Ipswich Property Investment Case Study: 23 Joffre St, Booval QLD
Another success story for Ipswich Granny Flats …
OVERVIEW :
- Investment property purchased April 2010
- Undulating land to the road
- 809m2 block on the high side of the road
- 30.6.13 Unimproved Capital Value (UCV) of the land $152,500
- Mining Influence on the land
- Character constraint
Photo of house when current owners bought it.
RPData.com
VIDEO DIARY:
DETAILS :
May 2014, the owners of Joffre Street enquired about potentially building a granny flat at the rear of the property.
Was the property suitable to build a granny flat on at the rear of the property? This is usually the first question that a home owner or investor asks. After some initial research – Yes, it was.
These investors had already commenced the process from a finance point of view and thought they had it all under control!
A feasibility proposal was put together and worked through with the clients. Each granny flat project has its own unique features – which is why a cookie cutter approach is not the most sensible way to go. Our own architect designs each building using passive solar designs, site specific per property. Good Granny Flat Design doesn’t have to cost the earth! And getting it right in the beginning makes for cost efficiencies in heating and cooling of the building to name just some of the benefits…
As part of our initial due diligence it became apparent that there was Mining Influence as well as Character Constraint on the block and over the whole area. Whilst this is not insurmountable from a building point of view, it does add several additional costs to the equation.
The Mining Influence necessitates a Geo-Technical Report to ascertain what the foundations would potentially be if a residential building was to be constructed. We would normally allow about $700 for this report. Once it’s established the type of foundations recommended by the engineer, in conjunction with a Soil Test – a firm cost can then be calculated for the foundations.
Once a firm quote was established, financing of the construction loan sorted, approvals in place, all parties then signed building contracts.
And so building commenced…
| TOTAL SPACE: | |
| Granny Flat: | 65m2 |
| Timber Deck/Outdoor Alfresco area under roofline: | 28m2 |
| Single Carport: | 21m2 |
| TOTAL AREA | 114m2 |
| If you look at the numbers: | |
| Purchase Price | $ 268,000 |
| Stamp duty + legals | 8,500 |
| Renovations to existing house | $ 40,000 |
| Total | $ 316,500 |
| @ $280 pw rent = 4.6% rent return | |
| GF build | $ 125,815 |
| Fencing | 5,225 |
| Vegetation removal | 1,500 |
| Project Management Fee | 4,950 |
| Professional Fees & Charges (Approvals) | $ 8,330 |
| Total | $ 145,820 |
| @ $285 pw rent = 10.16% rent return | |
| TOTAL PROPERTY COSTS | $ 462,320 |
| Main house (current rent) | $290pw |
| Granny Flat | $285pw |
| Total rent | $575pw |
| Rent PA | $29,900 |
| = average of 7.38% rent return on $462,320 investment | |
SUMMARY:
All of the above – and built in 30 days!!
Bank struggling to keep up!
And one very happy owner with the progress…
Another success for Vision Property Group (Qld)
