Investing in a Duplex
A duplex can be built in two configurations…side by side and house behind house. The shape, size and topography of the site usually establishes which configuration is best suited for the duplex development, however there are no rules, so as long as there is some flexibility in the designs and cost, you can build what you want.
Where to Build?
Many developers will look for an area they believe to have sound investment opportunity within an established area. Generally within established areas the initial house will require demolition and the services to the block will need to be upgraded to accommodate two dwellings. Although this adds cost to the development, in many areas, two new dwellings replacing an old house will add value to the overall project. This makes duplex developments attractive for investors that want to build and rent, or possibly live in one and rent one, or alternatively sell the investment for a profit.
Land subdivisions have introduced vacant land with duplex development opportunities over the past few years. With duplex developments becoming more popular as affordability has been challenged, it makes sense for these companies to create opportunities for this type of construction. The cost of purchasing a duplex block in a subdivision is generally a lot cheaper than purchasing in an established area. This will assist in affordability, allowing developers to create product that can be sold or rented on the market at a more economical price.
Improving land by either building two dwellings, or knocking down an existing house and replacing it with two dwellings generally will increase the value of the overall project.
Establishing the outcome of the project before you start is essential to achieving success. As already pointed out, there are several possibilities; sell one and live in one, sell one and rent one, or rent both or sell both.
The design and finish of the house should be considered when establishing the outcomes of the project.
If the outcome is to rent the dwelling, you need to establish who a potential tenant is within this area and what rental income is possible. This will establish how the unit will be designed and to what level of finish the unit is required to have in order to achieve a successful project.
Like renting the dwelling, you will also need to establish what sells in the area and what level of finished is required to obtain the maximum price for the unit. The design and specification of the unit may differ from a unit that was intended for rental.
Living in a duplex home
If one of the duplex units is going to be your personal residence, the design and specification are generally higher than when the unit is going to be rented. Building your own home usually is not looked at the same way as an investment and therefore people are usually prepared to spend more money on the build.
With affordability being an issue for a lot of people, building duplex developments is often the solution. Duplex developments are also a great way for many people to experience their first development or investment venture with minimised risk.
Property investment experts, Ventura iD Duplex Builders can offer advice on building your dream home while starting your investment property portfolio.