Karen Baldwin – Aberoyle Park, SA
Property Development Graduate
Background
Karen’s project is located in Aberfoyle Park, SA. Her strategy involves demolishing the existing house on the land and splitting it into 4 blocks, each block being 440m2. Karen expects to sell each block of land for $220,000 with a projected total net profit (based on comparable sales in the area) of $213,508.
The Numbers
These costs include the purchase price, stamp duty, holdings, renovations and the relevant adjustments including the selling costs.
| Expenses | Cost |
|---|---|
| Purchase price | $506,000 |
| Stamp Duty | $21,660 |
| Transfer Fee | $3,977 |
| Conveyancing/Legal Cost | $1,200 |
| Development costs | $90,000 |
| Holding cost | $1,750 |
| Total Cost | $624,587 |
| Total Net Profit | $23,145 |
Karen top 3 learning from the property development deal:
- Never underestimate the power of your agent relationships – this was served up to us and negotiations were super easy and quick.
- Be greedy when others are fearful – the agent originally had numerous developers interested, but they all backed out as COVID started to bite.
- Create the product your market wants – we could have built 6 townhouses or divided the land into smaller blocks, but our end buyer is an established buyer and the good size block and wide frontage will be more appealing.
