Proactive, not reactive:NZTip of the Day

yes exactly wilandel, a new old people’s home has gone in, private sales, houses for rent, special on curtains, talks of the Warehouse opening up, jobs on offer, just to get a vibe on how the town is doing, etc.

Sometimes you can respond to information in the local paper by investing!

Some of the information might not necessarily make it to the national papers or even news websites, but they are also good to check.

NZ Investor and Bird Dog

Tip #6

The less you know the market, the more locals you need to enlist to bounce ideas off. Ask the girl or boy at council (i.e.) what she thinks are the good streets, the bad streets. Ask your building inspector what they reckon. Talk to a rental manager NOT connected with the sale of the property. Ring up the cops.
The more you can keep people talking, the more information you’ll get. The more personable, pleasant and amusing you are, the more they’ll want to keep on chatting and telling you stuff. And the less they’ll think of you as ‘just another Australian investor buying off the internet’. At least (if you still are that) you’ll be percieved as a SMART one who people find a pleasure to deal with.

NZ Investor and Bird Dog

Tip #7

Look at building options as well, whether that be adding another bedroom, relocating or building a minor dwelling onto the site, a granny flat, moving a bach onto the site, building a unit on the back, and things like that.

This strategy can work really well in a growth area where houses are say more than 100-130k each.

You may be able to make 20-40k by ‘creating’ a 100-130k dwelling rather than just buying one ready done.

NZ Investor and Bird Dog

Tip #9:

Make loads of offers!
These days, I find I am making about seven offers to get one accepted. It’s a hot market, and if some greater fool than you is going to pay more for the property you want, with less or shorter conditions, then there’s nothing you can do.

Make a formal written offer for the best price you are prepared to pay on every property that you think is a contender. Sometimes, you never know! Make cash offers, not subject to finance, but give yourself an out in the form of a builder’s or ‘subject to satisfactory’….
(your lawyer will advise.)

Don’t worry about being ‘in a multi-offer situation’ – just put it in anyway. And give your offers an expiry (say a week or perhaps more.)
Then leave it, mentally, until you hear! And meanwhile keep looking and making more offers!

If you end up with too many contracts accepted and they’re CF+ve, email me! I might be able to take them!

cheers-
Mini

Hi guys, here’s another really good one (I reckon!)

When you’ve got your builder’s report and there’s the inevitable structural ‘something’ that you sometimes get, some defect revealed, and it is time to negotiate, I strongly recommend negotiating verbally with the vendor through the agent, rather than committing anything to writing through your solicitor to the vendor’s solicitor – well, at least not prematurely and before you have a verbal agreement.

The way that I tend to get the best result is ‘I’m happy to go unconditional, I just have a concern about this and this so if you agree to this this and this, then I will go unconditional’. This usually seems to work pretty well…unconditional is a word with great meaning to vendors and agents!
This is because the agent gets paid if the deal gets across the line, so they have a vested interest in a win/win outcome. The vendor’s lawyer, on the other hand, doesn’t have the same $$$ at stake if the deal goes ahead or not!

So hopefully, you can negotiate through the agent, who can then draw up a ‘variation’ to the contract, which, when signed by both parties is all good and now what you have already agreed verbally is also agreed in writing. The other benefit is of course you didn’t incur so many legal fees instructing your solicitor to write the vendor’s solicitor, and vice versa – and everything is much quicker.

There is another reason why you don’t want to put too many demands in writing until you have sussed it out verbally. In a hot market, the vendor may have another offer in the wings as a back-up. Sometimes a better one than yours, so the vendor might be waiting for yours to fall over. Once you put something in writing through the solicitors, the vendor could view it as a ‘counter-offer’ and cancel the contract. It doesn’t happen too often but it does happen.

And of course if the vendor says ‘no’ to what you are asking it may still be worth proceeding to unconditional anyway.

On my most recent purchase there was a roof issue and I asked for $1000 discount and the vendor still said flat out ‘no!’ I still went ahead with the purchase anyway as it was still an incredible deal for the price. But I did try, and yes, I will have to spend money on the roof – and yes, it’s still a good deal even taking that into account!

So yeah, to sum up my tip of the day, when negotiating, do it verbally first through the agent. Another reason why this can work well is that the agent also usually has a much more personal relationship with the vendors then the vendors’s solicitor and you can usually get a good ‘vibe’ through them if the vendors will come to the party.

cheers-
Mini