[Tony BMember@tony-bJoin Date: 2008Post Count: 130]

November 5, 2008 - 12:49 am

Chris

Good to hear you are thinking ratonaly abot the FHO top up. I feel many are just going out and buying on the extra few bucks the Gove has given. When the Gov. lower intrest rates & give out money its for a reasion???

If i get in with the 'extra 7K' will this just be lost due to capital losses? and if the high FHOG drops back down to 7K will my lower priced property then receive much less attention from first home buyers and drop even more (7K)?

An extra 7 k will get you your curtains & a microway oven and a bit left over. So its not a big deal.  Re. you question nobody has the answer. IMO I dont think house prices will race away just because of the FHO top up. A:  Its only for FH buyers.    B: Banks are not lending so much money. C: Job loss is now a concern.  House prices are to expensive. E. Who wants a 25 year sentance just to own your own home, you till have to maintain it, rates etc.

Mate save your money, dont get sucked in to thinking you will make a profit on your home. Negative equity is common.

All the best with your desishion Chris.

T……….

[Tony BMember@tony-bJoin Date: 2008Post Count: 130]

November 4, 2008 - 11:47 am

Lina & Crashy

Yes you know what I think you are right.  I feel that there is something going on. I mean you have the place on the market, a cash buyer walks in and you make so many stories about no paper work from the vendor but want my offer. Take my offer, why , as its not binding.  I dont like going with agents for any business I perfer to talk to the pot not the handle. If I was a vendor I would have the thing the next day for a cash buyer or asap. I dont like going to the vendor but hey they keep telling me its not produced and the people live local.  I will piss the agent off but as my solicitor said you dont have to comply with codes of ethics made my REA. And im not bound by them as Im not making money from the vendor, the agent is.  So I will find out who it belongs to and contact them direct.

Thanks for your input.

[Tony BMember@tony-bJoin Date: 2008Post Count: 130]

November 3, 2008 - 3:41 pm

crashy

Ive got an agent with a house im intrested in. I got on it fast as soon as it went on the market. Its now 4 .5 weeks and no sect. 32 at the office. They have asked me for my offer (make an offer) I told her it would be voild because no sect. 32 is available. After 4 weeks its still the same I go in and "Sorry they have not got it yet from the solicitor" and again its give us your offer & I will ask them.  As you mentioned above  "firstly, ignore anything the agent says. its usually the same old B.S"  I feel as soon as I give my offer with out the sect 32 (its not binding with out the sect 32) they then know what Im willing to pay and may not take it to the vendor as its not in writting and not contractual only verbal.  In spite of asking serveral times over the 4.5 weeks no sect 32. I feel they may be playing me out when the sect 32 arrives (if its not there already ) with another mistery buyer with a higher offer.
Is this somethink you have heard of agent doing?  Any surgestions as to my offer? How long can it take for a sect. 32 ? I know its a very simple situation nothing out of the ordinary sale.
What do you think.

Thanks
Kind regards
T……………….

[Tony BMember@tony-bJoin Date: 2008Post Count: 130]

November 2, 2008 - 2:15 pm

 I think we all find it hard to negotiate with agent & vendors.  Some times the agent is the hard one to negotiate with its not so much the vendor, but thats their job. 

Im finding it hard to negotiate with someone who is already cutting a loss. Any suggestions or tips ??

IMO 2001 was only the start of the boom. So depending on the size, location he may have paid to much for it in the first place.  Its on the market for $299,000 today so forget 2001.  Your concern is  that in 2010 your not putting it on the market for $289,000 same case senario.

At the end of the day IMO if you are only happy, willing to pay 280,000 make a formal written offer. Give the best terms you can 30 day unconditional, if your cashed up 20% deposit. Let the agent know that if you dont get the place you dont care at all. Not everybody is cashed up now & banks are not lending as much out. Who knows you may just get it. I find it hard to neg. with agents so all you can do is make your offer & they take it or leave it.  The agent wont care if its you who buys it or joe blow a month latter. Give it you best shot.

