Buying at wholesale

Just finished reading Michael Yardney's book. Some good points there however nothing really new or earth moving IMHO.

One point he discusses is the ability to purchase property at wholesale prices. The way to do this is to purchase an old home on a good block for land value first. Then knock down and re-build.

I remember speaking to Roger F from the Brisbane office a while ago when I purchased my IP up there. He mentioned to me that in some cases owners of a good block of land were willing to sell and re-purchase land with new home for the same price they sold their land for. The point is that it's difficult to compete with companies like Villaworld who can achieve economies of scale via volume. Understand that this is not possible for Villaworld to build in some areas given the land availability.

In any event ... it's interesting to hear others opinions on this point.

But is there really a need to compete with the development companies? If they would make a $300k profit on a development that you would only make a $150k profit, what does it really matter to you? As long as you make a profit.

However, if they start to bring values down by offering a mass of cheaper housing of the same quality, then we have problems.

I am a development virgin, but am keen to devirginate soon. I am thinking of doing Yardney's course as a bit of risk mitigation. Have you done developments before Here_To_Learn? Or are you a virgin too?

I have never completed a real estate development project and also considering attending Michael's course.

I am looking for a new challenge and am very keen on doing my own project hence why I am asking questions and trying to educate myself.

Unfortunately I hear SO MANY HORROR stories when investors try and get their hands dirty on a real estate project. Michael however makes it sounds very simple and I am more than happy to learn from a pro like him.

I contacted him a few months ago to ask him if he know of any other companies providing similar service in Sydney and he said No. Living in Sydney would certainly make undertaking such a project much easier.

Does anyone know how Michael charges for his Project Management service ? Otherwise I will contact him later in the year once I return from China.

I think its 5% of their gross sale amount (eg 1 mill of property all up would be charged 50k) , then you have some profit after that...at least thats what it was 3 years ago.