[Webinar] Fundamentals of House & Land, Duplex and Dual Living Opportunities

1. house and land investment

2. Introduction
• builderbuilder provides House and Land and Dual
Occupancy packages
• builderbuilder uses REI online tools to develop
individually researched property deals
• REI members have the opportunity to opt in to
receive the pre-release of our deals via a Property
Investment Brief

3. House Overview
• A purpose built single home on single lot
• Widely accepted by all Town Planning Schemes
• Building regulations are Code Assessable
• Finance up to 95% LVR
• Can be valuations issues if dwelling or lot is too small

4. House Strategy
• Price point $350,000-$550,000
• Yields 4.75%+
• Some equity gain possible during construction
• Entry point for first construction deal
• Important to buy in the right area (in-fill) and estate

5. House Example – Rochedale
QLD
4 bed + Study, 2 bath, DLUG
Package Price:
$949,000
Land Settlement: 06/05/2015
Construction Complete: 04/12/2015
Appraised Value on Completion
$1,200,000 - $1,300,000
(03/2016)
= 26% - 37% Gain
Market Rent: $1,580/wk (8.3% Yield)

6. Dual Living Overview
• A purpose built house with two separate dwellings internally
• Cannot strata
• Town planning limited
• Building regulations same as duplex
• Finance similar to a house but better cashflow up to 95%
LVR
• Valuations issues if too large

7. Dual Living Example Plan

8. Dual Living Strategy
• Price point $475,000-$650,000
• Price 10-20% higher than a house
• Great cashflow with yields 30-40% higher
• Some equity gain possible
• Ideal to increase serviceability in existing portfolio
• Ideal for first home buyers who can rent out secondary
dwelling as an investment property

9. Dual Living Example –
Ipswich QLD
3 bedroom house + attached
2 bedroom dwelling
Land: $180,000
Build: $269,000
Total: $449,000
Market Rent: Appraised at $550-
570pw
Gross Yield: 6.4%
Total dwelling size 200m2

10. Duplex Overview
• Purpose built two dwellings on one property
• Strata title upon completion to obtain 2 dwellings
• Attached or detached
• Higher density zoning required
• Finance up to 90% LVR (half 80% half 90%)
• DA or MCU as of right

11. Duplex Strategy
• Price point $630,000 +
• Advanced strategy for a client who has already done a dual
living or house package
• Strong yields and cashflow
• Flexibility of 2 properties in 1
• Equity release upon strata title

12. Duplex Example – Pimpama
QLD
Attached 2 x 3 bed, 2 bath
single garage
Package Price:
$640,000
Land Settlement:
07/11/2014
Construction Complete: 24/11/2015
Appraised Value on Completion
$720,000 - $760,000
(03/2016)
= 12.5%- 18.8% Gain
Market Rent: $750/wk (5.9% Yield)

13. Key Considerations

14. Key Considerations
• Area
• Capital city versus Regional
• Greenfield versus Infill
• Design
• Valuation
• Builder

15. Area
• Capital City areas are more stable than regional
areas
• According to Core Logic’s Winner and Loser
Report for Dec 2015 the combined capital cities
percentage of losers for houses was 4.7%
compared to 11.3% for combined regional areas
• Due to location of infrastructure and population

16. Area

17. Area – Urban Growth Zone

18. Area – Urban Growth Zone
• Relies on affordability and development of new
infrastructure to drive median price growth
• Median price accelerates in the earlier stages
when infrastructure is being developed
• The ‘myth of over supply’ in master planned
estates
• What was once the urban fringe are now
established areas or infill regions

19. Area - Greenfield
• Relies on existing infrastructure and limited supply
to drive median price growth
• Larger lots are subdivided into smaller lots
surrounding by existing dwellings
• Median price growth varies considerably between
existing suburbs from year to year
• Price points higher than urban fringe

20. Design
• Investment design is all about facilitating
‘rentability’ and then the re-sale to an owner
occupier without over capitalising
• Functional designs with a 2nd living area
• Storage for livability
• Higher ceilings for volume
• Appealing façade

21. Design
Traditional
Investment Property
Owner Occupier
Home

22. Valuations
• Do not overcapitalise for the area
• Why are comparable sales so important and what
do they mean for houses and dual occupancy
dwellings
• Agent market appraisals
• Mortgage valuations and what it means for you

23. Builders
• We only work with reputable builders
• Have proven themselves to be reliable, quality builders
• Have proven in-house construction management
system
• Standard pre-negotiated build contract terms
• 16 to 20 weeks
• Liquidated damages
• Fixed price
• Turnkey

24. Property Strategy

25. Property Cycles
When to Buy

26. H&L Dual Living Duplex
Price $420,000 $475,000 $630,000
LVR 95% 90% 80%
Deposit $21,000 $23,750 $126,00
Rent pw $400 $630
Rental Yield
Equity $30,000 -
$60,000
Approval Period 8-10 weeks 8-10 weeks 12-16 weeks
Strategy Capital Growth Cashflow Equity
Product Comparison

27. Type of Investor
H&L Dual Living Duplex
- Low deposit looking to
get into a deal
- Looking for med to long
term capital gain
- First land and
construction deal
- Low income with minimal
serviceability
- First home buyer to rent
out secondary dwelling to
an investor
- Negative geared property
portfolio
- High income looking for
equity
- Turbo charge portfolio with
2 strata titled properties
- High income needing
deductions
- High borrowing capacity
- High deposit required up
to 20%
- More experienced
property investor who has
done a land and
construction deal
- Looking to recycle deposit
and move onto another
deal on completion

28. property investment brief

29. property
investment brief
Individually tailored
Exclusive property
Pre-release to REI members
who opt in

30. property
investment brief
Clear and concise summary of
the deal giving you a brief
snapshot of key investment
criteria

31. property
investment brief
Land and build information all
in one place for easy reference

32. property
investment brief
Floor plan, site plan and areas

33. Our Guarantees
• Insert screen shots of PIB

34. Expression of Interest (EOI)
• Submit EOI form at back of Property Investment Brief with
$1,000 refundable deposit
• Land and build contracts sent directly to you and your
solicitor
• Land contract subject to 21 days finance
• Build contract subject to settlement of land

35. Next Step…
Thankyou
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