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Viewing 20 posts - 81 through 100 (of 123 total)
  • Profile photo of colinnewlandcolinnewland
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    @colinnewland
    Join Date: 2006
    Post Count: 128

    Go for delayed settlement on one property.
    Get immediate access to both properties to allow you to complete the renos ASAP.
    The tenant woul dbe entitled to FREE rent (cheap at 1/2 the price as you will add $1,000s to your valuations.
    Have the valuations completed WITH the renos taken into account; you will need 3 quotes for each item (painting, carpets etc) so as to allow the banks valuer to increase the valuations.  Remember, 'some' renos ill not add $1 for $1 but just a % of the money you spend.
    What is the selling motivation of the seller? Does he need cash NOW/YESTERDAY to complete another purchase or to remove his mortgage? If its to remove all or a % of a mortgage, offer to use a 'Rent to Buy option' where you pay his entire mortgage for him….this allows you to hold onto your deposit (for now) while paying is mortgage for him while you complete the work and at least delays the cost of stamp duty. 

    Profile photo of colinnewlandcolinnewland
    Participant
    @colinnewland
    Join Date: 2006
    Post Count: 128

    Try spliting them into different Trusts. Go to several different banks, one for each Trust; each of them using you as a guarantor. As you do not (yet) have a liquidated debt, you can act as the guarantor.This will also allow you to borrow much more in the long run.

    Profile photo of colinnewlandcolinnewland
    Participant
    @colinnewland
    Join Date: 2006
    Post Count: 128
    Profile photo of colinnewlandcolinnewland
    Participant
    @colinnewland
    Join Date: 2006
    Post Count: 128

    I assume you have not made contact with the selling agent?
    As regards the agent getting his fees, that would also depend on when his contracct ceases (usually no more than 3 months).
    A corner block 'usually' gets an additional 5% space allowance in regards to block size: ie: an 1,160 sm site with a min 400sm building size (just 2 x blocks) could get an additional 5% (+58sm) = 1,218 = (3 x 400+sm) allowing you to build the 3 you need.
    Visit the town planning department and put your plan to them….they are usually forthright.
    As for submitting a DA, the planning department does not 'usually' require detailed plans: you can do your best effort yourself; with detailed plans to follow.  All they need are a representation of the block and the boundaries plus the suggested building locations.
    Do a title search yourself, estimated cost is about $70…this will have the address of the owner if its different to the street address.
    Send a confidential letter to either the stree address and the discovered owners home address, seeking a private meeting with a view to buying.
    You could also look at going into partneship with him to build the 3 units. It works like this;
    1. You get an option to purchase at a set price (say $800K [as it will take several months-12+ to complete so an extra $50K/6.6%
    and no 20% deposit required on your side plus no transfer taxes as its not 'yet' been sold/transfered.
    2. You get a licence to occupy the land with authority to build.
    3. Get a valuation set at the date of completion on all 3 units.
    4. You fund the building of the units via a bank loan. NOTE: If you pre-sell just 2 of the units, the banks will usually fund the entire project.
    5. Sell all 3 units by transfering the option to purchase to the end buyer; they pay the state stamp duty, not you.
    6. You then slpit the profits (after deducting the $800K for the land and building costs, including interest, fees etc) or you take one unit [to hold, rent etc] as your profit.
    By using an option, you will save yourself ~$40K in stamp duty/lost income/lost profits and not have to tie up at least $160K in a deposit~you can use that same money as your building fund/deposit with the banks covering the remainder [up to 100% if you manage to pre-sell at least 2 units during the months it will take to get council final approvals, find a builder etc.
    As a base line, with a land content of $800K/3 = $266K each (1/3rd of the land+building valuation) plus 2/3rds in building valuation ($533K) = a selling price of ~$800K each x 3 = $2.4mil. Does $800K each for house and land seem right for this type of area on a ~400sm block?

    Profile photo of colinnewlandcolinnewland
    Participant
    @colinnewland
    Join Date: 2006
    Post Count: 128

