Hi Steve,

I wouldn’t go for this deal as you have structured here for several reasons:

1) Offer of 50k – this is significantly higher than your original offer of 40k – nearly 25% higher!! If you originally thought it worth 40k with room for some negotiation why would you then be prepared to go so much higher.

2) You have a desperate seller here – 180 days to settlement is not much use to a desperate seller.

3) Agent is legally obliged to put offer to seller – so let him do that. If he doesn’t, do it yourself.

4) Agents always say there are other interested parties!!

a) If so, where are they?
b) Why isn’t it sold then?
c) Agent will look bad to seller having over priced property in the first place so he will do all he can to get as a close a price to his initial guess as possible.

Tell the agent your final offer – say 45k max and say you will reduce this by 500 each week you are kept waiting. Call in two weeks and see whether they have a definite buyer who has instructed a solicitor. Chances are not.

I feel like I’m preaching to the converted here but if it was me I’d make my offer and then go look for more properties – they’re like buses – there will be another along in a minute.

Lisa.

Mmmmm, interesting property.

My guess is that for a property to be this positively geared there must be a pretty good rental market – if it is also tenanted at that price then that is also a good sign. Perhaps its rented by those working on the industrial site – roll out of bed and into work!!??

My personal opinon is that it wouldn’t make a typical good wrap property for a family as its too industrialised, too close to the road, too small etc etc. However, with some lateral thinking it could still be wrapped.

(Note: I take it you don’t want to continue to rent it as you don’t want tenant/maintenance hassles?)

In which case I suggest: –

1) Wrap it to someone outside the normal criteria – older divorcee, disabled person, young couple or single looking for first step on the ladder.

For example; I know someone at the moment who has asked me too look for exactly this type of property – he is 42, disabled and knows the banks won’t touch him despite getting a hefty amount of benefits each month which he will get for life. He wants a single storey home with room for him and his dog and is prepared to take properties others won’t as there’s just him so this sort of locale wouldn’t bother him.

2) Wrap it to an investor!

You could find a newbie investor who wants to try his hand at renting but is unsure of how to manage a rental property. This would be a good half way house – you carry the original mortgage so they have less costs and issues to worry about. But they manage the rental so you still have a hassle free wrap. Would be good for someone you are considering mentoring perhaps? You couldn’t use the FHOG I guess but may still work.

3) Wrap it to the existing tenants, as is, for less than or same weekly as their current rent – win/win.

4) Sandwich lease option/wrap for seller and just take a fee!

5) Knock it down and build something else more fitting with area.

6) Convert it to something else more fitting and profitable to area – offices, creche for local workers, cafe, pub, shop, take away, combination.

Regards, Lisa.