Investment Properties in QLD through Put and Call Option

Hi Greg would you be able to comment on my last post please…..

So in summary if I have it correct – if I take out a CALL Option on a Qld domestic dwelling for say 12 months with 2 x 6 month extensions written into option – and on sell CALL option to an ultimate buyer or nominee – I only pay the CALL option fee (negotiable with seller) let's say non-refundable for the moment. The ultimate buyer pays stamp duty on property once he/she gives a notice to purchase to seller accompanied with a sales contract to seller thought Real Estate agent nominated by seller. I also place a CAVEAT on property when taking out the CALL Option to protect my interest in property.  So what are the out of pocket expenses with this deal for me. Call Option fee let's say $1000, Caveat registration with Titles office – I think less than $200 in Qld, Do you have to notify local Council let's say Brisbane City Council that you have taken a Call option and Caveat on property? When exchanging Copies of CALL Option do you need a solicitor and if so what are the fees for administrating CALL option contract? I have a CALL options contract and is ready for use. Therefore no expense for Call Options preparation. Have a copy from a bootcamp I did recently. Although we didn't go into it in great detail for out of pocket expenses. What are the calculations for determining a CALL Option value? Is it a % of realised profit in deal that is: demo existing house and build 3 units with a realised profit of say $340K. Is 10% of that gross profit a starting point? Any help anyone can advise me on this subject would be appreciated. Thanks Bruce

Hi Bruce

I've got to agree with Terry.  We've been running our vendor finance business since 2003 and, without fail, every one of the the lease/options, instalment contracts, 2nd mortgages and deposit builders we use, to buy or sell with, is drawn up by our solicitor.

We also buy audit insurance from our accountant and we view using a solicitor for all our paperwork in a similar vein, i.e. our solicitor stands by his paperwork.

Cheers,  Paul