Good Luck
T……………….

[Tony BMember@tony-bJoin Date: 2008Post Count: 130]

November 1, 2008 - 1:02 pm

twas
Great to hear you are doing the Cert4 you can indeed make a good living in this trade and I see alot of young guys doing very well. I think it would be a good idea to get the on the job expiriance first. If you would like to be a part of the build yourself and have a few good mates why not build to lock up. Leave the hard stuff & the stress to the guys who have the know how. Mate you will always find ways to save money once the place is finished. You still have to do the decking, pegola, shed, drive way & landscaping and fencing. Why not have a go at these by yourself you will save a few grand.

Builderbob has correctly expanded on the reality of such a task I have not met an owner builder that have not had difficulty.
Its a faulce economy to owner build IMO. I also think that paying the extra is worth it; If the build goes beond the final date you get paid X amount per week.  If its not done right you tell the company to tell the builder to fix it, simple. The company has a reputation to uphold. Once you have paid Joe and he has left the site he may not want to know about your problems as they are now your problem not his. The process is made easy you use the volume builders existing conections with suplyers. They have color centre etc. to help you choose the right things to make it look right.
Why not use your current skills to be your own inspector at each stage go over the place. 

I would have no problem going with a volume builder of a good reputation and paying 10 20 30 K more just for the piece of mind. Its also a big investment  so you dont want to blow your money 10 years down the track to save 10k now.

All the best with the Cert 4.
 
Cheers
T…………………

[Tony BMember@tony-bJoin Date: 2008Post Count: 130]

October 31, 2008 - 11:35 pm

    Picture this potential owner Builders.  You have an agreement with your carpenter to start on Tuesday the wall fraim and trusts arrive  Monday great so far, however, you get a call from Joe the builder "sorry I can come till friday" now what.   You then find on Friday that half the roof trusts have been stollen. Dont think it does not happen mate Ive seen an old guy about 65 sleeping in his car on site every night to stop things getting stolen.  Public liability, the guy who stole you roof trust comes back to get the copper pipe,or some kids playing on your site, but trips getting over the fence. He then goes to a solicior guess what my friend " see you in the court". 
    Have you ever tried to tell a tradsperson how to do their job. ?!?!?* You will soon find out that you are not in control of the 200,000 you just invested in your dream home. Tradies will "walk off" and of course they want to be paid and as an owner builder you may have to show them the money first.  Have you considered the logistics of this project.  To coordinate the arrival of matterials with trades people is a skill so is neg. the price.  We take alot of things in the "Builder margin" for granted. Sure try to save a few bucks but dont have a mental break down doing it.  If it is so easy to OB why is there so many Volume builders?  A question to you, what if you get 3/4 of the way through the build and then find out , apart from driving you insain, it is going to cost more than the Volume builder or the same price. Alot of the time it will cost you more if not in money in time, stress and quality.

   You have to know your trades people well as once they have finished and been paid (cash) and you have a problem 3 month down the track when the roof guy tells you the fraim is not correct are they going to come back to "help you out". After all you are the project manager/ expert/ superviser and of course the owner Builder.  Being an OB is all about being able to deal with people and that is never easy.   Sorry for the long post but I would not like to see anyone getting ripped off or going into this with out knowing some of the pit falls. Hope it of some help.

I wish you all the best if you decide to OB.

Regards
T……………..

[Tony BMember@tony-bJoin Date: 2008Post Count: 130]

October 25, 2008 - 12:23 am

Crashy
I was always told "cash is king" Ive been in fixed intrest for a long time now yes its safe but you risk the oppertunity cost of your money.  When will the dust settle? What will be the result when it does? 10, 20  30 % reduction in assett value?  I check land prices every day I dont see them going backwards Why?  Bank intrest will fall soon so retunes on T.D. will fall also try getting 8.5 % now.  people who are 100% cash will be the only survivors. Yes comes back to "cash being King" but what about inflation at 5% eg. I get 7.00 % in bank I pay 33% tax inflation at 5.00 % whats left for me.  The economy will have to go ass up real bad before people have no money and property is being given away at 2001 prices. Only my opinion.     Devo 76 I also consided getting back to nature, buying an old place in the bush but your are right it may be best to look for oppertunitys in the current market. How much is my cash worth, banks seem to lend less now so all the greedy vendors may have to wait or take a bit less.
Cheers……………..T

