable discussing numbers without a commitment from us. The commitment btw is $10,000 into a solicitors trust which is returned to us at the completion of the project. Which we are told will be 10-12 months. Then I was told what a significant risk all this was to the builder and we should be grateful they are willing to take this on. And the builder had already spent $1500 of his own money. Guessing this was for the drafts but was never told. Which seems odd to me. Wouldn't the builder have plans on hand and draftsmen in house? So my question is - What is going on here? Someone is making a significant amount of money considering houses in my area are going for around $850,000-$920,000. Am I being naive about this? Is there a significant risk to the builder? Should we just walk away? Don't just walk away - RUN! The reason why "they're no comfortable discussing costs" is that everything is marked up to the hilt. There is no way known a company is going to do a deal like that and come out with low profit. It's all $ to them. You mentioned a couple of times, an "acquaintance". I'm not comfortable with this, and don't think you or mum should be either. Is there an option for you (and potentially another sibling) to take out a loan or add to your mortgage for the abolition, demolition and title splitting costs? Would be so much better value keeping it all "in house". Yes, I'm exploring the other options now. It will be tough, but this 'proposal' put to us stinks the more I look into it. It will take time to do it all myself but as you said 'better value keeping it all in house' Hi VK, Think it's worth investing time in an Owner Builder course to equip you with basic knowledge on Australian Building Industry and its regulations. Also, I suggest… 11 23818 Levelling compound Ardit is the best but buy a bag of sand and make sand dam to protect your wood floor 2 15294 XCEM Alpha flooring seems to relatively new and I could not found any reviews. Have you or someone you know have used it and would recommend over other subfloor options?… 2 7623 |