Knockdown Rebuilds or KDR’s as they‘re affectionately known in the industry are projects that as its name suggests, involve knocking down old or existing property and rebuilding a brand new residence in its place.
We’ve been doing them for a while now and recently have noticed a spate of inquiries coming our way requesting quotes and pricing to have clients homes KDR’s so to speak.
Giving it more thought, we asked those who inquired about key drivers as to why they’re looking at a KDR project and were met the typical reasons like:
* Love my street/neighbourhood and don’t want to move
* Moving would put too much strain on the family
* Much more cost-effective than selling and looking for a new place
* We’ve always wanted a brand new home
However, we noticed an emerging trend of clients are looking to increase or better their investment portfolio through a KDR as opposed to buying a secondary property. Whilst this isn’t new to us, Sydney’s burgeoning property market has somewhat prohibited investment decisions as such due to a number of mitigating factors. This trend definitely excites us as we’ve always been keen advocates of KDR’s presenting themselves as a sound investment option in the same vein of buying H&L packages.
Recently, an article from the Hills Shire Times titled “Knock down rebuild projects growing in popularity” certainly backs this notion up. It illustrates how a Baulkham Hills residence capitalised on their recent KDR purchase to the tune of 1.4mil in 6 years. That’s significant capital gains in anyone’s language! “A knockdown rebuild project in Baulkham Hills turned out to be a profitable decision when the home sold for $2.02m — the second highest residential price ever achieved in the suburb.
The four-bedroom property at 24 Hilda Rd looks like a single level residence from street level but has a bonus loft which could be used as a teenagers retreat. Built six years ago and located just off Jasper Rd, the property was inspected by 180 groups during its marketing campaign.
According to CoreLogic RP Data, the level 980 sqm property last sold for $565,000 in May 2011. At the time it had an original bungalow with enclosed veranda on it, which was later demolished.”
So, if you’re sitting on land with a home that you love, but ultimately would like to replace – maybe consider a KDR as not only is it that brand-new home (you’ve always wanted), it’s evident they also serve as an excellent investment opportunity.