Do i keep or do i sell?

[syebba]

Hi,
Would be interested in your opinions.
I purchased 406sq/m plot of land with perfect sea views of Kotor Bay in Feb 07.
It's approx 150m from the waterfront in a small village called Lepetane,just past where the ferries are,u can see the ferries but not hear them,so it,s peacefull.
The plot had 56sq/m of footings laid when i bought it,but after over a year of hassle with architects & planning department i got approval for 110sq/m footings over 3 floors[310 sq/m total build].This would be ideal for 3 large apts or villa.
Water/electric/phone line/access rd are next to plot.
The market is stagnant,a few russians are still buying but the level of transactions has dropped dramatically from last year.
The plot is 5 mins drive from Peter Monks proposed new 750 berth marina & proposed new hotels.
What would you do,sell now if you could,if land was sold at cost price there's about £45k profit due to the weak pound[this inc savings i have in a euro account],or wait until market improves & marina is finished & hope to achieve more in the land sale at a future date?
Anyone know about fixing currencies at a set rate for up to 2 years & the charges for that service?
Sorry this is a bit long!!!
Cheers.

 

[san ference]

To keep or sell

It's really down to to your own personal situation, if you can afford to develop, you have a good location, views and a fair density on your build. Roughly speaking it should cost you around 310K all in (including your land cost) to develop your project. It may sound steep, but by the time you add it all up you won't be far short.

If you have an agreed project with the municipality then you would be crazy to sell it for what you purchased it for as the project has added value already.

There are still investors out there, the main difference is that they are avoiding the agents and mainly buying direct from people like yourself who are concidering off loading their investment.

Looking at your post, you've paid a fair bit for the land if your gain is 45K based the cost v rate. If you wait for the marina to be finshed, you'll be at least another 5 years and thats too long for land.

Where are you in the planning process exactly, past the study of location ?

My advice is this, if you can afford to keep it, do it. If you can afford to get full planning, do it ( don't pay communal tax or water or electricity) , get a construction contract and you have a viable project thats worth at least twice what you paid in todays market, plus your costs, plus appreciation within the next 12 - 18 months or so.

Just remember, you've already done 50% of the hard part

Hope that helps and good luck

 

[syebba]

Hi,
Thanks for your contribution.
With regards to planning i have a location permit for 330sq/m build,i have'nt progressed further.
I would struggle to build all in for 1000e sq/m,as land costs are higher around kotor bay than the Bar/sutomore area.
I did look at a few 600sq/m plots with good sea views just outside of Bar,priced at 50euro sq/m approx,but the plots were about 700 >1000m air distance from the water front.
I have spoken to architechts about taking the project further,but most of them seem to want 25% of the project costs to design & project manage.
I did buy at the peak of the market in feb 07,gazumping was common then!
A large plot in front of me has just come onto the market with SOMEPLACE ELSE estate agents,over 4000sq/m priced at 370esq/m.
I paid 283esq/m in feb 07,maybe that was too much,maybe it was'nt,i don't know!
Ta

 

[san ference]

with a 406sq m plot at a study of location offering 330sq you have about just over an 81% density which is not to tragic. 25% is daylight robbery basically if you bought for 283 you do have a chance but without the architect trying to project manage. If you want to go a bit further, try this

1. Add in a loft conversion to gain an extra 1/2 a floor, this should take you up to an extra 110 floor space, but with only 30% of that being livable. Gives you an extra 33m2 totalling 363 m2 salable (plus a bit extra).

2. Your architect seems a bit of a nob asking for 25% which is way over the price. There's an english guy I know of in Kotor who's got a development nearish to you that could help, both with building quotes at project management.

3. The price you paid is what you paid, the question is what to do. If it helps I've got a spreadsheet that you can fill in the blanks and it will give you the answers.

Final suggestion on this is use the architect for what you can get out of him for free, such as connection costs for water and electricity to be able to add these to your building proposal.

The bottom line I guess is to carry on obtaining as much free information as you can so that it will cut down any developers due dilligence as well as satisfy your own mind to your decision

Don't bank on whats being advertised or what's said, the rule of thumb has always been to knock 30% off the price unless the seller can justify the price.

If you google my name on here you will see our site, click on the contact page and I'm under the UK section if that helps.

Cheers

Nev

 

[syebba]

Hi,
Thats a good idea using the roof space.
The architecht was a nob & taking the mick asking for 25% of project cost.
I have seen a company to the rear of kotor old town who do project management for builds,maybe i'll pop in & have a chat with them.
My basic calculations for size of build was 330sq/m less 20% for walls & stairs etc,leaves 264sq/m saleable space.
Add on your 33m2 for the loft conversion,gives a grand total of 297m2 saleable space.
End of 2007 2500euro's per sq/m was acheivable=742500e approx resale
Nowadays?1800>2000e per sq/m=534600e>594000e approx resale.
I do know some good serbian builders through a friend who won't take the mick on price,the problem i've had is finding a reasonably priced architecht/project manager.
I would'nt mind meeting this other english guy you know,always helpful to see/hear how other people are getting on.
I agree with your point about prices,there's usually quite a difference between the advertised price & the price achieved at sale.
Cheers

 

[Nemanjaned]

Hi member Syebba,

I am really interested what you did with your land. My opinion is that despite you bought it when prices were high at 2007., you made a good trade, that looks like nice peace of land with good perspective.

cheers

 

[coohle]

I'm also curious as to how this story ended. The Tivat marina (Porto Montenegro) is now complete and good locations in its vicinty do have a great potential and your location definitely sounds good (quiet with nice views).