Hi all,
Well, I’m a first home buyer, currently in the market. We’ve got a place under offer in Forest Lake, just outside of brisbane-major.
3 beds, 2 bathrooms, flash new kitchen, pebblecrete pool out the front, and a nice patio. $429k they want for it. Around ~14 years of age. Cladding is blue-board/Fibro by the looks. Not a brick home. We offered the $429k based upon what we saw on rpdata.com.au, for the size, area and inclusions, it seemed like a good deal.
Had the building + pest inspector out today – and they found evidence of previous termite damage, and the potential for plenty more if several slab/surface issues aren’t sorted out (the required 75mm clearance for the concrete slab has not been taken care of – and needs redigging, draining changed etc).
For $429k, it’s a fairly serious amount of house, given not many of the other places in Forest Lake have a pool for this price range.
1. Does it sound like a good buy? In general, what do people know of the area? I know there will be a brand new train like there at the end of next year. Surely this could do good things for value of land/area?
2. In terms of “thing that can be done to improve value” to the home, it’s sort of all done already. Pool. Nice kitchen. Decent bath rooms et al. What more can one do to make sure the investment somehow ends up paying off/ends up making money, in the long run? I thought maybe water tanks, and solar hot water systems?
I’m generally worried that if I buy something that not a fixer-upper, I’ve got nowhere to go and therefor isn’t a smart investment. Sensible or?
3. The termites issue scares me. Even if they’ve only found old, inactive damage where termites *were*, it still concerns me a lot. I’ve got the inspection people coming out with a “Borer-scope and Thermal Imaging” hardware, to totally check the place over. On the outset, it all looks minor, but it could cost to fix..
4. Some water damage found on one of the walls as a result of incorrect drainage and bad guttering installation etc, too.
Thoughts/feedback/suggestions? I’m considering making a lower offer on the place, based upon the inspections, in negotiations – maybe $420 or $415k.
Thanks all!
z
Hmmm
Sounds too expensive foir a 3 bedder …
Collingwood Park 4 bed DLUG new for under 400k … u can buy new in Coomera for the same money ??
Termites are a major problem …
Can't say that I would even consider a house that had termite history. You can get insurance for it apparently (http://www.jlta.com.au/files/PestWisePressrelease050508_F.pdf) , but I note there is only coverage to $100k, which appears to cover repair and replacement costs, but no mention of temporary accommodation costs while the said repair is occurring.
Jacqui Middleton | Middleton Buyers Advocates
http://www.middletonbuyersadvocates.com.au
Email Me | Phone MeVIC Buyers' Agents for investors, home buyers & SMSFs.
Interesting.
So for the majority, people think I should walk away from this one?
On the outset, it looked like a good buy, simply because of the 20k++ pool installation and that on the surface, 20km from the city, with a new train line going in was a good deal…
But maybe not so much?
Looking for the wisdom of crowds…
z
Personally, I would not consider the presence of a pool to be more important than the structural integrity of the actual main residence. Have you thought about getting a house that doesn't have termite problems and doesn't have a pool, but has space to install one?
Here is a rough guide of pool installation costs
http://www.improvemyhome.com.au/articles/swimming-pools/swimming-pool-prices-the-cost-of-splashing-out-on-a-poolYou would need to do more homework on these costs, and I would assume it would not include paving around the pool, installing the pool fence etc
Jacqui Middleton | Middleton Buyers Advocates
http://www.middletonbuyersadvocates.com.au
Email Me | Phone MeVIC Buyers' Agents for investors, home buyers & SMSFs.
Good thoughts there, JacM.
Looking into it now. This is always a possibility, and has potential to lower my loan, and improve property value in the long run.
Indeed. Remember this is just my opinion. There will be many other opinions out there. I just think getting all excited about the presence of the pool when there are major concerns about the house itself is a strange ordering of priorities
Jacqui Middleton | Middleton Buyers Advocates
http://www.middletonbuyersadvocates.com.au
Email Me | Phone MeVIC Buyers' Agents for investors, home buyers & SMSFs.
Bummer, sounds like a nice place and I bet you have fallen for it!
Yeah, I'd do a runner. Its a lot to spend on your first house and have the thought termite damage in the back of your mind all the time. Termites are a fact of life for most of Oz but there are plenty of homes not affected.
