The Exciting Journey into the Centre of a House & Land Build Investment

How you can secure your future and watch your dreams grow...

When it came to investing in property, I was always a little nervous about buying new. I always believed that pre-existing was better - stronger foundations and a better quality build from the days of yore. This belief had been pretty much cemented from seeing some of the shoddy construction work in Sydney in the 1990s.

It wasn’t until I worked in the property space that I realised the value of purchasing a new house and land package:

• Stamp duty payable on the land only for a two-part contract, providing substantial savings
• Full tax depreciation, for savings of thousands of dollars
• Higher rental income possibility - renters pay more for new
• High demand option - renters prefer new homes and seek these out over existing builds
• Warranties and guarantees only available to new builds
• New homes are subject to new zoning rules that take into account flood and fire, posing less risk than those built prior to implementation of local council regulations.

Having seen a number of exciting options, it was easy to make a choice last year, in 2020. The market was thriving and rapidly gaining momentum, following our first experience of being locked down. My own experience has been the very same process that my clients go through, so you know that I truly understand what it’s like to stand in your shoes.

Selecting a New Investment Property

I had already been recommending properties in Pimpama to my clients, and I also wanted to get in on this market.

Pimpama was a logical choice - 30 minutes from the Gold Coast CBD it was a highly desirable location for owner-occupiers and renters. I was aware that land was running out across the Gold Coast, and I knew this scarcity would also push up the value.

This particular estate, The Heights, is a luxury estate developed by The Sunland Group. It’s a quality estate with curated grounds, and handy to infrastructure and transport.

The Heights is adjacent to the new multi-million dollar Sporting and Aquatics hub; Coomera Westfield is just five minutes away by car, and the new Coomera Marina only 10 minutes’ drive.

Pimpama is an established area, and so schools, sporting facilities, restaurants and other stores are located all within just minutes from the precinct.

Making the Purchase

After confirming our borrowing capacity, an EOI was submitted with a $1,000 hold fee securing the property.

The lending process was quite invasive because my husband and I are self-employed. Every minutiae within operations was investigated and scrutinised. And then on a personal level I closed down a credit card account to help increase our borrowing capacity. Lending is always a challenge but because I have a very good broker we knew how to get the deal across the line.

Once contracts were reviewed and signed, our funding was approved - following a valuation on 31 March 2021. At this point, a 10% deposit was paid on the package and plans were sent to Council for building approval.

The loan repayments started from this point. Known as holding costs, these are factored in during the finance process. While I don’t particularly like paying out of pocket during construction, it’s reassuring to know that these funds contribute to the repayment of the loan anyway, as opposed to simply having to pay thousands more in stamp duty for an existing build. You can structure it as an interest only loan which minimises these costs.

STAGE 1 – Base Stage (6 weeks from Finance Approval)

Stage 1, Base Stage is when the foundations are laid, and the site is prepared to have the slab poured. The plumbing pipework is also laid, as they sit beneath the slab.

It was terrific to get the email that showed this first step done. I wasn’t even aware that the building approval had been accepted, and so receiving these photos just 6 weeks later was a pleasant surprise.

I received several photos in this email, along with the invoice for the first stage of the build. My vacant lot now had cement laid down. I was so excited at the thought of construction having started with the all-important base in place. We were on our way...

STAGE 2 – Frame (3 weeks)

Only three weeks later, the next email arrived… the frame had been erected! The frame, as the name suggests, shows the property taking shape. From the images received I could make out the fa?ade, and the bones of the home were in place.

The frame can be built from timber, SIPS panels (structured insulated panel systems), or steel. Critical for frame stage are any niches that may need to be framed out, such as a recessed vanity mirror or shower niche. Any built-in pelmets that you want for your blinds and curtains need to be framed out too, and anything else that affects the frame or structure should be built at this time.

This particular builder has a lifetime structural guarantee so this stage really provides a strong skeleton for our build.

STAGE 3 – Enclose or Lockup (9 weeks)

This is a large part of the actual build, where everything is being prepared before the plaster is installed.

External cladding is on, and windows and doors are installed. The garage door is also in place. The basic lines for electrical cabling, plumbing, pipes (including gas connection), heating ducts, and cooling are all laid.

