when to sell a development property?

Any advice/comments on how to determine the best time to sell a development property? So some aspects of this might be:

* what's the demand like currently for builders looking for property development opportunities (in particular Brisbane)
* how would one project the development property demand cycle, I was thinking here in relation to the normal demand for residential - would it lead or lag this? or perhaps roughly just be aligned?

thanks

PS. This is a follow on to: http://somersoft.com/forums/showthread.php?t=79302

mixedup said:

Any advice/comments on how to determine the best time to sell a development property? So some aspects of this might be:

* what's the demand like currently for builders looking for property development opportunities (in particular Brisbane)
* how would one project the development property demand cycle, I was thinking here in relation to the normal demand for residential - would it lead or lag this? or perhaps roughly just be aligned?

thanks

PS. This is a follow on to: http://somersoft.com/forums/showthread.php?t=79302

Click to expand...

Would depend on several factors,what area in Brisbane is it in,land zone now and future ,,is the Da in place,imho in Brisbane it comes down too the small area
and what,s happening within that small area,or a simple add in the Sat,s courier mail can also work,both ways..

Best time is, simply put, during a development boom as expected GDVs go up and finance is easier to obtain. These days the banks have no appetite for development, especially in Queensland.

mixedup said:

Any advice/comments on how to determine the best time to sell a development property? So some aspects of this might be:

The best time to sell is when you wouldn't buy it back for the price you sold it for.

* what's the demand like currently for builders looking for property development opportunities (in particular Brisbane)
* how would one project the development property demand cycle, I was thinking here in relation to the normal demand for residential - would it lead or lag this? or perhaps roughly just be aligned?

thanks

PS. This is a follow on to: http://somersoft.com/forums/showthread.php?t=79302

Click to expand...

I have read your other thread about how this property is bleeding your pocket$. Problem is you will need to find someone to take on a similar negative ca$hflow situation that you find yourself in.

If there is no DA, you will have very few prospective buyers. If (from memory of your other thread) this is circa seven or eight kay's from Brisbane CBD, I would think that achieving a sale price of approx 125 K to maybe 150 K per site (depending on the calibre/status of the suburb) may be on the money. Obviously the higher the density it is zoned for, the better in terms of disposal price for you and at least having some appeal to future buyer/developer.

Have you checked with BCC what you can actually achieve there?

You are selling into a tough market albeit not as tough as the Gold/Sunshine Coasts.

mixedup said:

Any advice/comments on how to determine the best time to sell a development property? So some aspects of this might be:

* what's the demand like currently for builders looking for property development opportunities (in particular Brisbane)
* how would one project the development property demand cycle, I was thinking here in relation to the normal demand for residential - would it lead or lag this? or perhaps roughly just be aligned?

thanks

PS. This is a follow on to: http://somersoft.com/forums/showthread.php?t=79302

Click to expand...

Like the others have said, really bad time for Brisbane to do developments, I know from my sources and my own development partners, no one will even consider brisbane at this stage, nor melbourne.. Even North Sydney doesn't hold coin anymore..

thanks for feedback - one thing I'm not clear on in terms of supply/demand here is why there might not be demand from builders in a market where there is not much building occurring - wouldn't builders be still wanted/needing to build to make a living and therefore be keen to find the opportunities?

They do need the work.

It's getting the funding thats the most difficult part, backyard developers where they build few units here and there per year are considered this because to the larger developers where they actually create jobs within there developments are being more favoured over those developers.

So this is the problem where having right now and also the lack of people getting loans to purchase these new properties.

You also have to remember if people are losing there homes and your developing in that area, how will they afford to purchase your new properties?

Same if there close to the city and there in the bracket of $500k+? And your won't get many investors purchasing unless there are some serious returns for that money..

Vicious cycle where in..

It will help to think like a developer if you are selling to them, what margin is there for the developer in the feasibility study?

The DA approved sites done in recent years I have been looking at the sellers are lucky to be getting their money back on the block minus the DA, sometimes there is this issue that the DA hasn't been done well either.

Exactly Andrew. If the concept is wrong and not profitable then your DA is worthless.

ok thanks - I guess I need to get an agent who sells development property to give me a valuation/idea on the property. Any tips on how to get advice from a selling agent that isn't going to be biased towards "sell now" if you know what I mean...Could go to a few agents and their view of valuation with DA & views, making sure I find agents who have a history in selling development property I suppose.

Actually is there a way to get an independent valuation from someone for a DA'ed property? (i.e. I was assuming a normal valuation is going to just look at the house value, whereas what I need is an estimate of what a developer might pay, which hopefully will be more)

Anyone in that split -rebuild game will have their idea of value,it will be different from yours,but ring the site below they may be able to help you,i have not used them for over 2 years,but they seem to have their fingers on the pulse of value
a very fast DA system with a very fast turnaround,


http://www.bartleyburns.com.au/contactus.php