Plus the drainage issues…whats next? Does it smell mouldy? I bet its been recently painted
Too many questions for 400 plus big ones.
Good luck and keep looking.Lalibella wrote:Bummer, sounds like a nice place and I bet you have fallen for it!
Yeah, I'd do a runner. Its a lot to spend on your first house and have the thought termite damage in the back of your mind all the time. Termites are a fact of life for most of Oz but there are plenty of homes not affected.
Plus the drainage issues…whats next? Does it smell mouldy? I bet its been recently painted
Too many questions for 400 plus big ones.
Good luck and keep looking.Indeed, it WAS recently painted actually, and the building and pest guy said this in a suspect way to us!
No mould smell however.
Ultimately, the pest inspector, the agent, all such individuals involved, will not be in a position to look you in the eye and tell you whether you should buy the place or not. I think if you re-read your original post, you will see that you already had big doubts before we even put our 10c worth in. I imagine that as a first home buyer, you won't have a big slushy fund to deal with unforseen problems. This house already sounds like it has serious problems. Forget the pool and the pretty stuff. It can cloud your judgement. Step 1 is to look simply at the price, location and structural integrity of the building. Secondary to that is the aesthetics and nice-to-haves such as pools. You can pretty a place up later. You would not, however, want to have to do major structural works.
Jacqui Middleton | Middleton Buyers Advocates
http://www.middletonbuyersadvocates.com.au
Email Me | Phone MeVIC Buyers' Agents for investors, home buyers & SMSFs.
Hi Zebrax,
I live and work in Forest Lake. Honestly depending on where the termite damage is I would possibly walk away. I have purchased my own home in Forest Lake. My house did have previous termite damage HOWEVER it was outside in a small plank of wood in the very small retaining wall. So I continued to buy it.
Having said that, I have seen properties fall apart due to termite damage (I work in rentals for a real estate).
If you were to continue with the purchase, I would be obtaining a quote to put ina new barrier adn confirm it does have a guarentee on it. Quote on repairing the termite damage and then turn around and ask the sellers to etiher do the above / drop the asking price by the amount or walk away.
Termites in Forest Lake don't go away. It was the construction guys here, when building Forest Lake they just demolished all the massiv termite mounds out here and then started building, so there are termites everywhere.
Sorry to be bearer of bad news though. Hopefully you will find another place, but Forest Lake is a great place to live! There is also a 3 bedroom, 2 bathroom place next to me for sale for waaaay less than what you paid, I know it has a pool too! You are looking at UNDER $360k for next door!
Forest Lake PM wrote:Hi Zebrax,I live and work in Forest Lake. Honestly depending on where the termite damage is I would possibly walk away. I have purchased my own home in Forest Lake. My house did have previous termite damage HOWEVER it was outside in a small plank of wood in the very small retaining wall. So I continued to buy it.
Having said that, I have seen properties fall apart due to termite damage (I work in rentals for a real estate).
If you were to continue with the purchase, I would be obtaining a quote to put ina new barrier adn confirm it does have a guarentee on it. Quote on repairing the termite damage and then turn around and ask the sellers to etiher do the above / drop the asking price by the amount or walk away.
Termites in Forest Lake don't go away. It was the construction guys here, when building Forest Lake they just demolished all the massiv termite mounds out here and then started building, so there are termites everywhere.
Sorry to be bearer of bad news though. Hopefully you will find another place, but Forest Lake is a great place to live! There is also a 3 bedroom, 2 bathroom place next to me for sale for waaaay less than what you paid, I know it has a pool too! You are looking at UNDER $360k for next door!
Wow.
. Epic fail, by the sounds of it.I can tell you now, the termite damage found is on a small architrave inside the door of the living room. It *seems* like a small bit of damage, but this is why we want to exercise significant due diligence to find out the real extent of the damage, if there is any significant damage.
We are getting quotes on the new barrier. Also getting quotes on the damage repair.
As for price – wow, now I’m depressed. The place really did “feel” like it was worth this much – as the kitchen was very new, and the whole place seemed pretty polished on the inside.
We will see how the damage comes out, and what the quotes come to I guess. If we’ve got too much damage on important parts of the building, I think we should run away as quick as we came! I guess that is the point of the “subject to building + pest” inspection clause
.Hi Z,
I'd also side with the comments made by other forum members.
