Rick is a family member who has often talked about tackling a modest townhouse project.
I had done all the hard work examining this site and negotiating on behalf of a client, and minutes before signing she pulled out due to unfortunate life circumstances. The vendors were extremely motivated, and willing to accept $150k less than the offer they rejected pre-auction 2 weeks prior. I called Rick up and he said “Let’s do it”.
Joint Ventures can work many different ways. In this project, Rick purchased the property and wore the debt finance. I funded all the planning and design work, and shared the holding costs (mortgage debts less rental income, land tax, council rates, etc) and the build costs 50/50.
It was a hard slog with a duplicitous and aggressive Council, and after having a multiple cracks at 4 townhouses we ultimately settled for 3 large, fully detached, street-facing houses.
Once the permit was secured and all construction documents completed, I looked after the build tender. A couple months in and COVID hit. Thankfully, the Construction Industry remained operational, but wow it was challenging. What a crazy time.
Rick chose to sell 2 of the completed townhouses and keep the 3rd as an investment property. We split the profits 50/50.
Leafy with big activity centre, transport, schools, and gentrifying property mix
1055m2 sloping rectangular corner
Tired, original weatherboard
up to $1.05m
Private Sale, Post Auction
House $0.860m | Unit $0.615m
7.2% p.a. over last 10 years
Increasingly affluent demographic; proximity to key amenities; top schools
Significantly under value; corner; top secondary school; good growth prospects
Three detached, double story (one with basement parking), street-facing, 4bed/3bath houses, approx. 27 squares each
38 months from purchase to completion
Harvey is a big earner, building a portfolio of negatively geared properties with value-add
Price : $1.850m
Location : Blue chip, affluent, close to hospitals, transport, shops and parks
Scope : 3 large, quality, detached houses
Profit : $0.900m
Return on Cash : 48%
Jim semi-retired from finance young and is building an impressive portfolio
Price : $0.950m
Location : Urban, gentrifying, with good transport and access to CBD
Scope : 4 attached street-facing townhouses
Profit : $0.475m
Return on Cash : 45%
Jack asked us to JV with him on a bigger site, and this made sense for us both.
Price : $2.125m
Location : Quiet, leafy, family-oriented with top schools and shops
Scope : 8 townhouse with dual access
Profit : $0.675m
Return on Cash : 58%