My husband and I bought a suburban acreage (Mount Hutton, Newcastle, NSW) a year and a bit ago for $580k. A property development company has just offered us a two year option agreement for $915K for 6025m2 and we get to keep the house on 800m2.
We have agreed on a $1K deposit, $9K deposit after 90 days due diligence and $10K after a year.
It has the correct zoning for medium density housing and precedence surrounding it.
We are about to sign a heads of agreement. We haven't looked for any other offers because I thought this was good and the development behind us is due to commence shortly which we would need to buy an easement through for storm water and sewer so time is of the essence.
Does anyone know much about this kind of thing that could offer advice for us? Any help would be appreciated.
As a developer, I am probably biased, but that sounds great from your perspective. You get to pay off your mortgage,have more cash in the bank and keep the house.
Just check that the deposit is non-refundable. Some of the options strategy gurus advise their students to offer deposits that are fully refundable if they don't proceed.
Obviously get an experienced property lawyer to look over the contract before you sign as well.
When you say "we would need to buy an easement through for storm water and sewer so time is of the essence", is it literally you that has to pay for this easement, or is the developer paying for it? It would be unusual to expect you to purchase the easement for someone else's development.
Get some legal advice before accepting.
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
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