Hi All,
Just wanted to check something.
I have a contract subject to building. I understand that if the building inspection comes back showing that there is allot more work needed than what I anticipated I can then renegotiate the price. That is correct isn’t it?The second thing, If I do make a new offer, do I just write that on a new sheet of paper and fax that to the REA or does this new offer go into the existing contract. What happens to the existing contract and its other terms? Is a whole new contract needed? I suppose yes?
Thanks,
MarkyMark
My understanding is that the contract stands as is – you can’t renegotiate the price. However you can make requisitions on the existing contract that the seller fix whatever – the seller has the right to accept these requisitions or he can pull out.
Yo Ho Samwise
Thanks for the reply.
hmmmm…I’m not sure about that.
If a condition of a contract is not met then I cant see how the contract can still be inforced. If it can be, then why have conditions. If the contract falls over because a condition is not met then it would be reasonable to expect the ability to re-negotiate. Like I said I am not sure though.
I think you’re on the right track their MarkyMark.. usually the vendor will make the appropriate repairs and keep the offer price as is, or they will take the repair costs into consideration and lower the sale price accordingly.
You can re-negotiate after the building inspection if there are problems. You have a couple of options, just have an annexure (extra cover sheet) drawn up signed by all parties. The down fall to this is you pay stamp duty on the original agreed price. Or you can have a new contract drawn up, which means time & can give the vendor a chance to pull out if they are a bit shakey. Good luck.
CheersTake the Best & leave the rest
I think it’s better to have a cash discount and do repairs yourself than get the vendor to do them – the vendor might do a cheap job but not a good job.
Also stamp duty is only 2-3 percent isn’t it? So on say a $3000 discount that would only be an extra 60 bucks??
Hi there,
I recently purchased a block of flats (that sounds impressive!! – but really only three little flats!!!). The building inspection revealed a few things wrong with the property. I agreed to go unconditional on the building inspection clause if the vendor reduced the price by $2500.oo to cover some of the defects found in the report.
I presented this to the agent verbally, it was presented verbally to the vendor who agreed, and a one page statement of variation was signed by both parties to agree to the change (in NZ).
Here in Australia, I have varied the price down after the building inspection – the alteration is made on the contract with both parties initialling the change to price.
Why would you bother having a building inspection if you couldn’t address the issues that arose. Your contracted price is put to the vendor assuming no major unidentified issues. When issues arise, you have every right to alter the terms/price to suit you – if you have an amenable vendor!!! – who will make good the faults or alternatively reduce the price – otherwise you stay as is or walk away./
CDCastleDreamer
Castledreamer-
anyway, i think you’re impressive
cheers-
mini
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