PROPERTY OFF THE PLAN…….. SETTLEMENT = OVERVALUED!

Hi,

You will find most likely the developer wont negotiate. I bought my current PPOR as a OTP during the property boom in Perth. Some little event called GFC happened between me putting ink on paper and settlement. I would of been down around $50k at settlement and it did continue to fall. There were a number of people who bought a $600k apartment with a $5k deposit. Many had ideas of flipping the property or having value increase so they could get a decent LVR to secure finance. About 20% of people failed to settle due to difficulties in finance or life circumstance changed in the 18 months (marriage breakdowns etc). The developer resold all apartments and where their was a difference in value they took legal action to recover the difference plus additional selling costs. I did hear of one that ended up paying around $100k in costs and they never even got their name on the title.

Depending on how many properties that are all ready for settlement at the same time and assuming the similar drop in value, the valuer may be aware more properties are going to be hitting the market, some with desperate owners wanting to offload their property. I would look at making contact with a broker to assess your borrowing ability and then make contact with the developer to see what options the can offer you, but as I mentioned don’t expect a price reduction. Best outcome maybe they defer settlement for 12 months and rent it to you during this time. Another issue that may come up under this proposal is stamp duty, depending where you are. In WA stamp duty is deferred until settlement or 2 years – which ever occurs first. If they did offer you a delayed settlement you may be hit up for stamp duty during that time.

Regards

Gibbo

NEVER BUY OFF PLAN PROPERTY !!

off plan property involve a lot more due diligence and more skilled to make it profitable !

especially  2 or 3 year settlement…….

sorry to hear your story.
 
if i were you, i would
1) seek for other broker or lender for the finace. ( maybe call Jamie to have a chat)
2) see if you can find someone bought the same development also have the same issue, then you can collectively figure out together such as negotiable with developer, developer vendor finance …..

I hope this helps.

let us know once everything settlement, good luck

Unfortunately most OTP contracts are pretty water tight and aren’t subject to finance approval.

At this stage, you need to keep it simple – I'd start with consulting any of the decent brokers on this forum to see if anything can be done.

Gibbo is right – the OTP contracts don't normally allow provisions for finance approval, it's certainly not in the developers interest to have this.

Cheers

Jamie

first thingis to seek legal advice on if it is possible to terminate the contract or rescind. unlikely but it cold be possible. extremely unlikely that the would be finance clauses or other conditions which have not been met.
econdly talk to a broker and see what you can do.t
hen consider what will happenif yf
ou cannot settle. you will lose your deposit and could be sued for much more.

s

Hi there,
I am planning to built 5 townhouse in 1062 Sqm land front side 26ft lenght 43.3ft each town can built with area of 211 sqm each,is any body can advise what will cost for 5 townhouse construction ??and what will be each townhouse sq meter built up area??

pls send me details
regards
hari
mail id: [email protected]