Hi,
need some opinions on this subject. I have found 2 properties that I am very interested in. one has asking price of $885 and has been on the market for a while, was originally listed at $925, it is in a fantastic position but has an extremely run down 2 bed house, it is on large acerage which is also run down. The other is on smaller acerage but is well maintained, but the house is also pretty terrible. The asking price for this is $779. I want to put in a really low offer on one of these properties, but my partner says it is a waste of time. What do you think? Have got my info from the valuer generals dept on recent sales prices, and there is no rhyme or reason in this particular area. Properties are selling for between $8,000 per acre up to $25,000 per acre! Our plan is to move to this area in 5 years when all the kids are thru high school, and hopefully we will have paid off a large portion. Would it be too embarrasing to offer a huge amount less?????
Thanks
VyvyenDo you really care if it is ’embarrassing’ or not? If I could get a property for 100k or 200k cheaper, I would dress up in a chicken costume on national television. Who cares what other people think?
Robert Bou-Hamdan
Mortgage AdviserM: 0414 347 771
E: [email protected]
W: http://www.mortgagepackaging.com.auFREE Finance-Related Newsletter: See – http://www.mortgagepackaging.com.au/index_files/newsletter.htm
Comments made are of a general nature and should not be construed as individual advice.
© 2004 Mortgage Packaging Pty Ltd
Can you find out anything about the owners and their motivation for selling eg from neighbours. Might help you in negotiating. My suggestion is look at the total you are willing for the property to cost you over the next few years eg price you are willing to pay plus interest you will be paying on whatever you borrow less income from property or tax advantages if any.
Say hypothetically you are willing to pay $700K and would need to borrow $500K over 5 yearswhich might result in $90K interest. Disregarding tax benefits if you got interest free vendor finance you would be in the same position if you paid $790, put 200K down and made monthly paymnets over 5 years of the balance. If there’s a deceased estate or someone needs to move into care or something like that this might satisfy both your needs, but you will need to know more about the vendors.
As Robert says there is nothing embarassing about making a low offer.
Originally posted by vyvyen:….Would it be too embarrasing to offer a huge amount less????? Thanks Vyvyen
Hi Vyvyen
Love how you spell your name!! How do you pronounce it (starting with an “Eve” or a “Why”)?
My tip is to gear up mentally to optimise your success in this game:
~ Spend the money and read quality books on negotiating skills (generally, plus specific to real estate)
~ Do a few google searches on negotiating tips and skills.You’ll be amazed how much your “study time” pays off when you start applying these lessons in the real world.
Which books?
~ Peter Spann’s “$10 Million Property Portfolio in 10 Years” has an excellent chapter on how to negotiate property deals. He quotes a professional negotiator extensively, and has lots of tips.Best website?
This one’s a bit off the topic you’re asking about, but interesting nevertheless.
~ No Money Down Deals at:
http://www.buywithnocredit.comRe Google, I prefer doing Advanced Google Searches. I’d play around with different combinations of keywords such as):
“Real estate” negotiating tips negotiation
“how to negotiate”Use your imagination to invent creative keywords.
Cheers, good luck and let us know how you got on, okay?
GregHi,
thanks for all the much valued help, will now be busy searching the internet for negotiating tips and ordering a “chicken costume”. We have no deposit as have been busy paying off own mortgage and increasing super wealth. The first property is over 100 acres and is owned by an old lady, who no longer lives there, it has a tenant/caretaker paying $100 p/w. the second is owned by a wealthy family who use it for holidays, don’t think they will be very negotiable on the price. the properties are about 2 1/2 – 3 hours from perth and are not income producing. I believe they have the potential for huge capital growth in the future, prices have doubled in the last 2 years in this area, am worried if we leave it any longer we will miss the boat and it will become impossible for us to have our acerage down south.
Hey Greg, Vyvyen (Vivien) is from “The Young Ones” the brilliant English comedy???!!! have you seen it?
I loved ‘The Young Ones’. I was shattered when it went off the TV.
Vyv, you might have some trouble with security types. They are not considered favourable when they are so big and so far from Metropolitan or Regional centres. More deposit will be needed and/or possibly higher interest rates.
Robert Bou-Hamdan
Mortgage AdviserM: 0414 347 771
E: [email protected]
W: http://www.mortgagepackaging.com.auFREE Finance-Related Newsletter: See – http://www.mortgagepackaging.com.au/index_files/newsletter.htm
Comments made are of a general nature and should not be construed as individual advice.
© 2004 Mortgage Packaging Pty Ltd
Originally posted by The Mortgage Adviser:
I loved ‘The Young Ones’. I was shattered when it went off the TV. Vyv, you might have some trouble with security types. They are not considered favourable when they are so big and so far from Metropolitan or Regional centres. More deposit will be needed and/or possibly higher interest rates. Robert Bou-HamdanI too loved “The Young Ones” but never checked out the spelling of character names. Our daughter’s name is Diipti (Sanskrit, the language of Yoga = Brilliance of the Supreme One). When Diipti was a kid she was SO RAPT when she saw how Danii Minogue’s name was spelt she said: “At last, someone who has at least TWO i’s in their name. Doesn’t ANYONE have 3 iii’s like me?” [biggrin]
I’m with Robert the Bruce (sorry, Robert the Broker!) re problems with the bank’s LVR (Loan Value Ratio) and DSR (Debt Servicing ratio) in rural areas. Your bank will apply punishing mathematical algorithms to calculate how much risk they’re prepared to accept in the sort of rural deals you’re interested in.
