Forum Replies Created
They either want to buy a better property, or want to cash up for whatever reason…other commitments etc…or it's not CF+
THanks Michael,
will check them out..the more conracts the better.
Cheers
SAMGetting close at $492,500
Hi there looking for Guru,
It sounds like a good deal WITH the proviso as you already know that it is cash flow negative for quite awhile.
The lenders will probably only lend you 70% of price or valuation if you’re lucky.
You have probably underestimated the cost of renovations and you will need to be VERY specific about this.
Town Planners, architects (or designers) and engineers are costly and they are more focused on their fees rather than whether you get the specific townplanning outcome you desire, so be careful and be sure you know that the planning outcome is what you want.
Better still make it a condition of the contract.
You have already jumped out of the crowd in terms of competition so you have less competitors for this deal so the vendor may give you time to settle and if you are very certain he may give you permission to renovate before you settle BUT AGAIN be very sure otherwise this is a recipe for disaster and not to be undertaken by the fainthearted.
You will need to have someone manage the accommodation at the end, either on site manager, yourself….real estate agents probably not the right managers.
Personally I would be going for as many conditions (little deposit, long time to settle) as possible and remember also that this project will tie your money up for quite some time…presumably.
Also what is the expected value of the deal when completed as this would have a great bearing on it as far as I’m concerned.
That is probably enough for now..feel free to ring me anytime and good luck with bolting down the facts and figures…you NEED to do THAT!!!
In principle it is a good deal as far as the superficial facts are concerned and one that would have me doing rigorous DD.
Cheers
Byron SAMByron Sam
It will be hard to prove he did not do his job properly but he sounds like a cowboy…definitely serving own interests not the vendors.
Always try to find out what’s going on by incessant phone enquiries or personal attendance to find out facts face to face and be on the spot.
At the risk of sometimes being unpopular.Jupiter Properties P/L buys brick blocks of flats/units anywhere, anytime.
ByronSam
0410473068Originally posted by NATS12:Today I have had an experience which is extremely frustrating. I put an offer on a property in Melbourne. The asking price of this house was $240k+. our first offer was $246k. i didn’t hear from the agent until 8pm tonight and was told the property sold for $251k and I missed out.
I didn’t get a phone call at any stage to up my offer or anything of the like. Considering this was not a set by sale date and just a private sale, I smell a rat. If the agent was acting in the interest of the vendor they would’ve called and asked if I had an increased offer. I was in fact willing to offer into 260-265k however 246k was my starting point.
Any agents or people familiar with doing this day in day out, is this normal practice to get 2 offers in a day and not go back to the underbidder for more.
they never said that offers were to be final and there would be no negotiations.
Does this sound strange to anybody else?
Byron Sam
the best advice for those who have not entered the market yet is to make buying a property their number one priority. And to do it now. That is start from scratch researching the area you’d like to buy in and look at as many properties as you can intensively. Never give up even in a down market because that can be the best time to buy.
There is always someone with the money if you have the knowledge and reliability. Borrowing is usally the easy part.
Byron SamByron Sam
Hi Carlin,
recently I had exactly that experience and had a gut feeling my many offers had not been submitted.
I reported them to the Professional Standards Department (offshoot of the REI)but did not lodge a formal complaint.
I kicked up so much noise and eventually rang the owner direct.
The agents still get their commission of course but I got the property.
It was not my intention to cut them out but I had a very uneasy feeling they were sabotaging the sale AND THEY WERE!!!
Make a lot of noise, approach the owner (if you are prepared to take a slight risk)and do a deal.
I would never have got the block if I had sat back having a terrible feeling in my stomach.
To this day I still don’t know why they behaved like that but the owner is thankful and so am I.Byron SAM
Byron Sam
I agree Karl,
anyone telling us how ethical they are would to me require close scrutiny.Byron SAM
Byron Sam
Hi There,
This is one of the deals I would never even need to do any figures on.
If I bought this sort of deal I would need my head read.
Cheers,
Byron SamByron Sam
Hi Anna,
the first step would be to speak to a townplanner and architect to see what is feasible.
preferably without them charging you at this stage.
The second step if you are VERY confident would be to frame your offer subject to present owner’s giving consent to all the documentation being lodged with Council.
I think you are tackling something a bit complex for the first deal and I have done a lot of them.
The funding for these deals intially comes from your pocket.
It would be very difficult on a site such as this to do it yourself unless you have someone assistance along the way.
Consultants always want money upfront unless you are a regular client and even then they need money for ongoing services.
Also have you done your homework as to the construction costs and work backwards to either the sale of some of the units or the rental factor.
Lenders on construction like to have some fall back in the way of strong security for construction, ability to service the loans and experience with this type of development.
IT seems you do not live locally to the deal which wouldd make it cash flow intensive and difficult to supervise in all details.
My suggestion is to first do the numbers,speak to agents about likely rent returns, vacancy factors etc and then look at your return on investment.
My feeling would be that unless you could get a joint venture partner (after doing all your sums) and then that might not be so easy, at this stage of your development you are taking on a venture that could suck you dry.
Cheers,
Byron SamByron Sam
