All Topics / Help Needed! / spotters fee??

Viewing 14 posts - 1 through 14 (of 14 total)
  • Profile photo of reggie29jetskireggie29jetski
    Member
    @reggie29jetski
    Join Date: 2008
    Post Count: 8

    Hi
    Does anybody know where i would start to perhaps earn myself a spotters fee for a property i have found that i am not in the position to aquire myself at the moment,  however-a great bargin for somebody!!?????

    Profile photo of Scott No MatesScott No Mates
    Participant
    @scott-no-mates
    Join Date: 2005
    Post Count: 3,856

    Negotiate a price, put an option on it (with assignable rights) then seek a buyer. That way, you will pay a small premium (which will form part of the purchase price or be surrendered), have an exclusive dealing period and be able to sell what you have yet to buy at a decent profit. Even if you have a $10k option and you make $20k on the deal you have risked very little for a 200% profit.

    Profile photo of reggie29jetskireggie29jetski
    Member
    @reggie29jetski
    Join Date: 2008
    Post Count: 8

    Thanks Scott
    please forgive me as i am very new to this game and to this website-i didnt get what you mean??  Do i have to buy the property first??  Whats the process?? have you done so in the past??

    Profile photo of Scott No MatesScott No Mates
    Participant
    @scott-no-mates
    Join Date: 2005
    Post Count: 3,856

    An option is a contract to puchase something (property or shares) for an agreed value at some time in the future with the person taking out the option paying the owner an 'option fee'. Eg a developer will pay an option fee to the property owners subject to recieving development approval or rezoning  within 6 months. The developer will outlay say 2-5% of the agreed price of the house as the option fee for the exclusive right to achieve a DA etc within a set time period. He further agrees that he will buy the property at the agreed price prior to the expiry of the option period, if he doesn't proceed ie fails to achieve the DA/Rezoning he will withdraw from the sale and forfeit the money paid for the option. The vendor must see that there is value in it for him not to sell at present but wait the option period (money is an incentive, so is the opportunity to lease back a property on  a long-term basis freeing up their cash).

    You would need to talk to your solicitor about creating the option, period, option fee, creating the caveat and framing the offer, etc. If you take an option you will need to secure your position on the title of the property by way of a caveat restricting the owner dealing with anyone else/selling the property.

    The beauty of an option is that you do not buy the property (although you can), you on-sell the option to someone else who will exercise the option. Your outlay is the option fee & costs. You will have to find someone willing to purchase the property prior to the expiry of the option otherwise you will lose your 'deposit'. As you haven't bought the property, you do not pay stampduty on the transfer of the property (only on the transfer of the option).

    The concept varies from a 'flip' where you buy a property off the plan (under construction) and try to offload it for a capital gain (flip it) before completion however the principle of having a small outlay/deposit then trying to find a buyer is the same. Unfortunately with flips, you may end up having to buy the property if you haven't offloaded it (found a buyer) before settlement.

    Profile photo of TerrywTerryw
    Participant
    @terryw
    Join Date: 2001
    Post Count: 16,213

    you may need a realestate agents licence to charge a fee for the introduction of a property

    Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
    http://www.Structuring.com.au
    Email Me

    Lawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au

    Profile photo of Scott No MatesScott No Mates
    Participant
    @scott-no-mates
    Join Date: 2005
    Post Count: 3,856

    Terry, would that be the case? There is generally no requirement for being buyers agent (I believe this is an unregulated market still but will/may have changed) however there is nothing preventing you selling 'your' property privately – all you need is to meet the requirements to transact the property or to assign the option.

    Profile photo of Richard TaylorRichard Taylor
    Participant
    @qlds007
    Join Date: 2003
    Post Count: 12,024

    SNM

    In Qld if you sell more than 6 properties a year (even privately) you are required to be licensed.

    Not sure about other States but i have a feeling Terry is correct.

    Richard Taylor | Australia's leading private lender

    Profile photo of TerrywTerryw
    Participant
    @terryw
    Join Date: 2001
    Post Count: 16,213

    In NSW Buyer's agents need to be registered with the department of fair trading. They must do a course which is almost the same as the full real estate licencee course – 12 weeks or so full time.

    Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
    http://www.Structuring.com.au
    Email Me

    Lawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au

    Profile photo of Scott No MatesScott No Mates
    Participant
    @scott-no-mates
    Join Date: 2005
    Post Count: 3,856

    Dang, another licence fee! It'll be a while before I get 6 a year though.

    Profile photo of supersarafusupersarafu
    Member
    @supersarafu
    Join Date: 2007
    Post Count: 7

    Does anybody know the rules relating to Victoria on the matter?

    Also, how does one go about finding investors who might be interested in buying such a property off your hands?

    Profile photo of reggie29jetskireggie29jetski
    Member
    @reggie29jetski
    Join Date: 2008
    Post Count: 8

    Thankyou everybody for your help-just wanted to double check were all still on the same question??  I was under the impression if you found a good deal and passed on the info to another investor that thats how you can make a spotters fee for yourself??  I didnt think you actually had to buy the property-pls explain??

    Profile photo of JONCHUJONCHU
    Member
    @jonchu
    Join Date: 2004
    Post Count: 112

    Terry is right, you do need a Buyer's agent license. In regards to being a spotter, what do you consider to be a good deal? what is your experience? How many IP's do you own or have negotiated in behalf of clients?

    Profile photo of Scott No MatesScott No Mates
    Participant
    @scott-no-mates
    Join Date: 2005
    Post Count: 3,856
    Terryw wrote:
    you may need a realestate agents licence to charge a fee for the introduction of a property

    Is that the same for selling through a wrap contract?

    Profile photo of reggie29jetskireggie29jetski
    Member
    @reggie29jetski
    Join Date: 2008
    Post Count: 8

    Hi Jon
    Im am new to the whole game-didnt know it was like that-that it depends on how many propertys you have yourself to be able to get a spotters fee for a good find!  Thanks anyway :)

Viewing 14 posts - 1 through 14 (of 14 total)

You must be logged in to reply to this topic. If you don't have an account, you can register here.