Forum Replies Created
I think it all depends where the property is. If it is in Darwin or Cairns or somewhere where most houses have pools then it might be worthwhile. I think a house in the tropics would be far more rentable with a pool.
If however, your property is in Melbourne or Adelaide or Hobart or somewhere where pools are not standard then I wouldn't bother. Having a pool in these areas can add value (for example, an "executive" residence would be expected to have a pool and a tennis court), but generally speaking, for a stock standard IP, it wouldn't be worthwhile.
Cheers
K
The thing about Darwin is that traditionally it has been a risky market. When I bought in 04 the average yield was 10%. However, vacancy rates were always ridiculously high, I think as high as 20% at various times. This is why it was not considered a safe market to invest in.
However, over the last 8 or so years things have changed. There is a lot of work up there at the moment to the vacancy rates are now very low, perhaps even the lowest in the country. There is a desperate shortage of land so there is a premium on rents. For example, I had a block of flats in Stuart Park, the next suburb out of the CBD. They were pretty basic two bedroom, one bathroom units. When I sold them last year, they were each renting out for over $300pw.
When I started buying in Darwin, older style units were selling for about $70 – 80,000 and were renting out at about $150pw. Then the boom started and every property I owned doubled in value in two years, all the while being positively geared. I sold out of everything for several reasons. Those units are now worth about $300,000 each, although saying that, I have no regrets selling out when I did. The rental yield on those units is now about 5 – 6%.
While there is a resources boom in Australia, Darwin will continue to have a low vacancy rate. But because it is still a transient city (although not as much as it used to be) there will still be an element of risk, with potentially higher vacancy rates. While Darwin has become much more cosmopolitan in the last decade or so, it has several factors at play that the other capital cities don't have. Those factors make it a riskier investment proposition.
I don't have any property there any more. One of the reasons for that is that generally speaking, the rental yield is not much higher than that in other capital cities while there is still an element of risk in Darwin. I am now investing in Adelaide and very happy doing so.
I have a reasonable knowledge of the mechanics of Darwin investing so would be happy to discuss it further if anyone is interested.
Cheers
K
Hi wannado
I understand that this is all very stressful but for you to successfully sue your solicitor, the courts will want to know exactly what losses you have suffered. Financially, you haven't suffered any loss until the contract falls through, which it hasn't yet. You seem to be getting incredibly stressed over something that hasn't happened yet and you never know, the purchaser may return from holiday and be ready to proceed to sale. Even if the purchaser decides not to proceed on an unconditional contract, you have a legal course of action – suing him for breach of contract.
To be able to claim compensation for emotional stress, you would have to prove that your stress is a direct result of the solicitor's negligence and not for any other reasons. And suing a solicitor would be a very expensive exercise, one that would cost you more than any losses you have incurred to date. You may be able to renegotiate the solicitor's bill when this all concludes though.
My post was really just saying that suing your solicitor isn't really a viable option at this stage for several reasons, namely impracticability and unlikelihood of success. I thought I also gave you some good strategies for trying to get the sale across the line.
K
Darwin has a high rental yield because of the large number of transient workers there. It also has a massive land and housing shortage.
Darwin never came to mind to me when I thought about property until I bought my first property up there in 2004, the day before the market boomed. We bought everything we could get our hands on up there. My husband and I quit our daytime jobs three years later.
Darwin? I can talk about Darwin until the cows come home. Love that city!!
K
A bathroom reno can cost as much or as little as you like. I have done a bathroom reno on an investment property for $1500, but I also recently paid about $70,000 to have a room in our house converted into a bathroom. The IP reno was quite basic (pretty much new tiles and paint and a vanity from an auction house). As to my bathroom, to say is was not a basic reno is a bit of an understatement!
Get quotes from at least three tradies and then look around at auction houses for fittings, tiles etc. And then perhaps look at doing some of the work, such as removing old tiles and repainting yourself.
Cheers
K
For you to be able to sue your solicitor you will have to prove that you suffered loss (financial or otherwise) because of his negligence. What loss have you suffered? How would things have been different if the purchasers had paid the deposit? You can't access a deposit prior to settlement (unless expressly stated in the contract) so it looks to me like the solicitor may have been a bit slack in not getting the deposit, but no real harm has come of it.
The other thing that needs to be considered is when the deposit was payable. Was it payable when the contracts were signed or when it was all unconditional (including the title issue, finances, inspections etc). If it was when the contract was unconditional then based on what you have said above, the title issue hasn't been finalised and the deposit is not yet payable.
As to your options, it depends on what stage the contract is at, If it is unconditional, then technically the purchaser is in breach because the settlement is overdue, You could either take steps to terminate the contract or you could keep the contract on foot and charge penalty interest.
