Terry's correct. If you assign the option to another party, they will pay you a fee for that assignment to be completed, which would ordinarily be the difference between the vendor's strike price, and your profit margin. They would pay you that up front, and then on option expiry (or whenever they choose to complete the transaction) they then settle with the vendor.

As Terry suggests, look at your option document, ask your solicitor and make no assumptions.

Duckster – any assistance on where you can find/buy the book? sounds like an interesting read.

Sean – not sure what sector or what size of deal you're looking to do, but generally speaking some things you may need to consider are:
* Option Fee. Deals for a dollar are rare indeed. Most vendors these days, in this market, will be looking for an option fee up front. Industry standard can be about 1% of option strike price, but if tis a larger lot for subdivision or the vendor is more knoweldgeable, you may be up for more.

* End buyers. Well and good to get an option, but if you have no end buyers in mind, whats the point? Know who you're going to market to, and know also that tis something they're interested in. This is a very tough market for developers (generally) and they are picking the eyes out of the good stock, and anything that doesn't have a holding income or low risk is getting passed over (at least at the bigger end of town).

* DA – I know some spruikers out there will simply try (or tell you they can succeed doing so) and onsell the option with no DA at a higher price than the negotiated strike price. Think selling sizzle with no sausage. Doable? Sure. Recommended? Not in my opinion. Even going part way through the process will add more value to the option than no DA at all. Its only really viable if you can secure a 3year option and onsell factoring in capital growth.

*Demand for product. Work out what sites you're looking at, and what you can do with them, and if the market is hungry for it, either now, or will be around the end of your option time frame. Don't try and sell apples to a market that wants strawberries.

* Lastly, do your research. Not meaning to tell you how to suck eggs, don't know you or what you know either, but its something i see a lot of people failing to do, and paying the price for doing so, and this includes the people you deal with. Know your partners, know your market, and know your buyers.

Good luck with whatever you choose to do.

Cheers
Matt.

Got a link to any info on this one?
Can't wait to get rid of Rudd and Gillard. The pair of them are just left of Chairman Mao..

Not saying it 'can't' be done.. but getting an option fee of $1 is not the norm. Yes some people can still do it, depends on the size of the deal. Single resi option and flip more likelyl than a 20 acre lot for subdivision.. be prepared for that. Vendors are a bit more educated these days..

If they've assigned you an option over their property, and the legalities of it are intact, then you would simply sell the property in the normal manner. Using an appropriate information memorandum detailing all the relevant material and research around the property is a must. In my opinion anyway..

The issue you may have is whether you've improved the property in any way ( DA/BA etc) or are simply counting on capital growth for profit, or if your'e trying to sell the sizzle without the sausage. All of this will impact on what you can reasonably ask for the assignment of the option. So will the length of time remaining on the option, obviously longer is better. All things being equal when you were granted the option by the vendor it should have been made clear that your intent was to onsell or sell the property, or purchase it, depending upon the conditions you included in the option document and if it was Call/Put etc.

Don't leave it too late, as you have to also factor in due dilligence for the purchasor etc.

You should also be very familiar with Corporations Act s708 before advertising investments. Lest you become foul of ASIC.

Nit
DA approval to subdivide literally means "Development Approval (sic) approval to subdivide". This means someone has already gone to Council, had the land surveyed, had a surveyor draw up plans, submitted them to Council and Council has stamped the plans for approval for the subdivision to occur. That means someone who wants to subdivide the block can now for all intents and purposes, put fences up in line with the plan in the size and shape and area of the lots, have sewer and power run in to those lots, and build houses/units or whatever has been approved on those lots to sell.

How much does it cost? How long is a piece of string, how big is the block, where is it, who did the surveys, have they paid infrastructure charges, which Coucnil area and what are their individual charges….and so on. It could be $15K or it could be $50K plus. It is totally dependent on the things I've listed above.

The checklist for subdivision is the Town Plan for wherever you are. Easiest way is to locate a lot of a certain size, get the address, and ring the local Council that controls the area where the property is located. They'll give you a basic indication of whether you can or not, but they'll also refer you to the zoning and town plan for more details.

Hope that helps.

Good luck trying to get him directly.. he tends to avoid speaking to 'students' if he can unless he has to or he wants something from them. Thats how he was when I was involved with Massland. I got some kid who'd never done a deal in his life trying to 'mentor' me. I daresay that's still the case.. but who can say for sure.

I"ve been contacted by a number of people in recent times asking me if I knew how they could get their money back as they'd seen what the reality was with the Conclave programs etc, and that they were going through legal processes and speaking with Fair Trading etc. I don't know the outcomes of any of those but I know they're on going. I can't comment on the validity of their claims or experiences, only my own, and those of some people I know and trust. I'm sorry you've spent the money in truth (an opinion only I hold) but I hope you get the answers you're looking for. I doubt you will though.

One interesting question to ask would be this: prior to signing a legally binding agreement like a JV or option, are they willing to provide, under the auspices of a due dilligence enquiry via a certified practicing accountant or property solicitor, details of successful deals they've done from beginning to end and paid out so that you can "know your client or customer" as most Fair Trading offices encourage you to do?

See what they say to that. If they can't or won't (and you'll find "privacy" thrown up as an excuse however in business this kind of enquiry done via these means is perfectly legitimate) you should ask yourself why.

More than that I'd say to you there's more than enough information in this thread, combined with common sense, to be able to make a judgement on…

There's no cookie-cutter approach to site design. Each site is different depending on the cadasatral map/site specs/zoning/local council etc. You need to speak to an architect/designer. I can put you in touch with one in Brisbane who is excellent and does this type of thing regularly. PM if you'd like his details.