In this article, I will share 6 things that I wish I had known before I undertook my first townhouse development project here in Melbourne.

So, if you are considering doing a dual occupancy build or townhouse build yourself, keep reading.

As townhouse developers undertake townhouse development projects, whether here in Melbourne or anywhere else, there are many moving parts.

The learning curve is steep if you are new to the game. That is for sure.

I aim to fast-track your knowledge by sharing some of the most valuable lessons I’ve learned over many projects.

Before we get into it I want to point out the importance of understanding townhouse designs and prices – so the costs involved to build. For now, let’s move on.

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1. Using Builder Square Meters Rates as a Metric

The first thing I want to talk about is duplex builder square meter rates.

builder square metre rates

While these square meter rates can be handy to lean on in specific scenarios, they can be seriously unreliable and potentially give you a bum steer.

The issue is that they become somewhat distorted depending on the project’s size.

When you have two projects with the same number of bedrooms and bathrooms, yet they are significantly different in size, this is when it can become problematic.

If you think about it, many of the more significant expenses will be in wet areas.

This is where the fixtures, fittings and finishes cost the most. On the other hand, the size of bedrooms and living rooms cost less.

Ultimately, the smaller dwelling still has the same amount of kitchen and bathrooms and relevant costs, so assuming that all square meters are the same cost is flawed.

The fact is, figuring out a construction budget isn’t as simple as multiplying the number of squares by your budget per square.

You must support your numbers with knowledge and experience.

2. Hitching the Wagon of One Project to Another

One of the earliest and most important lessons I learned developing townhouses in Melbourne was never hitching one project’s wagon to another.

Don’t start making moves on project number two if you haven’t 100% completed project number one. It’s just too risky.

Unless of course you have the money to fund both concurrently if both don’t go to plan.

These townhouse projects almost always cost more and take longer.

Making big decisions on top of assuming that your project will be completed by a specific time is extremely risky.

There is an old saying which I think rings true.

If you get greedy, you get caught.

So don’t let your eyes get too big, be patient and keep your risk to a minimum and avoid hitching the wagon of one project to another at all costs.

It’s just not worth the risk.

3. Understanding How Difficult it Is to Find a Good Site

I say this all the time. Just because you can develop a site doesn’t mean you should.

These townhouse development sites in Melbourne can be like finding a needle in a haystack.

The number of sites I look at and discard to find a feasible site is genuinely mind-blowing.

Don’t make the fatal assumption that just because a site can be developed it should be.

Getting your site selection incorrect is the fastest way to lose your money. So make sure you do detailed research and get the right advice and help where required.

Nailing your due-diligence and feasibilities is going to be critical.

4. Knowing What You Can Achieve on a Site

It’s not uncommon when starting out doing these townhouse development projects that you get this wrong. In fact it’s more common than not.

What you thought you would achieve and what you actually achieved can be starkly different, which can be a massive real estate development risk for apparent reasons.

Getting this right with any level of consistency takes a lot of experience.

Here at Little Fish, we put a lot of value on this. As such, we sink a lot of time and resources into improving. It’s something we are always refining and working on.

5. Effort Required to Sell Property Off the Plan for a Premium

This is an area we definitely undervalued in the beginning. To get this right, you must decide if you are selling your townhouses vs. holding early.

Not anymore. This is an area we have put significant time and resources into over our journey.

Finding ways to give potential buyers the confidence they need to act is an art form in itself. It’s another area we are always looking to improve and evolve.

There is no question we have seen a significant increase in our of the plan sale results as a direct result of the investment we’ve made in this area.

And the little things matter: attention to detail and being prepared to do what others either can’t or aren’t prepared to.

6. Greater Appreciation of Time

Time is one of your biggest enemies when undertaking a townhouse development project.

It’s no secret that time costs money, and, in many cases, a lot of money, so you need to be all over it.

Assuming that your contractors and providers are working on your project in a timely manner can be costly.

Especially when you are starting out.

From experience, I can assure you that you won’t be sitting on top of your contractor’s pile, and you can expect to pay a premium for their services – mainly if your project is a one-off.

Becoming a priority for your contractors can take years.

In many cases, the strength of these relationships can be the difference between whether a project is viable or not.

So put time and effort into building and nurturing strong relationships because they will pay dividends for a long time if you do.

As a couple of final tips, I would say never stop learning, for example – don’t just get a shadow analysis done. Put time into learning the overshadowing regulations.

Same as your house slab – learn about the different types of concrete slabs and things such as minimum slab thickness requirements.

If you do the work, it will pay off! Before we wrap up, as a bonus, check out these tips for managing your council when undertaking a townhouse development project.

Wrapping Up

townhouse development melbourne

Need help? Are you keen to undertake a side by side dual occupancy or townhouse development? You can check out this townhouse development case study to get you going.

Also, don’t hesitate to contact our expert team of consultants to discuss our property development management services.

We would love to hear from you 1300 799 277.