    STOP: How did the fire start? I would suspect a naked flame (a candle). Wait for the fire department report. If it was started by the tenant, then they are liable to pay for all damages NOW. Do NOT wait to take it from their bond as there may be additional damages/unpaid rent/cleaning to do at the end of the tenancy.
    If they refuse to pay, terminate the lease immediately after issuing a breach notice in writing via registered mail.
    Do not be affraid of a gap in your lease payments as your rental insurance will pay for a rental period (usually up to 12 months) should 'deliberate' damage of more than $1,000 be sustained. You can argue that a naked flame is: A) a breach of their lease; B) deliberate damage as it was lite by the renter and they neglected to properly manage a dangerous item, knowing that a naked flame can and will cause substancial damage.
    At the very least, the renters will be responsible for any and all insurance excess.
    Do NOT let your agent talk you into just using your insurance policy and for you to take any insurance hit…it means that they are not prepared to follow thru on recovering your loss from the renters.  It means less work on their part.
    The agent is also the ones that should submit the claim (if required) with the insurance coy but keep on their wheel with them submitting copies of all documents to you BEFORE they submit them; you may be stuck with wrong info if they get it wrong.
    You will however be under a legal obligation to fix the damage ASAP (yesterday).  If you fail to do that, the renters will be able to claim a reduction in rent (up to 100% in some cases) until trhe damage is fixed, even if they caused the damage in the first place.
    You should also be aware that there WILL be smoke damage to ALL the paint work thru-out the entire house, in the carpets etc. Your entire house will need repainting and ALL the carpets will/may need 100% replacement as the smoke damage will have penertrated deep into the carpet (and will not be able to be removed, even if they are steamed cleaned [paid for by the renters/insurance coy]) or if the carpets cannot be colour matched (due to not being available or if the carpets are so old that they cannot be colour matched due to wear and tear and sun damage.

    Profile photo of colinnewlandcolinnewland
    Participant
    @colinnewland
    Join Date: 2006
    Post Count: 128

    You can write up your offer in the following term: …this offer is open until date/time OR a shorter period should I recieve acceptance for any other offer.
    This allows you to submit several offers at the same time with the confidence that you will only be obliged to settle on the first offer accepted. Make sure that you also include the Date AND Time of acceptance in your written offer.
    Just to make sure, you also withdraw all other offers via email before you recieve any other acptenaces: you do this at the same instance you get your first (and now only) acceptenace.
    It also puts a 'little' pressure on the seller to make a decision.
    Never be put off by any agent suggesting or refucing to immediately submit a written offer to the seller. They may 'suggest' that they will not be able to submit the offer until after normal work hours to the seller….thats BS in todays mobile phone/TXT/email world. If the agent does dont have immediate access to a seller I would be surprised.
    You may also like to confirm with the agent as to how and when he will communicate with the seller.  You may suggest that he phone the seller in your presence.

    Profile photo of colinnewlandcolinnewland
    Participant
    @colinnewland
    Join Date: 2006
    Post Count: 128

    You are paying the conveyancer so get them to do their job or find another who will…making sure you take the origional of any work they have already completed on your behalf (title searches, council rates and building permits etc).
    Get early ACCESS if possible as a 1/2way point, this allows you to measure up for reno etc and to have contractors in to measure up….saving you heaps of time; ready to start the same day you eventually get the keys to the property.

    Profile photo of colinnewlandcolinnewland
    Participant
    @colinnewland
    Join Date: 2006
    Post Count: 128

    Asking a silly question? Why do you want to rid yourself of a cash generator?
    Are you looking to retire or to move onto other projects?
    If you need cash for additional projects, why not borrow against the equity you have built up to 'x'ly your IP projects?
    Failing that, if you still want to sell up and get out, why not borrow, use the equity while you wait for a buyer…it sounds like this will be a narrow market and will take some time to sell?

    Profile photo of colinnewlandcolinnewland
    Participant
    @colinnewland
    Join Date: 2006
    Post Count: 128

    Who gets the income from the power generated by the solar panels?
     Each unit may use different amounts of power; will they pay via seperate meters?…will the excess income go into the BC funds?
    Whos going to pay for the yearly cleaning of the water tanks?
    Whos going to foot the additional repair and maintenance bills in the future? This has to be factured in NOW with a sunking fund established to cover future costs.

    Profile photo of colinnewlandcolinnewland
    Participant
    @colinnewland
    Join Date: 2006
    Post Count: 128

    It is usual that owners only 'own' the inside of the property (excluding the roof space. IE They only won and control from the first layer of paint inwards.
    If you are worried about unlimited liability, I suggest that you convert the BC to a company with limited liability with each unit owner having a licence or share with the right to exclusvely occupy a nominated unit (with they can transfer).

    Profile photo of colinnewlandcolinnewland
    Participant
    @colinnewland
    Join Date: 2006
    Post Count: 128

    I suggest that you also get a power of attorny to sell the property as well as the option. This allows you to deal with the property (sell) as you see fit.

    Profile photo of colinnewlandcolinnewland
    Participant
    @colinnewland
    Join Date: 2006
    Post Count: 128

    Are you looking to just value the property with the improvements or as a business as a going concern (with its attached cash flow)? This will have a major influence on the valuation.

    Profile photo of colinnewlandcolinnewland
    Participant
    @colinnewland
    Join Date: 2006
    Post Count: 128

    Whos name is on the lease?If its just your name, you 'may' have a small amount of leverage by;
    a. Locking out the other partners from the leased property and
    b. Selling the lease to a 3rd party (if the lease allows for this and the owner agrees).
    You can force the termination of the partnership but this will require some court help…unless you can negociate a sale with the remaining 2 partners.
    As long as you remain as a partner, you remain 100% liable for ALL the debts the partnership incurs, even after you no longer have any day to day management! READ THIS AGAIN.
    My strongest advice is to get a lawyer ASAP.

    Profile photo of colinnewlandcolinnewland
    Participant
    @colinnewland
    Join Date: 2006
    Post Count: 128

    Try the following:
    Start the new job abd getthe $500 a week into her pocket.
    Do NOT sign over the $70 loan or walk away from it.
    See what the partnership agreement has to say about how to end the partnership.
    Have the partnership valued; you may find that the value has already dropped.
    Remind the remaining 40% + 20% partners that their share of profits will increase once she rrtires from the partnership.
    Offer to sell your 40% to the guy with just 20% and give him the controling interest.
    Apply to the District Court to wind up the partnership.

    Profile photo of colinnewlandcolinnewland
    Participant
    @colinnewland
    Join Date: 2006
    Post Count: 128

    Is rendering really necessary (at ~$10K+) or would a good spray paint have the same effect (~$1K if you do it yourself, with hiring the spray unit and paint)?

    Profile photo of colinnewlandcolinnewland
    Participant
    @colinnewland
    Join Date: 2006
    Post Count: 128

    Tamster74,
    Drop me a line and let me know what you think about the program.  [email protected]

    Profile photo of colinnewlandcolinnewland
    Participant
    @colinnewland
    Join Date: 2006
    Post Count: 128

    To get a tenant out of a house, you would normally pay their removal costs.  You may wish to sweaten the deal by paying their rent for the same period of time they woul dhave stayed in your IP (as a last resort).  Go speak to them, they may already have found another place and are worried about having to pay 2 x rental to hold their new rental.

    Profile photo of colinnewlandcolinnewland
    Participant
    @colinnewland
    Join Date: 2006
    Post Count: 128

    You will need o check to see if you own the property as 'Joint Tenanats (with a set %)' or as 'Tenants in Common' with a common interest, no matter what funds were included.
    I am not sure if NSW will allow you to change from one to the other at a cost to you. If your moving from TinC to JT (with a stated %) this should be quire easy.
    As you are not transfering the property to a 3rd party, I wuld suspect that you will not be charged, other than some admin costs.

    Profile photo of colinnewlandcolinnewland
    Participant
    @colinnewland
    Join Date: 2006
    Post Count: 128

    Pay off the car loan ASAP (monthly) and save yourself the additional 5+% interest payments.
    Put the $20K into an offset account with your home loan to get a tax free benefit at the rate of your house loan.
    See if you can add value over the next 6 months to the house (repaint, pation, etc).
    Have it revalued in 6 months after all the renos done.
    Save like hell in the same 6 months.
    Use the 6 months to find IP in the area of $200-250K; something that needs reno so you can add value.  Make sure the new IP is valued as at AFTER the reno has been completed; its on this figure that the bank will 'usually' loan 80% (without mortgage insurance) against.  THis way, the bank is effectively financing the reno as well.
    Dont stress it, you seem to be doing fine….your monthly income is far lager than most.

    Profile photo of colinnewlandcolinnewland
    Participant
    @colinnewland
    Join Date: 2006
    Post Count: 128

    Unless there is a specific clause in the BC rules, politely refuse.
    I would also send the letter to the tenant asking the tenant to pay for the costs incurred. (Thing about including this in your next lease as a special clause).
    As for the offending flatmate, does your tenant have your written permission to have flatemates within your lease? NEVER allow any person to stay in a rental unless they are rigistered on the lease, no matter what. This gives you more power of their behaviour and several sources of income if one defaults on rent. It also ensures that every person in the flat has had a rental check completed on them by the agent. It also ensures that every person in the flat has a committment to abiding by the rules and ensuring that the flat stays clean…as the other party will be left with the bills if one does not do the right thing.
    If not, advise the tenant that the flatmate has to go within 7 days.
    I would do this via registered letter with a breach notice a away of correcting the breach(s).

Viewing 20 posts - 81 through 100 (of 123 total)