You mentioned that it's cheaper than anything else in the area that is similar – think about why…
If we just consider PPORs for a moment, nobody want's to buy someone else's problem (this applies whether its a car, business or house)…the exception here is if you're fixing a problem to provide a solution – eg: Reno's…
Additionally, how long has it been on the market, have other potential buyers enquired in detail and backed away due to what was found ??
While it is true that termites can be completely eradicated, and the damage rebuilt, you're still buying a product that has at one time or another had faults and serious concerns…can you live with this ??
At the end of the day, the decision is yours to make – we can only provide our opinion towards your situation, be it positive or negative…I hope it's helped
All the best with your future purchase, where ever it may be.
Cheers,
Darren
dnh83 wrote:Hi Z,
I'd also side with the comments made by other forum members.
You mentioned that it's cheaper than anything else in the area that is similar – think about why…
If we just consider PPORs for a moment, nobody want's to buy someone else's problem (this applies whether its a car, business or house)…the exception here is if you're fixing a problem to provide a solution – eg: Reno's…
Additionally, how long has it been on the market, have other potential buyers enquired in detail and backed away due to what was found ??
While it is true that termites can be completely eradicated, and the damage rebuilt, you're still buying a product that has at one time or another had faults and serious concerns…can you live with this ??
At the end of the day, the decision is yours to make – we can only provide our opinion towards your situation, be it positive or negative…I hope it's helped
All the best with your future purchase, where ever it may be.
Cheers,
Darren
Hi. Well said, I think.
It was on the market 2 days, and seemingly had a LOT of interest, which is why we put an offer down so quick. We felt, being eager young first home buyers, that we should try and get the jump on others, as soon as it popped up. I guess maybe we were a bit naive?
I feel at this stage, it somewhat hangs on the results of the borer-scope inspection work. I’ll keep you guys updated as to how things go. You’ve been really good to me, so I feel it’s only fair to keep you up to date on it, so that others might learn from my mistakes!
z
Just remember your clause in the contract – don't feel obligated to purchase unless you're 100% confident with your decision.
At the end of the day it's your decision – the agent will try his/her best to persuade you, that's their job.
And remember, each and every day more properties are listed for sale ("There's plenty of fish in the sea")…
dnh83 wrote:Just remember your clause in the contract – don't feel obligated to purchase unless you're 100% confident with your decision.At the end of the day it's your decision – the agent will try his/her best to persuade you, that's their job.
And remember, each and every day more properties are listed for sale ("There's plenty of fish in the sea")…
You’re right. There really are. QLD might be growing out of control, but we are fortunate. We live in a country where there is still feasibly plenty of space left for everybody, for the most part!
I too would side with some of the others:
- find a cheaper property without all the whistles & bells on the same size (or bigger block).
- Is the train line a certainty? Has construction started at this end? If so, what else is available in the area which meets your requirements?
- What will it cost to bring the other things to another block? Ie new kitchen, repainting, landscaping, pool etc? Doing all of those in your own time will improve your initial bottom line (less stamp duty etc) and you can get the features that you want.
- Is the site close to Forest Lake shopping centre/schools/proposed station/bus etc? Just some of the usual considerations.
I too would side with some of the others:
- find a cheaper property without all the whistles & bells on the same size (or bigger block).
- Is the train line a certainty? Has construction started at this end? If so, what else is available in the area which meets your requirements?
- What will it cost to bring the other things to another block? Ie new kitchen, repainting, landscaping, pool etc? Doing all of those in your own time will improve your initial bottom line (less stamp duty etc) and you can get the features that you want.
- Is the site close to Forest Lake shopping centre/schools/proposed station/bus etc? Just some of the usual considerations.
There may be some minor penalty for pulling out during the cooling-off period, but this is much better than to be stuck with an expensive mistake.
Lastly, you have matched the vendor's asking price. If you are keen on the property, even with the apparent issues, use the pest/building inspection and quotes for repairs to hammer the price down by $30-40k or whatever it is going to cost + a fair margin more.
Yup. Waiting on the quotes for repairs, let alone the borer-scope. I think we can knock 20k off without too much drama! That said, depends on how motivated the seller is. We’ve been lead to believe that the current owners need to get out _fast_….
All the more reason to be bargaining downwards and moving away from your original offer.
. Epic fail, by the sounds of it.
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