The Wentworth Townhouses A recent RDC project
Our client owned a home with pool and tennis court on 1500m2 in Papatoetoe’s Golden Circle. While they held significant equity in the property, their mortgage was still substantial.
Everything needed refurbishing, but the costs would have left the family deep in debt with little capital gain and a mortgage beyond their means. The real value lay in the land itself, not the house, swimming pool and tennis court.
MARKET AND FINANCIAL STRATEGY TO MAXIMISE RETURN WHILE MANAGING RISKS
RDC devised a strategy to divide the completed development into two parts. Of the nine homes to be built on the site, seven would be sold to repay debt and two retained for the client’s own use.
Our analysis indicated that building and selling the seven terrace houses would generate enough revenue to cover all development costs plus what was required for the family to clear their original mortgage.
One of the new larger homes would be the family home. The other would be a rental, generating long term passive income for the family, and capital gains over time.
RDC arranged all finance for the build and off-plan pre-sales of two terrace houses, which secured construction finance and provided an exit for some of their personal debt, reducing the speculative aspect of the project significantly.
As of July 2021, the development is fully sold and nearing completion – on budget and on time.
“I was looking to develop our family property and spoke to a property financial advisor who introduced me to Peter Turner, an experienced real estate professional.
Peter showed me what could be built on the land and the potential financial benefits for my family.
He introduced me to Peter Cotton and other professionals in the RDC team. Together, they established a strategy to carry out the development and arranged finance.
What amazed me was how little I had to put in upfront, thanks to Peter Cotton’s extensive experience and contacts. Peter made it so much easier to obtain the finance to make this project possible and the ongoing support and information he gave me during the process was really professional and personable.
The RDC team introduced a range of property consultants as well as the builder, and professionally managed my family’s project from start to finish, “on budget and on time”. Peter Turner’s constant communication was outstanding.
The result has positively changed my life and my family’s, in terms of property assets, as well as income, especially for my mother who has early on-set Alzheimer’s disease.
I have no hesitation in recommending the RDC team to help you with your project.
It has been a pleasure working with them and they have achieved remarkable results for me and my family.
”
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Note: This case study is provided as an indicative example only. Outcomes are not guaranteed and vary from project to project.
* Around a year on from completion, this client will end up with a manageable loan to cover tax liabilities from profit on sales. The loan will be easily serviced by rental income from the one property being held as a rental investment.