Size matters: duplex, triplex, apartments, single or two story?

The demand for diverse and affordable housing in the Newcastle region brings increased opportunities for investment in multi-unit development. By choosing to sub-divide your block of land and build multiple dwellings you add value to that land. Everyone needs a place to live so building affordable units in a suburb zoned for multi-unit development is a win-win. 

Whether to build a duplex, triplex, townhouses or an apartment block that’s single or double story (or more!), will be determined by a multitude of factors: the size of your block of land, the council regulations, the amount of finance you can secure and most importantly the property development strategy that meets your investment goals. So, if multi-unit development is something you’re keen to pursue, read on.

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Finance and investment strategy go hand in hand

When considering a multi-unit development, a good place to start is to ask yourself what sort of return you want on your investment. You also need to determine your long and short term goals. 

Building with the intention of renting out units will provide rental income to cover the majority, or possibly all, of your outgoing costs. There are also potential tax benefits to renting out units. Various expenses can be claimed from maintenance and property management fees to property depreciation and insurances. Renting out units can be a great long term plan but it is a huge and ongoing responsibility. If you don’t want the commitment of being a landlord then your objective will be to sell all units after construction in order to turn a profit.

Naturally there’s always the middle ground of keeping one unit to rent and then sell the rest. As stated, a tenanted property can often pay for itself. You may even decide to keep one to live in.  Some families also find that building multiple dwellings on their block of land is a great way to enjoy cross-generational living. With grandparents in an adjoining townhouse or duplex it’s a multi-unit development that combines lifestyle and investment.

It’s important to be aware of the process to sub-divide your block of land and secure a separate title for each lot. This extensive and complex procedure precedes the build of your multi-unit development. Involving council, surveyors and solicitors makes it a lengthy procedure to factor into your project timeframe.

Finance: what else to consider

When making an application to finance your multi-unit development remember banks will only fund a proportion of the end value of the project and some may actually want 100 per cent of your multi-unit development sold in advance. Therefore, you need to have contracts locked in before the bank will give you any money.

It’s also important to factor in funds for infrastructure, including surveys, road works, and connecting power to the lot. Generally banks will not lend you the money for these necessities. As with any property development strategy it’s crucial to include a financial buffer.

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How many and what types of units?

First time investors are wise to curb their ambition and start with a modest multi-unit development in order to gain the confidence of their lender. With regard to finance it’s worth noting that a track record of having done any previous development will certainly help secure the necessary funds. By having completed a substantial renovation or a simple subdivision you’ll have some experience to show to your financier.

Across Newcastle there are many large blocks of land zoned as ‘medium density residential’ where building multiple dwellings is not only appropriate but encouraged. Even a block of land in suburbs zoned as ‘low density’ is perfectly suited to smaller developments such as dual occupancy. 

Factors such as council regulations, the size of the block of land,  site orientation and shadowing on neighbouring properties, space for vehicles and the slope of the land will also determine council approval on the height and size of your duplex or townhouses.

There are also plenty of opportunities for the more ambitious new suburb builder. Both new and experienced developers are investing in building multiple dwellings in new housing developments in Newcastle and throughout the Hunter.  

For those who take the time to thoroughly research the market and their chosen area to build as well as enlist the support of an experienced builder, anything’s possible.

Choose an experienced development builder

There are plenty of construction companies who can build your multi-unit development but it’s advantageous to choose one that has years of building experience and is familiar with the relevant council regulations

With over fifty years experience,Valley Homes’ has an established reputation as one of the top construction companies in Newcastle and the Hunter. We are the Newcastle builder to take you through the whole process from planning to completion of the build which is a huge advantage for first time builders as well as experienced developers. For those who already have plans of their own Valley Homes can also assist with pricing your designer’s work. Whether it’s your design or ours, we love creating multi-unit developments that satisfy the dreams and financial goals of our clients.

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Don’t leave the process to chance, choose a builder with solid experience

For all of these reasons, experienced and novice property developers alike choose to work with Valley Homes. Why struggle to manage a project alone when you can take advantage of the expertise of the company that’s been building in Maitland and Hunter Valley for over 50 years? It’s what we love to do. Call us today.