Hi,
Just wondering if anyone can offer me some advice on the conditions of a contract as a first home buyer. The home is block rendered with a pool. The electrics have the safety switch installed but looks like the board is full. The home also has a pool so i was going to get an electrical, building, pest and pool inspection. Is there provision in the sale price to negotiate lower for things like upgrading switchboards or structural reinforcement etc., are these general conditions written into the contract that say basically 'if the structure of the house has a major defect we will negotiate the price as per building inspections quotes to repair?'Do I have much bargaining power on a board that is full, I feel we negotiated a good price with the offer but I know the boards going to be updated if we want to add additonal airconditioners, so can we negotiate something like this at contract or basically where it as its not an essential upgrade?
Are there other conditions that people like to add to the contract to protect themselves further that is the norm? any advice is grealy appreciated.
Thanks,
JeffYou can negotiate basically anything and do it a number of ways. You could put down as special conditions all of these and if they come back with problems then you can say you will pull out because of XXX and that is when you can start going backwards and forwards negotiating on price etc. Put finance in there too.
or you could put in a special condition that the vendor repair/replace xx before settlement of $xxx will come off the price. This may be a bit tricky as you will need to arrange finance etc based on the price.
or you could do it all before agreeing on a contract.
Make sure you only let a solicitor draft the special conditions – don't do it yourself or let an agent do it.
Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
http://www.Structuring.com.au
Email MeLawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au
As far as "general contracts" are concerned there is rarely a clause that will say if there is structural damage you get a discount. Because how can you evaluate the effective worth of particular structural damage.
You should get your inspections done before paying your 10% deposit, or create a clause saying 'contract subject to inspection" (get a solicitor to write it up in legal terms.
As far as negotiating power, you have as much as the seller gives you. In a hot market you might try to negotiate and they just tell you to rack off because there are 3 other buyers wanting to pay full price despite the damage. In a slower market with no other buyers around you might have more negotiating power…but it all depends on the vendor.
I agree with terry, get a professional to draft your special conditions
Ryan McLean | On Property
http://onproperty.com.au
Email MeHi Jeff
I've got to agree with Terry and Ryan bacause you'll often find clauses from the Seller, in the Special Conditions area of your Contract, like the following:
"Subject to Section 52A of the Conveyancing Act 1919 and the Regulations under that Act:(a) the purchaser acknowledges that any improvements erected on the property are being sold in their present state of repair, condition, including and defects, latent or patent, or encroachments;
(b) the purchaser further acknowledges that the purchaser buys the property relying on the purchaser's own inspection, knowledge and enquires and that the purchaser does not rely on any warranties or representation made to the purchaser by or on behalf of the vendor; and
(c) the purchaser cannot rescind, make any objection, requisition or claim upon the vendor OR request the vendor to effect any work, repair or treatment or delay completion of this contract on account of any want of repair, incomplete works, or dilapidation or infestation to the improvements erected on the property, or any encroachments by or upon the land or for fair wear and tear occurring between the contract date and completion."
Paul Dobson | Vendor Finance Institute
http://www.vendorfinanceinstitute.com.au
Email Me | Phone MeAn alternative way to finance your home.
hey thanks for your reply guys,
currently awaiting the contract back from the vendors solicitors. The solicitor I am using seems to know her stuff back to front and particularly for the area. Slowly learning all the technical jargon and we put quite a few clauses in there that allows me to walk away if the vendor does not come to the party, I will lose money on my inspections and council searches if I did but being the only buyer interested over 2 months I think I should be ok. The market seems slow and flooded here and much more suited to the buyer, hopefully all goes well.
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