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DH and I are thinking about buying some land with friends and subdividing, then each of us building our own home. Just looking for a ballpark to build a house, nothing too fancy, probably 3 or 4 bedrooms and a couple of bathrooms. Any experience anyone has with this would be great cos we've got none!
I only know what the average is for WA and its around $180k-$200 for something very nice not over the top but very nice :)
Goodluck ooh how exciting :)
Just out of curiousity how much to subdivide???
How long is a piece of string? Hehe. Really depends on what you want in it, how big you want it, how many bathrooms, where the land is...and lots lots more. Dont think you could really get an accurate ball park figure unfortunately .. unless ladies that have built come in and post what it cost to build their house? & what was included..sorry not much help
Thanks Bee, that's around what I was hoping it would be. Not too sure about the sub-division etc here, but need to look into it. Houses are so expensive in my area, that we figure if we can get a decent block, knock down the house on it and then each build, we should be able to get something good for about half the cost.
One thing to consider is that you are allowed to subdivide and have separate titles. There is a place around the corner from us where they built two houses on the block, but can't separate the land - so they have to be sold together which really limits the number of potential buyers. Just something to keep in mind.
We subdivided our block - the original house was way off to one side and we are living in it at the moment - and are building a new house. The builder is being mindbogglingly slow getting back to us about how much it is going to cost, but it came to about $14,000 for the subdivision and will probably cost $120,000 for the house once we add in all the juicy extras. We're in the country though and are building a reasonably large and fancy transportable - the starting price of the house was $85,000 so there's a LOT of extras above the listing price.
You can usually get something decent built for $160k and subdivision is usually around $20-40k, depending on how much sewage and water works you need.
Watch out for sloped blocks - sometimes it can be impossible to divide and build two houses on a block with a slope the 'wrong' way because the rear house needs crazy easements to get the water to the street.
As an architectural technician, I feel I can give you a bit more light on this.
Firstly, this is a very 'open' topic, with alot of variables that would effect the overall costs, depending on typical build costs (Tasmania for instance is dearer to build than say Melbourne or Sydney), and local councils way of doing things re subdividing.
So I will try to be fairly broad with my '$' and just say you'll have to do your homework.
- to get a ballpark figure, builders work on a $ per square metre rate. On average, in todays economic climate you can work on around $1000-1200 per sq/m, inclusive of EVERYTHING, floor coverings, appliances, paint.....the lot. Start with this. Again this fluctuates depending on state and if you are in metro or rural. (What I can advise though is the things that make a house more expensive to build are elevated and off the ground ie NOT concrete slabs, lots of windows, and handrails.)
- also dont always trust the prices shown by builders that mass produce houses, there is always hidden costs.
- you say houses are so pricey in your area, chances are that builders prices to build a new house are also high. Their costs follow the trend and market in particular areas.
- subdividing is a very open thing too. Yes it can be quite cheap to subdivide ($20000 mark) but this can depend upon local councils. Some councils do not like small subdivisions like you are suggesting, as they want developers to subdivide large parcels of land, because councils get certain monetary handouts when they approve subdivisions. This is quite legal, its just how it works. Developers want to subdivide land because they make loads of money, and councils only feel it is fair to receive their piece of the pie. A friend of mine wished to make a seperate title from his parents farm, and the counci charged him $60000!!! Again, do your research.
- another factor in subdividing (as someone suggested) is distance from existing water and sewerage mains, because if new piping needs to be put in, then the costs go way up. Same with power.
- also if you were thinking of doing something with say, 3 or 4 friends (ie building 3 or 4 houses) then council may want you to put in some form of road network, and this is very pricey. This obviously would be dependant on shape of site and location to existing roads, but councils can be very anal when it comes to town planning, believe me. They are not interested in people making gravel driveways etc, (again this depends where land is located ie rural or residential) and also depends of councils town plan.
- having 2 seperate buildings that people live in permantly is not permitted by the Building Code of Australia, only if the are deemed as units, and then that is another thing, which then involves development approvals from local councils which need to be drawn up , different type of construction etc etc (what I do as part of my job), and this all cost a decent amount of money.
- you mention getting a decent block and knocking down the existing house. This isnt as cheap as it sounds. You have councils fees for demolition (not too pricey), paying a demolition man to do it (its illegal to have a go yourself unless licenced), costs to remove the demolished material, if it is an older house extra cost to remove and dump asbestos. Demoltion can be quite pricey and not as clean cut as it sounds.
so yeah, a little bit of my thoughts/knowledge of it all from my experience :)
But, like I said at the start, there are soooo many variables to this topic, and just do your research, talk to local councils about subdividing of smallish blocks etc.