This stage takes time, as so much work goes into it. Now my building frame had form, and I could barely contain my excitement as I watched it near completion.

STAGE 4 – Fixout (2 days)

Fixing stage is where all the internal cladding (such as plaster), cabinetry, insulation, doors, skirtings, architraves, waterproofing for wet areas and tiling are all installed.

Given how quickly the photo updates were sent through, it’s apparent that this stage overlapped with the Enclose Stage. Typically Stages 3 and 4 would be weeks apart.?At this point, my house was starting to look like the homes I saw in the brochures and during my tour of the estate back in February 2021.

At this point I contacted a specialist to arrange my depreciation schedule and received my report for tax purposes.

I also contacted the Property Management Team I would be using to let them know the project was near completion so we could gear up for advertising the property for rent.

STAGE 5 - Practical Completion

There was a sense of excitement and relief that came with seeing my property completed. All the finishes are in place and the result was a fresh, open and clean looking build that was in keeping with the covenant that makes this estate a stand-out.

I arranged for an inspection. One was already provided by the builder - a non-biased third party. However, through a property manager I know I arranged my own inspection for a minimal fee. They picked up on just the most minor of things; mainly the clean up of a bit of paint, sealant and a tiny bit of missing grout but that's what I love about these inspections. You can have a good tidy up and get the property looking perfect!

At the same time I arranged my insurances and got them in place ready for handover and received my Certificate of Occupancy. So all was ready to advertise for a tenant.

My Property Manager arranged to have a photographer on site during the inspection to take photos and video which would be used in our advertised listing.

Handover (1-2 weeks)

This is the stage we are at now. Minor defects have been fixed and the bank did their own inspection before releasing funds for the last payment.

In the meantime, my ad generated 12 applications and a tenant was secured in 10 days -?in which time they were approved, signed and paid their deposit.

This is the value of a good property manager. I secured a rent that was 12% above the advertised brochure rate - an additional $60 per week!

Now all we are waiting on is the handover of the keys.

WHY IT'S WORTH IT!

A number of people fear the time it takes to do a new build and some are actually misinformed. Having gone through the process during the largest lockdown period in 2021, and at a time where materials and labour are scarce, my build took 7 months! That is only one to two months longer than the usual timeframe, prior to these limiting market conditions.

I put one of the builder's we work with to the test and they delivered a quality home, uncompromised, despite these challenges. They have the financial backing, the team and the resources to simply get it done. In fact, the builders we work with are all of that calibre and that makes a huge difference.

This property I built is in a highly sought-after location, which is why I also recommended it to my clients. I know this investment will bring positive returns and long-term financial gain and the rental values have already gone up from the time we purchased it,not to mention it's value. A client who made a purchase in that same precinct saw a valuation increase of $31,000 from December 2020 to March 2021.

Further to that you will notice rent was estimated at $460-$490 per week. And as I expected we surpassed that. The rent my Property Management Company was able to secure for this 4 bedroom home is $550 per week.

And this is the outcome I seek for each of my clients. This journey, particularly with all the obstacles, has been a very rewarding one and I look forward to providing the same thrill and financial security for everyone who walks through my door.

Selecting the NEXT Investment Hotspot*

New house and land packages in Pimpama are now exhausted. So what's the new location to invest in? Honestly, there are a few wonderful markets right now and it's hard to go wrong when most markets are in the growth phase.

At the moment South-East Queensland remains strong - Ipswich, Logan, Moreton Bay are excellent performers as interstate migration continues and the 2032 Olympic announcement has ensured ongoing growth for another 10 years.

Toowoomba is another location I am partial to, but investors should move quickly. I found a lot of people asked about Pimpama after the fact (ie once they saw it as a safe investment, and by then prices jumped over $100K+ what it cost literally months earlier). Toowoomba is at the start of the growth phase and the sooner investors latch on, the more they stand to make. Toowoomba is thriving on its own merits with infrastructure spend, jobs growth and subsequently population growth, making it the next strong location for not only capital growth but positive cashflow. Low vacancy rates are driving rents up so the numbers really stack up in this fabulous regional city.

*conditions apply

I can help you not only from my experience but the amazing team I have working for me and my clients.

Let's build wealth and financial independence together.

CALL Maria on

0417 471 031