South West Sydney - Renovation & Development
Making over $300,000 profit in 12-months.
Being strategic, we retained the existing house and converted this single dwelling lot into a detached dual occupancy. We were able to utilise the large corner block to subdivide and sell two individual houses on Torrens Title.
Aerial View - Original Site
New House Construction
New House Construction
New House Construction
New House Construction
The Search
Today, we embark on a thrilling journey to find that one property, in this challenging real estate market of 2023, that can give us substantial returns in a short period of time. Brace yourselves, because this is going to be a wild ride!
To tackle the unique challenges in today's market, we gathered an elite team of experts. Our architects, town planners, and financial analysts have been working day and night, scrutinising the rising construction costs and assessing properties for their potential renovation or development opportunities. Armed with our research and unwavering determination, we set out to find the perfect investment.
After months of tirelessly searching, we finally had a breakthrough. Our network of trusted agents stumbled upon an overlooked property in Sydney's South West, where the sellers were not aware of its development potential. The property was marketed as only having 'granny flat potential', when in fact it had dual occupancy development potential - a BIG win for us!
Given our relationship with the selling agent (having bought multiple properties from him before), we were positioned in an advantageous position to get this one over the line.
Original House
There were multiple offers on this property from a mix of home buyers and investors, but with insider info from the selling agent, we were able to submit an offer that the vendor couldn't resist - securing this amazing property for only $755,000.
The property itself was a 4-bedroom brick and tile house on a large 701m2 corner block, meeting the minimum lot size of 700m2 for a dual occupancy within Campbelltown Council zoning. With existing tenants in-place, we were able to utilise this time (with a rental income) to come up with a suitable design for the new build and get all our approvals in-place.
As our development was CDC compliant, it meant that we didn't have to go through Council to get it approved, saving us a huge amount of time and holding costs. Our CDC approval came through within 45 days, whereas Council's lead time was around 10-12 months.
The house itself already presented well, however we decided to put some new life into it to achieve the highest possible sales price. This included new flooring, fresh paint, down lights, ceiling fans, a new vanity and shower screen in the bathroom, laundry fit-out, a new bench top in the kitchen, a carport, some landscaping and an exterior refresh (roof/gutters painted, driveway sealed and painted brickwork). A lot of this was also DIY, saving a large amount of cash.
Purchasing
Costs
Purchase:
Stamp duty:
Legal fees:
Disbursements:
B&P inspection:
TOTAL:
$755,000
$29,000
$2,200
$1,850
$600
$788,650
Project
Costs
Construction (new build):
CDC Approvals:
Council contribution:
Renovation:
Holding Costs:
TOTAL:
$377,484
$9,085
$20,330
$23,981
$87,000
$517,880
The Location
Given the unpredictable property market in 2023 with rising interest rates and inflation, we needed to ensure the location for our next project was going to be resilient to any market downturn. Our chosen property was located in Sydney's booming South West region, only minutes away from major amenities including Campbelltown Hospital (undergoing massive redevelopment), Western Sydney University, Macarthur Square Shopping Centre and train station, private schools and colleges, Billabong Parklands (under construction) and more.
Western Sydney University
Macarthur Square
Campbelltown Hospital
The Project
Our initial criteria was to find a property that had renovation/flip potential, however given the large corner block we were able to secure, we decided to do a renovation and development for a win-win outcome.
With all our due diligence completed within the cooling-off period, we were given the green light from our architect, town planner and private certifier. We then reached out to some local builders to obtain estimated costs for the construction. With all of these coming in at similar prices (between $360k - $400k), we were confident in the numbers to ensure this project was going to be feasible and profitable.
With the existing house, we decided to simply give it a cosmetic renovation. There was no need to do anything major or structural with the property, given it already had a good layout and bones. As we were splitting the block in half, we did need to remove the existing large pergola to accomodate space for the new build and meet the setback requirements etc.
After the block split, each resulting lot was approx. 350m2, so we had to be strategic with the new build design. Not only to meet Council's setback and FSR ratio requirements, but to also ensure both properties would retain enjoyable spaces such as privacy, yard areas, natural light etc.
We could've squeezed in a 4-bed/2-bath house on the new lot, however this would've impacted the above mentioned aspects, so we decided to opt fo a 3-bed/2-bath house (+ study nook) instead. This not only reduced our build costs, but it also worked much better in the space and suited our target buyer market (first-home buyers/couples).
With new build being fresh with light coloured brickwork and modern features, we wanted to tie in the existing house to the new one, so we decided to go with a light coloured facade on this one too. The internal renovations also received a similar neutral finish to the new build, which appeals to the broader market - at the end of the day, we design, renovate and build our projects to attract as many buyers as possible, rather than focusing on our own personal taste.
Check out progress pictures below.
The
Results
Purchasing Costs:
Project Costs:
Selling Price:
Agent's Commission:
Marketing Fees:
Gross Profit:
ROI (OVERALL PROJECT)
ROI (ON CASH INVESTED)
$788,650
$517,880
$800,000 + $850,000
$29,700
$4,400
$309,370
24%
77%
Thanks for joining us on our journey.
Let the Ready Set Buy team help you with your next property purchase.
Whether you're looking to buy a family home to make your own or an investment property to renovate or flip, Tome and his team are here to help.
Get in touch today for an obligation free chat!