Hope this helps some! Any other queries just ask!
we didn't subdivide but it cost us...
200k house (4 bedroom)
25k extras (the things we wanted like evap, carpets, tiling, etc)
20k extras (the things we didn't know about like upgrade slab, council fees, temp fencing, connections, etc...)
167k land
5k stamp duty
now that we are in our house we spent
2.5k fences
3k driveway
3.4k security doors
we are now saving for more concreting, slate tiles, grass and general landscaping
We built a 4br + study (27sq Inc garage) for 204k +land
That's inclusive of everything, driveway, floor coverings etc site costs ( we built on very rocky, reactive clay soil so big excavation costs and slab upgrade)
Pandora: Are you able to say on here who you went through?
Gudism: Approx how much would it cost to demolish a house? We are looking into doing this but I think it is going to turn out to exy
Dennis family.
We did house and land with fixed site costs. Places won't generally do that if you have your own land already though
Gudism - we live in an absolutely brilliant pro-development council. They have a grand plan for this town that involves pretty serious expansion so there are small and large subdivisions all over the town, and some have been required to build roads and run power like you said as you need street frontage here to subdivide. They let us subdivide our block despite it being 1m too narrow and not complying with modern building codes (the existing house was ON the boundary and has two windows on the boundary wall - it was built in about 1900). We can have gravel driveways! We've created a tonne (if not several) of demolition rubble fixing the old house but most of it has disappeared as neighbours ask to take it for scrap metal, firewood, building their own stuff etc.
I'd love to build a duplex here. That might be a good option for the OP - get a wide block (check council development plan as to how wide - here you need a 20m wide block to do it and there's plenty of blocks that size available), build what is effectively two long, thin houses joined in the middle at a common firewall under one roof but with separate electricity and water meters, and after the house is finished you can subdivide it into two titles at your leisure, taking it from a dual occupancy duplex to a strata or even a plain old torrens titled duplex.
I have no idea how that would work for financing though, you'd probably all need to go on the one loan to do that and then buy each other's halves out when you subdivide it later. And you'd have to be damn sure you can subdivide it later or you won't be able to have your *own* halves.
Oh - one more thing. MONEY. Not trying to put you off the idea, but ...
Say you buy an old house on a big block that suits your requirements for $400k (pulling numbers out of thin air here). You demolish it straight away costing $20k, then subdivide for $40k, then you start to build. While you are waiting for all this to be approved, *someone* has to pay interest on $460k (less deposits) and that is a lot of money and depending on the council you could be waiting up to three years from buying your house to moving into your new house.
Can you really afford that? What legal protection are you going to have if there are multiple people involved in purchasing the land? You might have a falling out during that time or one couple finds their dream house elsewhere and wants out, leaving the other couple with the full debt.
Also you may have huge difficulties getting a loan to build the house, if you have say 2 couples involved in the initial purchase and all 4 people are on the loan, while they won't tell you this upfront, when it comes to assessing serviceability (how much you can repay) the banks will decide that each person is responsible for the whole $400k not $100k each, and when it comes time to get the loan to build the house you find you are all in too much debt to get extra money for the house because of the way the bank deems responsibility for the debt.
Just things to watch out for.
Thanks so much for the info ladies. At this stage it is just an idea and I was hoping to see if the budget we have in mine is doable iykwim? Generally speaking a 3 bed house in my area goes from anywhere between $1 and $2 Million. Something that we'd be happy with would be about $1.5 million (out of our reach right now).
What we're hoping is that we can sell our current property and come out with enough to purchase 50% of a block of land. In the meantime we'll rent while we go through the permits, sub-division and building process so we're not paying two mortgages, just the one lot of rent. We'll then borrow to fund the building.
Working roughly, we're thinking that if we can get a suitable block of land for $1 million (split 50/50 with either my Dad or some really good friends who are in a similar position) and then have $300,000 for our share of the subdivision and building it is something that is worthwhile doing. After all it would allow us to have a suitable long-term house in the area that we love, that would cost us a lot less than it would ultimately be worth. But the problem is there are so many variables involved, what if you buy something, pay to have plans drawn up and then can't get the subdivision? It's such a big leap of faith to take...
Gudism can you explain how it works with Units or a duplex? Can you set up your own Owners Corporation and side step the subdivision process that way?