Can you send the documents to wherever the purchasers are to try to expedite settlement? Sometimes it's worth spending a bit of your own money (on courier costs) to get the settlement through.
I'm sorry to say this, but ultimately you are to blame. As I previously said, the failure to pay a deposit (if it was supposed to have been paid) hasn't really affected how the sale has proceeded. Sometimes things take longer than you think they should. When you decided to purchase the new property, you should have had written into the contract that the purchase was subject to the sale of your property. It's a valuable lesson.
As to how to move forward, I think you should stop looking to blame someone and just do whatevery you can to finalise the sale of both properties. Be proactive in getting that last signature. Take a deep breath and a chill pill and call your solicitor to find out exactly where the contract is at and what steps need to be taken. Find out whether the contracts are unconditional and what your options are.
In this market you are better off trying to get this sale through than put the property back on the market and risk not selling it for the price you want. Contact the vendors of the property you are wanting to buy and see if you can get an extension on the time for settling. Be honest about needing another signature from the purchaser and the fact that the purchaser is overseas.
I often get frustrated when things don't progress in a timely manner, But I have learned time and time again that the best way to get people to do things is to ask them "what can I do to help get this matter resolved/", as opposed to ranting and raving and blaming everyone. I have had a bank have funds available 24 hours after finance was approved just because I gave them everything they needed, was polite and helpful and did all the running around for them. The easiest way to get people to help you is to make them want to help you.
Good luck
K
I doubt the ATO could argue that failure to have the landlord's insurance suggests anything untoward by you. Do a search on this forum on property rental disasters and you will soon see just how many people don't have landlord's insurance!
Cheers
K
If you were really opposed to looking into whether you paid the bill or not, you could always ignore the tax invoice and see whether the company follows it up or not. It seems to me that there was some bad accountkeeping in 2007 and someone a bit switched on has taken over the reins and is chasing up unpaid invoices in the hope that some might get paid. The company may not do anything more than just issue the invoices.
Having said that, I am a believer in paying for a good or service that I have received. I would look through the archives and if I hadn't paid it, I would pay it.
Cheers
K
Just to cover yourself, get a rental appraisal from a local property manager and get it in writing. That way you can always prove to the tax office that you were charging market rate. The tax office doesn't like transactions that aren't "arms length".
Cheers
K
It is quite easy to put a caveat on someone's property. I don't think that you need to have an equitable interest in the property. I have placed caveats on someone's property (with their consent) because I loaned them some money.
Please don't consider this as legal advice but I think the way it works is that once a caveat is placed on a property, the owner of the property can issue a notice to the person placing the caveat, letting them know that unless they can justify their caveat in a court, then the caveat will be lifted within a certain timeframe (maybe 28 days?).
The caveat is a legal document as is the notice to remove the caveat, which is a proforma court document. The onus is then on the person placing the caveat to justify to the court why the caveat should remain. This is an expensive process and the person placing the caveat would really need to financially justify going to the Supreme Court to ensure the caveat remains.
So while it is very easy to place a caveat, it is also very simple to remove the caveat, unless the caveat is there for very good reasons. At least thats the way I think it works!
Cheers
K
You are correct in that an unconditional contract means that is is not subject to finance.
Generally speaking, and depending on the state, a contract for sale says that if a purchaser fails to proceed with a contract, they forfeit their 10% deposit. However, some recent court decisions have found that the purchaser only forfeits the deposit they have actually paid. Those cases have very specific circumstances that may or not be similar to yours. Just beware that just because a standard contract may say that the purchaser forfeits a 10% deposit, that may not necessarily be the case.
Your options are as follows:
1. Issue a default under the contract on the basis that the purchaser has failed to settle in time. This gives the purchaser a certain timeframe to remedy the default (ie, settle), failing which you will terminate the contract. The time to remedy the default varies from state to state.
2. Allow the purchaser to continue to find finance and upon settlement, pocket the extra interest incurred.
It might be worthwhile to talk to the REA to find out what the buyer is like, eg, do they appear to be financial. what are the reasons for not being able to get finance etc etc.
If I was in your shoes and I didn't need the settlement money urgently, I would let the purchaser continue to try to find finance for another month or so. If I thought that the purchaser wasn't going to be able to get finance, I would terminate the contract and put it on the market.
Just bear in mind that by the time you terminate, put it back on the market and find another buyer, it may take several months. It may be worthwhile just being patient with the current purchaser for a bit longer.
Cheers
K
Have a look to see if your insurance policy covers flood damage. We had a similar problem with a unit we had years ago.
Under our policy if there was "flood damage" and water from the bathroom was included in that definition, then the insurance company was liable to pay for all "subsequent" damage. Essentially that meant that they wouldn't pay for the structure that held the water, but they would pay for all damage that occurred as a result of the structure breaking.
