I have the possibility of purchasing a property wel under valuation and would like to advertise it and onsell it without me ever having taken posession to avoid stamp duty. Accordingly I have the following questions:
Can I market and sell the property to a 3rd party even though I don’t own it ?
If not by obtaining an option from the vendor first am I then able to ?
Can I avoid the 3rd party knowing what i paid for the property ?
If settlement is between the vendor & 3rd party what price is on the contact of sale and how do i get my piece of the action ?
Thanks
Hi McHenry
As you say, if you undertake a “flip” in this situation, you’ll have to pay stamp duty.
We use a carefully worded option to get the result you’re looking for. It works for us in NSW, i.e. we option for one price, we advertise and then on sell at a higher price. It took us awhile to get the option wording correct and to get all the steps organised, eg. dealing with agents and valuers but it can be done.
Also, once you are an option holder you are allowed to advertise the optioned property.
Cheers, Paul
Paul Dobson | Vendor Finance Institute
http://www.vendorfinanceinstitute.com.au
Email Me | Phone MeAn alternative way to finance your home.
I think i am right in saying that there is Stamp Duty on an Option Contract in WA.
Check with the OSR in WA but i think it is one of the States that bought it in.
By doing a Transfer by Direction the end purchaser will still now what you paid for the property.
Richard Taylor
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In WA a put/call option will attract imediate stamp duty, but I am told just a put or just a call by itself is ok.
when flipping in WA it is probably just easier to pay the stamp duty and be done with it.
http://www.megapropertygroup.comINVESTMENT SALES * RENTAL SOLUTIONS * STRATA MANAGEMENT
Stamp duty is payable in WA when you have an option to buy on a property, but its only applied to the up-front option fee not the whole price of the house…
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