Property Development Matters

Property Development

Matters

SUSAN LINDEQUE Linzen Group

HOW DO YOU CREATE WEALTH WHILE BANKS CONTINUE TO CRACKDOWN ON INVESTOR HOME LOANS?

The banks continue to crackdown on investor home loans where the standard variable interest rate on residential investment property loans have increased and the loan-to-value ratio lending is 95 per cent to 80 per cent, meaning much higher deposits.

It comes almost six months after the Australian Prudential Regulation Authority announced a major overhaul to investor lending, which has continued to ignite house prices particularly in Melbourne and Sydney.

Mortgage Choice CEO John Flavell said, “The ability for credit for investment purposes is getting tighter and harder, that’s going to restrict the amount of money people can access for investment properties.”

So the question is how do you create wealth in light of all the above changes? In ‘Secrets of the Millionaire Mind’, it explains the way wealthy people think differently or have a different mindset. One has to think of strategies outside of the box and development can provide the answer to that question.

Is it a good time to develop now? You bet it is! Development is the only vehicle where you can develop and own at cost price. It’s like buying directly from the factory, no margins from wholesalers or retail shops! Property development is a proven, long term strategy for accumulated wealth. It is well known that property values double every seven to ten years.

Where do you start then? Property development is dependent on fundamental criteria: management and finance skills.

Management criteria is dependent on three primary areas of focus: 1. Time Manage ment 2. People Management 3. Money Management

You have to efficiently manage the project to secure a higher profit margin. It is essential you don’t get behind on your emails and make sure you give feedback as soon as possible, or else you run the risk of delaying the project which will end up costing you money.

Do the Sums. Normally the process is you find your site and talk to the owner or agent about an asking price from the vendor. Ensure you do proper research so you don’t overpay. Research can be done via talking to agents, looking at online sites like RP Data, Price Finder or Investar.

Start with the initial analysis to determine if the project will be feasible or not.

Identify what you want to do with the block of land:

What is the size o f the land?

What is on the land currently that can add value?

Re novating the existing house?

What is Cou ncil zoning, can I sub-divide the back of the land and sell it off, or can I put a granny flat on the back and get additional rental income every week?

Crunch the numbers before you even consider making an offer to the vendor.

ABOUT THE AUTHOR Susan is the CEO and Co-founder of Linzen Group which is a multi-faceted and diverse property development group offering a one stop real estate shop all under one roof. Susan has more than 25 years of successful commercial and financial experience with a background as a registered Chartered Accountant and Real Estate Agent. Her extensive expertise allows her to recognise market trends, demands and conditions to accurately predict project outcomes.

LAUNCH OF DAKABIN CROSSING 134 VILLA AND TERRACE MASTER COMMUNITY TOWNHOUSE DEVELOPMENT

NOW SELLING STAGE 1 OFF PLAN FROM $350,000 3 MINUTES FROM NORTH LAKES

WHY LIVE OR INVEST IN DAKABIN?

1. Dakabin is set to benefit from large-scale infrastructure and economic investment expected to drive its future residential market. 2. Dakabin accommodates all three of the fundamentals that make a sustainable suburb – Population, Infrastructure and Employment. 3. 20 Minutes’ Drive to Brisbane Airport 4. 30 Minutes’ Drive to Brisbane CDB 5. Construction of the Moreton Bay Rail

Link is underway, which will significantly improve public transport in the area 6. Dakabin as a suburb is the clear standout as the next growth suburb in the Moreton Bay region.

WHY LIVE OR INVEST IN THIS NEW DEVELOPMENT?

1. Master plan community of 134 villas and townhouses 2. 2 minute walk to Dakabin train station 3. 3 minutes to North Lakes vibrant business hub 4. Low entry point from $350,000 with low body corporate fees 5. Settlement December 2016 6. Community pool and BBQ area 7. Creational park with walking trails

8. Retail precinct for Coffee and Bakery as well as a convenience store

9. Guarantee rental return for 12 months for all investors 10. Match first home owners grant to use as a massive deposit of $30, 000