Roads to Riches
Roads to riches? Really?
Yes . . there really is more than one road. Not only are there multiple roads to riches, but there’s also rail and light rail and a host of other infrastructure changes coming your way. It seems all levels of government are finally getting their act together to (try to) deliver sustainable places for us all to live.
In each State and Territory, major road upgrades have begun. Some areas have multiple projects, however the list below provides a preview.
- NSW – Westconnex
- Qld – Bruce Highway Upgrade series
- Vic – M80 Ring Road
- SA – North South Corridor and Northern Connector
- WA – Great Northern Highway Upgrade [AND the electric vehicle highway!]
- ACT – Majura Parkway
- NT – Outback Way
- Tas – Midland Highway Upgrade
So why will this lead to riches? There is the obvious (targeted) lowering of traffic congestion, decrease in travel times and increase in safety. The resulting changes will impact employment, and hopefully make life a little easier for those of us who travel for work. The biggest impacts will be felt by property owners and buyers, who will experience significant changes to zoning and property use.
Depending on your perspective, the changes will deliver wins as well as losses. Managed carefully, you can turn your lemons into a lemonade stream. Whether you own a property or considering a purchase, outlined below are some tips for managing the change.
- Confirm the zoning – visit your Council website or call them directly to obtain confirmation of the zoning and new use of the property.
- Obtain details of the infrastructure change – contact the authority (ie – Roads Authority or State Government) responsible and obtain maps, reports and feasibility studies. Subscribe to updates and participate in any available information sessions.
- Consider all options – and we mean all Brainstorm at least 10 different avenues – there is bound to be many more so don’t stop if you can list more than 10.
- Consider stages – at least three but again there could be more. At a minimum, consider the present stage (usually prior to building), during (while the road is being built – eg – noise, dust, trucks, tradies drying their clothes on your lawn . .don’t laugh . .this has happened to me), and post (after the new road is operating). There will be pros and cons for each stage.
- Talk to your neighbours (residents if you’re purchasing) and local businesses – pro-active and professional real estate agents can be a great source of information (just don’t rely on them as your only source).
- Obtain an independent valuation (don’t use the government valuer) and remember property value will be different for each stage of the project. Also collect details on recent sales, so you have a benchmark as a reference. It may also be worthwhile commissioning a building report, to ensure you have a record of your property’s condition prior to works commencing.
After you have gathered your information, it will be time for a drink . . .sorry, I meant think . . . but you also can do both. Then consider your choices including the following.
- Retain and renovate – if the new road means the city is coming to you, it may be worthwhile renovating to ensure your property remains attractive against the other properties in your area.
- Retain and develop – numerous options here. If the property has been rezoned to a higher density level, there may be an opportunity for a duplex, townhouses, units or commercial uses. It may be viable to retain some (or all) the developed properties and provide an opportunity to live off the rent . . hello lemonade stream.
- Sell to the government – if you have received one of those fabulous letters advising the government is keen on your property, don’t panic. Depending on your skill level, it may be best to appoint an experienced negotiator to act on your behalf to plan the next steps. There is an extensive amount of information available to help you consider all variables, so ensure you invest time in quality due diligence. In general, the government will be quite reasonable to deal with as there are well established guidelines around rights and responsibilities during property acquisitions.
- Combine with neighbours – this is a good strategy if your property has been zoned to a higher density but your land area is on the small side. Once again, get experienced advice, but you may find your property is actually worth more when combined with your neighbour’s property.
- Buy out your neighbours – the alternative to the previous point . . .buy out your neighbours and either develop the properties yourself or package them up for a future developer. Note that you can do this over a period of time so your neighbours won’t have to move out immediately. They may be happy to remain in the property until the infrastructure project is finished or their children finish school. Good communication and documentation are essential.
- Rent out – often overlooked but can be a great cashflow option. Talk to your broker or financial advisor, but you may be able to refinance to purchase another property and still rent out your existing property. Actioned correctly, this is another option for the lemonade stream.
If you have lived in an area for many years and suddenly it feels like your world is changing, it can be extremely confronting. However, with any downside there is always an upside so you have the opportunity to get busy finding your optimum solution. You never know, you may find your road to riches actually starts in your backyard.
Author: Debra Beck-Mewing
Debra Beck-Mewing is the Founder and CEO of The Property Frontline. She has more than 20 years' experience in buying property Australia-wide, and is skilled in helping buyers use a range of strategies including renovating, granny flats, sub-division and development. Debra is experienced in identifying tailored opportunities, homes and sourcing properties that have multiple uses. She is a Qualified Property Investment Advisor, licensed real estate agent and also holds a Bachelor of Commerce and Master of Business. As a passionate advocate for increasing transparency in the property and wealth industries, Debra is a popular speaker on these topics. She is also an author, podcast host, Editor in Chief of Property Portfolio Magazine and participates on numerous committees including the Property Owners' Association.
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Disclaimer – This information is of a general nature only and does not constitute professional advice. We strongly recommend you seek your own professional advice in relation to your particular circumstances.