Initially the insurance company said that they would only pay for the repair of the roof underneath (it was a two story place). That meant that they wouldn't pay for the bathroom repair or the rotting floorboards. However, we mounted an argument that the "structure" that held the water was actually the lining of the shower and that they had to pay for everything that was damaged as a result of the shower lining breaking. Of course, to get to the floorboards, the repairer had to rip out the tiles in the bathroom and replace everything. The company accepted our argument and the authorised repairer had to rip out the whole bathroom to repair the rotting floorboards. We paid for the new shower lining and any new things we wanted in the bathroom (vanity, shower screen etc) and the insurance company paid for everything else. Voila!!
Look at your insurance policy carefully.
Cheers
K
Hi Mark
I agree with TerryW. You cannot go through VISA to cancel the payments. You entered into a contract with Phil Jones' company and signed a direct debit form. VISA are just complying with the form you signed. Any dispute you have is with the company and you will have to take up the issue with them.
The truth is with most of these seminars, everything looks so easy. If it was all that easy then everyone would be doing it. If the company was fraudulent in what it presented then it may be possible to chase up an American agency that you can report the company to. But there is a clear difference between fraud and the company just presenting its' best results.
Given that the company is not Australian I expect that you will have a very difficult time getting any money back from them. However, I suggest you contact them again, pointing out that the forums are no longer available and the promised support is not there. They may just agree to cancel your direct debit.
Once upon a time I was a solicitor. A very common legal saying is that when a client says something like 'it's the principle" or "this goes way beyond money" that's the time to ask the client to put $50,000 into the solicitor's trust account! Fighting for principle is very VERY expensive.
Good luck
K
Hi Mark
I agree with TerryW. You cannot go through VISA to cancel the payments. You entered into a contract with Phil Jones' company and signed a direct debit form. VISA are just complying with the form you signed. Any dispute you have is with the company and you will have to take up the issue with them.
The truth is with most of these seminars, everything looks so easy. If it was all that easy then everyone would be doing it. If the company was fraudulent in what it presented then it may be possible to chase up an American agency that you can report the company to. But there is a clear difference between fraud and the company just presenting its' best results.
Given that the company is not Australian I expect that you will have a very difficult time getting any money back from them. However, I suggest you contact them again, pointing out that the forums are no longer available and the promised support is not there. They may just agree to cancel your direct debit.
Once upon a time I was a solicitor. A very common legal saying is that when a client says something like 'it's the principle" or "this goes way beyond money" that's the time to ask the client to put $50,000 into the solicitor's trust account! Fighting for principle is very VERY expensive.
Good luck
K
Solicitors give legal advice. Surveyors survey the land. As Sonya says, completely different jobs.
Cheers
K
I don't like your chances at all. In short, you can't use the legal system to make someone pay for "being such an asshole". If you were to take the vendor to the small claims court you certainly would not be able to get compensation for lost time and working days. The most you would be able to get would be a court order to turn the files over to you. And I doubt you would get that. The vendor's offer to let you have the files at settlement would not be considered to form part of the contract for the sale of the property as the offer was made after the contract was signed. And it would not be considered a separate contract because there was no "consideration", that is, something you offered him in exchange for the files. His offer would be deemed by the court to be just a nice gesture and nothing legally binding.
You should be able to go to the local Council and get the builder's details and then approach the builder and get plans. Council would have all the permits.
Cheers
K
To have a case against the pest inspector, you would have to be able to prove that the termites were there at the time he/she did the inspection. YOu would have to engage experts to determine how long the termites have been there. And then you would need to engage a solicitor. Work out how much it will cost to repair the termite damage. If it is only a few thousand then I don't think it would be worth pursuing legal action because you would spend at least that much trying to nail the pest inspector. However, if it is going to cost in the tens of thousands, then if I was you I would get some legal advice.
Cheers
K
If the sunset clause has expired and there has been no further agreement to extend it, then it should be a relatively straightforward rescission by your friend. Any law firm that has a property division should be able to handle this. I would recommend that your friend engage a solicitor rather than a conveyancer because generally speaking, conveyancers don't know the law particularly well. Call the Law Society and get a referral from them. They won't recommend a particular solicitor, but they should be able to give a list of firms that have property divisions.
Cheers
K
You should have had a costs agreement sent to you before you engaged the solicitor. Did you get that? Did you agree to a price for the conveyance?
I agree with Scott. If the fee was supposed to be $440 then, unless the solicitor told you that due to extra work his/her fee would be much higher, you should be be able to dispute the extra costs. Call the Law society in whatever state the solicitor is in.
Good luck
K
I know that in the Defence Force the policy wording is such that even purchasing in a trust or company will strip you of the right to subsidised housing. You would have to get legal advice based on the policy wording.
Cheers
K
