Validate me this…
Currently engrossed in an e-debate with a friend. He intends “to create a small estate about half an hour from Cork City, spread over 4-5 acres with lush green lawns, speckled with chestnuts & oaks, a small lake and a unique architect designed 3,500 sq ft dwelling with septic tank!” In his Utopian world he will live there for 5+ years and then sell on at a “handsome profit”. His reasons for building
- Purchased land relatively cheap from parents so a relatively small mortgage
- There will never be a cheaper time to build
- High end unique properties are always in demand, and the higher end was/is least affected during the property crash.
Trying to convince him not to build, citing NAMA as dragging out the property crash for many years to come as opposed to letting it naturally bottom out in a fraction of the length of time. Am I correct in my assumption that the Upper End has been more adversely affected than the Lower End? Any available data to validate my view? My opinion is that when this mystical bottom is reached the values will plateau there for a number of years…
Maybe not such a bad idea, considering the end is mutted nigh. He could fill it with heavy pigs and milch cows. Forget the septic tank needs maintenance, go for reed beds and windturbines and a wood pellet burner, if he has got trees he can burn the off cuts while the masses try break in and poach from his pond. If its a home its a home.
Seems like a good idea . He has the land for next to nothing and it really is a good time to build . I know small builders who are putting in silly quotes who have no intention of winning the contract . They are doing it just to keep their name out there . Your mate should get a very good price from a builder who just wants a bit of cashflow and who is competing with phantom bids .
I reckon if he isn’t wildly over extended on the site, and he doesn’t overspend on the build/finish etc (100/sqft max) then he won’t go too far wrong. Spend more on insulation, less on gold-plated cistern handles or mesquite flooring.
This only works if you’ve a ready market of high end buyers who don’t mind not customising so much. I know if it were me, with that kind of money, I’m not buying someone else’s design; I’d be building my own. Worth checking the number of 2 million euro plus properties in Limerick also to be sure about that. Also, I believe the high end market has taken the biggest percentage hit in asking price terms in Dublin. Where there’s a slightly higher availability of high end purchasers.
But that’s the thing isn’t it. He does want to make a profit from it. If he had a cheap site and got a good quote for the building costs and wanted to build his dream family home there would be very little reason not to. But only wants to live in it for 5 years and then sell it for a fortune.
Is he hoping the profit will come from NAMA?
Cos otherwise, there’s going to be no market in 5 years’ time. Particularly for this sort of stuff - I’d imagine people with the readys are involved in Ansbacher No. 2 for some time now, and have no intention of bringing any of their money back home any time soon.