I'll give it a go in the meantime - two or more houses on one title is 'dual occupancy' and needs nothing special, but you can run into issues with council doing that and you cant sell the houses/units separately. But it can be a really good way to start just because of no subdivision costs.:
You're thinking Strata titling, which I'm a bit vague on. You still split it up - I have no idea how it works or how much it costs - and then have some kind of entity handling the strata stuff, which covers common areas. You can set up your own entity. Everyone in the strata pays a bit each quarter into some magic strata fund that is used to do things like maintain common areas (for large blocks of units this is things like the roof, common parking area, driveway, outside lighting, pools, lifts etc). You can sell the houses/units separately with strata titles. The rules for sizes and so forth on strata divisions is wildly different for a normal subdivision, strata is most often used where there is common land or multiple storeys with units above each other and you can't physically divide the units up onto discrete blocks of land.
Hey Miss E - DH is at work right now, but I'll get him to look at this when he gets home tonight :)
(if you didn't already guess, yes, Gudism is my other half)
We are going through this at the moment - I bought the house 8 years ago and it's more cost effective to knock down and rebuild than to try and renovate or sell & buy something equivalent to what we are building since we are only 6km's from CBD. We aren't subdividing though.
Demolition - $10K
House - 3 bedrooms, 2 bathrooms + study $265K - when we sat down with builder we told them everything we wanted included such as luxuries as stone bench tops/floor to ceiling tiling in bathrooms/ extra coat of paint etc in price so we weren't hit with any hidden extra's and we could take out if we needed to reduce cost
Extra's - flooring, blinds, aircon/heating, rainwater tanks, driveway, fencing etc $50K
I want to move where you live!:
We are building an IP at the moment. Land aside, the house itself is costing us 220k. That is for a small (115m2 Living + double garage) 3 bedroom, ensuite. But the cost of building here is quite high. Nothing fancy about it. Bottom of the range carpet, tiles, brick, everything - just plain old laminex benchtops. Seriously budget house. But that is all we could afford, and since it is an investment, it doesn't need anything but basic fittings.
Demolishing a house is very exxy. You could be looking at round 30-40k just for that (sometimes lots more, sometimes less), and you will have to call in the specialists if it has any aspestos.
Truthfully, it would likely end up cost just as much as buying an already established house anyway. And I would be extremely wary of your plan to do this with friends, because what happens in the 'worst case senario' and someone looses a job, or otherwise can no longer afford to service their portion of the loan. Unfortunately the banks will not care that you have already paid you portion, they will expect you to cover the rest as well. You will be liable for the entire debt, if for some reason they decide not to pay.
I would've thought that we would each have our own seperate mortgage and finance. Is that not possible?:
Yes if they had to get out in the middle of it all we'd probably be forced to sell up too because we wouldn't be in the position to buy them out, but with the financial side of things being handled separately at least our credit and assetts would still be in tact.
[QUOTE=misty;2405356]I want to move where you live!
Pandora - Wish it was that price round here too :) We've got reactive clay soil here too and are being slugged $23K just for footings!
Misty - wow it is expensive to build in Canberra!!! Even though we've only got 3 bedrooms we'll end up with 205m2 (not including garage) of living space plus alfresco area.
It isn't possible to have seperate mortgages for individual entities secured against the one property. A bank generally will not allow a mortgage against a security unless all the owners are listed as applicants and/or guarentors.
A crafty mortgage broker may know some ways around this, but as far as I am aware the only way around this in to use some other security for the finance, rather then the property which is being purchased.
I was thinking that we'd use our own money to purchase the land (if we did it with my Dad he'd do the same, but not sure about our friends). Once we had the approvals etc then we would borrow to fund the building. Surely if we had the subdivision approved the banks would be happy to allow us to borrow separately for the building wouldn't they?:
Yeah, you'll have to go joint for the initial loan and then refinance so you each have half after subdividing. In the meantime you will each be effectively responsible for the entire amount of the loan. Silly, but that's how it is.
Did a bit of asking around the office today re demolition. Depending on the size of the house and age (eg if it has asbestos etc) cost would be between $10000-$15000. (but as high as $30000):
Again this is fairly ballpark, some demo guys would do it heaps cheaper too. It depends on if they are busy or not, or want to do that sized job etc.
Most demo guys are fairly open to questions, so call up a few and ask.....I might be right off the mark with my price!
RumpledElf - great to see a council that isnt a PITA and bends their planning scheme and is reasonable
Most builders will give a square metre price dependent of what you want. I have heard around $1500 from some people, but that would vary where you live.
explained by RumpledElf as well as I can explain.: