It’s up to you what you’re willing to accept. Depends a bit on the market you’re in. If this is the only purchaser you’re likely to see for the next 2 years then maybe you’re happy to do whatever he requests. Personally it still sounds really one sided and I’d be negotiating some different terms.

If he actually wants you to take the house off the…[Read more]

It does sound a bit one sided. If you draft the conditions properly then there’s no reason you can’t give him all the time he needs while also making sure that he is not just a tire kicker. You risk a fair bit if you hold the property for him for 8 months and then he walks away from it. It’s reasonable for you to ask that he actually put some skin…[Read more]

The lender’s valuer is not there for the purchaser’s benefit. That valuer’s role is to sign off on document which guarnatees to the bank that if the purchaser defaults, the bank will be able to sell the property for the stated price. Therefore these valuations are always pretty conservative.

Unless you can point to an actual mistake in that…[Read more]

I asked a question about how to calculate sale price on lease options recently. Not quite the same issue but you might find something useful in it. I had some pretty helpful responses from a few people and they were quick to correct me when what I proposed sounded unreasonable.…[Read more]

@Property-Trader Jason thanks for your thoughts. I have heard time and again in relation to these structures that they have to be win-win deals and it’s about the people first and foremost. I’m not out to screw anyone over but this is going to be my first lease option deal so I probably do need to make some corrections as I go.

When I said 25%…[Read more]

I’d add to what @jason_staggers has said.

If you’re making multiple offers and not sure which ones you’ll go ahead with then a ‘get out’ clause, or cooling off period will help you. It doesn’t take that long to plug your details into a contract either so you may even prefer to just give the vendors contracts rather than the letters you’re talking…[Read more]

Thanks guys – both very helpful posts (I gave you thumbs ups too).

To add to this, do you guys use any type of formula when working out what the relevant figures will be? My property is in a pretty low growth but high cashflow area. I was planning to price it at about 25% above its current value for a 3 year option (or a bit higher for 4 or 5…[Read more]

I don’t know the Victorian process, but if that’s what your solicitor’s telling you to do then don’t waste too much time or energy second guessing it, and don’t take your friend’s advice over the advice of your solicitor. Settlements are very standard procedure for solicitors. Your solicitor also has a duty to look after you here, and you are…[Read more]

“30 days notice. If at any time of termination of this agreement the property is subject to a fixed term lease, then the owner agrees to pay agent 5% of the balance of rent payable till expiry of lease.”

So if i give them notice and get someone else on board do i have to wait 30 days before they start advertising ?

Firstly, I agree with the…[Read more]

That’s a great book, first real estate book I read.

My preference, although it may not suit your circumstances, is to go for cashflow first, and try to find properties where you can manufacture capital growth (eg the granny flat idea). Waiting for capital growth in the market is speculation, there is no guarantee. You can manufacture capital more cheaply too, eg a coat of paint, a new kitchen etc.…[Read more]

Stamp duty’s not necessarily payable at the date of settlement. In Tas it’s payable within 3 months of settlement. You could check on that for the areas you’ll be operating. Also, you don’t have to be the one that pays it – as long as it’s paid the State Revenue Office doesn’t care. So you could agree that the final buyer pays it. However, I guess…[Read more]

Thanks Catalyst, that’s helpful and makes good sense.

The relevance of the lease option is you’d be looking to place tenants for a longer period (or for good if they buy the place), so realistically I guess you’d have to wait until renos are done to commence a lease option. So it’d be 12 months of a normal lease, then renos, then lease option v…[Read more]