Sustainable Update Summer 2005

Difficult sloping sites can be built on, and make a profit

Many builders and developers find sloping sites too hard to build on and end up selling them off at a cut price. However Brett McKensie at Sustainable Pty Ltd says all it takes is to start thinking differently. As Brisbane continues to expand the need to work with the land we have increases. Developers need to start working with the orientation of the site, not against it.

If you do have a ‘difficult’ or sloping site start thinking about how to turn it into an inspirational living environment, living 4 – 5m up can be exhilarating! The challenge is to deliver the building cost effectively.

This needs:

Lateral building methods etc etc
Use of technology etc etc
Minimise land contact through clever design and architectural ……etc etc
Minimise site clearing, bulldozing the site is not the answer.
Build with the trees, include them in the design. Clever landscaping and design of the outside space, integrating well with the indoor space, creates a home which is in harmony with the environment.
Focus on helping maintain a sustainable environment through the use of water tanks, energy efficient lighting, water savvy appliances.

As building costs are soaring developers need to look at ways to reduce infrastructure costs by keeping power and water access to one side of the home only, including tanks in the build cost, ensuring swales are used so that waterflow is slowed and water returns to the watertable.

Sustainable Pty Ltd works with developers and builders to create sustainable developments – recently the company completed a residential project focused on the natural environment for the development in the inner city suburb of Bardon.

“The Bardon site was very unique” said Mr McKenzie “through detailed design discussions, we were able to offer the developer the opportunity to subdivide into three blocks and create three innovative, refreshing homes with an integration of the architecture by providing private spaces and shared spaces and that invite people to view city living from a creative new angle.” This development was winner of the 2005 QMBA’s Queensland Low Rise Multi-Residential Housing – up to $1.5 million award.

2. Rising building costs are ‘killing’ many potential residential developments.

Finance broker, Australian Finance Solutions are rejecting around 20% of all new borrowing proposals for residential projects because, once rising construction costs are accurately factored in, the proposals make no financial sense. This problem exists in all three Eastern Seaboard states. It is a difficult message to convey to developer clients, especially given the general slump in development, particularly in NSW.
The issue is now so acute that unless a project can present potential buyers with an exceptional location, or is earmarked for an area in demand as a lifestyle change destination, Austfinance have to decline to generate funds for about one in five projects. In some areas, it is impossible at short notice to engage tradespeople. As a result, delays to get projects completed are commonplace and this further pushes up holding costs.
Also potential buyers of residential dwellings do not want developers to cut corners on quality – in fact, they are demanding that they go the extra distance and provide features and standards that, until the slump, were generally unavailable. Austfinance advise; build and design so that strata fees are low; don’t over exploit the development site and deliver quality of life for the buyer. Buyers – whether owner-occupiers or investors – will be expecting keyless entry, C-bus systems, high quality blinds, top quality fixtures, fittings and appliances. These features should now be basic, rather than optional extras as they once were.
Strata fees have increasingly loomed as a factor in swaying a buying decision. Developers need to build with quality so that maintenance costs are lower.
All is not doom and gloom and on the horizon. At Austfinance we believe the NSW market will not slump any further over the next few months and will begin to pick up from the disastrous vendor tax, towards the second half of 2006.
In the meantime, seachange and lifestyle change destinations will continue to go from strength to strength. Many of these areas, once seen as remote, are now easily linked to mainland capitals with low cost air fares. We do need to consider however, that infrastructure issues will emerge in these regions as populations grow over the next few years.

Baxter Gamble is head of credit for Australian Finance Solutions in Sydney