The good news is that there’s a much better way. Read the chapter on how to track Median Price Rises in particular postcodes to determine the PRECISE POINT you need to buy into a region (it’s in Peter Spann’s book “$10 Million Property Portfolio in 10 Years” at your local Bookworld or Dymock’s). I have commented elsewhere on this forum about his awesome application of Median Price statistical data. Do a search on my latest posts (click on my Yosemite Sam logo) to bring up my posts over the past 1-2 months and you’ll find Spann’s “212” method detailed thoroughly.
Basically, given that the area’s prices have DOUBLED recently, you needn’t panic. You’ve got PLENTY of time to plan your next move. Read Spann’s book and log onto the “Aussie Valuer” website:
http://www.eaussie.com.au/aussie_valuer.htm
Put in the area’s postcode and get a FREE Residex printout of Median price rises in the area where these farms are located.
No need to rush, okay?
Gregthanks Robert and Greg, glad to meet fellow “young Ones” fanatics – addicted to my dvd’s!!! Your help is very much appreciated – have now finished surfing at beach and will now surf the net with all your info.
Thanks guys
Vyvyen, Rick, Mike and Neil
xxxxbummer, aussie valuer does not cover western australia – will continue searching the net as valuer generals department was of no help. thanks again
VyvyenOriginally posted by vyvyen:Bummer, aussie valuer does not cover western australia – will continue searching the net as valuer generals department was of no help. thanks again Vyvyen
Hi Vyvyen
Aussie Valuer is such a great site, but doesn’t cover WA? How about:
1. You copy/paste this entire thread to a blank email form
2. Email it to Aussie Valuer, letting them know their site is being widely promoted
3. Then point out the defect re WA, and ask them if they can help in some way.Let us know how you get on by posting your letter to them on this thread.
Also, click on “Forum Boards” in the top LHS of this site’s Home page, then go “Search”, then input “Aussie Valuer” to find all the threads this site has been posted on.
Do a similar search on http://www.somersoft.com.au forum, remembering to let us know how you get on, okay?
Cheers
GregIf you are going to copy and paste this thread to Aussie, let John know that he owes me around 40k and if he keeps ripping his old brokers off, it will eventually come back and bite him in the bum!!!
At Aussie, they will save you…
At Mortgage Packaging, we’ll REALLY save you!!!!
Robert Bou-Hamdan
Mortgage AdviserM: 0414 347 771
E: [email protected]
W: http://www.mortgagepackaging.com.auFREE Finance-Related Newsletter: See – http://www.mortgagepackaging.com.au/index_files/newsletter.htm
Comments made are of a general nature and should not be construed as individual advice.
© 2004 Mortgage Packaging Pty Ltd
Making an offer would take about as much time as writing this post. What have you got to lose? – a few thousand dollars if you don’t.
Terryw
Discover Home Loans
Mortgage Broker
Click below to email meTerryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
http://www.Structuring.com.au
Email MeLawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au
Hi Vyvyen,
I am propably coming in a bit late on this point but dont feel embarrassed about making a low offer. You have the right to make whatever offer you like. On my first house i made an offer of $70K on a place listed at $92K. They knocked back $70K but 3 months later we came to an agreement at $75K we had to start somewhere and so do you. Go for it.
John
Irrespective of what the market tells someone, or how much land is worth per acre, or anything elso, its all down to vendor motivation. Being a real estate agent, i field all types of low offers all the time. If the low offer doesn’t fall into the range of the prospective seller, i tell the buyer not to waste their time. (I do however, put the offer in, as you know, by law in NSW an agent must do this)
I would make a ridiculous offer and staple a cheque to it.
Are the properties actually for sale?
What does the valuer general or aussie valuer have to do with this deal anyway?
Local agents could tell you what it is worth.
I see this thread as lots of talk no action.
Get bank or broker to help you, even try and seek preapproval.
Are you getting deposit from equity in another property?
What is your dilemma in making an offer.
For a small fee I would be happy to make the offer for you!!
I have no shame..hahaha
I would start at $600k to the old lady what would she care?
Byronent
Adelaide SAHi all,
The property that was originally listed for $925 has now plummeted to $830, vendor desperate to sell. Going down on Saturday and will offer $650 – hey they can only say no – not prepared to pay over $6,500 per acre. Acerage, horses and excellent surf beaches – what more could you want!!!
Vyvyen
An asset is only worth what someone is willing to pay for it. The vendor could list the place for 950, and if you got it say 30grand cheaper, you would think you’re getting a bargain. But basically it’s been on the market for a while because no-one is willing to pay that much for it. Therefore, it’s obviously not worth the asking price (or previous prices).
(“,) $$$ HoLdEnCoMmOdOrE $$$ (“,)
Good luck Vyvyen.
Let us know how you go.
I would start at $600 it is easier to go up and impossible to go down.
Byronent
Adelaide SA
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