[Tony BMember@tony-bJoin Date: 2008Post Count: 130]

October 20, 2008 - 1:29 pm

Hi all

        I think there are some hard times a head. Im seeing more property on the market at a reduced price. Sure intrest rates are coming down however those that have got in a bit deep want out as the fear of a property crash is in the media every day. Banks are now not leading as much and they are a bit more concered if you can pay it back. Some people are prefering to rent as the damage of the last few years of intrest rate rises has hit home the releif may be too late.  When the Gov. start giving money to people to keep them happy you know the bad news is in the mail. Hopefully we will se housing return to a more realist price and only those who can manage a loan be given one. Rental returns have been very poor and bank intrest a better investment. This is also changing which is a good sign, some better rental retures to show up. Time will tell. This is only my personal opinion.

Cheers

T…………..

[Tony BMember@tony-bJoin Date: 2008Post Count: 130]

October 20, 2008 - 1:14 pm

Paul
I can see you have put a lot of thourght into the conditions of your purchase. This is wise and well done. However, most agents will look at this and since they work for the vendor they most likly will question them.  Terry W  make a good point seek legal advise not from a conveyencer from a solicitor before you sign.  Im not a solicitor but for what its worth,  No1 Is too much detail. What is fair & resonable?? Subject to a  Building and pest report satisfactory to the purchaser.  Simple as that. Paul if you have reservations about the place pay a reputable inspector to check the place out & be there when it is inspected and get the written report. I just went throught this with a friend and it paid for it self as it revealed a lot of things that needed work. Dont forget a conveyencer is not a solicitor so get a legal practitioner that does conveyancing  to check your contract out before you sign. In Vic when you do this you loose your 3 day cooling off period but it may be worth it.

Good Luck.

T…………….

[Tony BMember@tony-bJoin Date: 2008Post Count: 130]

October 15, 2008 - 1:28 am

As expected the new grant of 21k would up set those who have already entred a contract. But look at it this way if I entred a contract  2 month ago I would have only got 12k but I could not find the land.  Last month the builder raised the price of building by 9k I was very disapointed. I had to pay 9k more for the same house. However building costs have gone up a lot even in the last few months. So the new grant just covers the cost increase between building now and a few month ago. My point is you cant have it all your way. I most certainly would be pissed if I signed my contract on the 13th Oct and then found out it was for contracts signed on the 14th oct.  Think about that…….    Lets be happy for those who can use the new grant.

 Cheers
T……………..

[Tony BMember@tony-bJoin Date: 2008Post Count: 130]

October 14, 2008 - 1:08 pm

Dubin-101

I understand totally. With the rate drop of 1% which I could not beleive and now the FHO grant at 21,000 today, can we afford to wait ??????   Wait,  What for ? a further intrest rate cut down to 5%.  I also have missed out on the last 2 properties I offered on. IMPO the Gov. wants to stop the ass falling out of the houseing market, like in the USA and I think Keven Rudds serious about it.
Man its like dangling a carrott, first home buyers will be tempted by the grant & the fear of missing out. The market will be stimulated by this for sure, maybe not much but it may be the diffrence between your offer and the other person that is willing to go a few grand more.  Great if you are the vendor.  Lets hope for the best.

Cheers
T…………….

[Tony BMember@tony-bJoin Date: 2008Post Count: 130]

October 14, 2008 - 9:51 am

Unfortunity there is no FHO grant for a block of land, only a first home. Its applicable to your home purchase, when you entre a contract with a builder.  The first Home Grant is a great thing for first home buyers, a leg up. In fact some buyers would not own there home or get a loan with out it. However, young Invester, dont go out and buy a new home just because its free money. Ever known the Govenment giving you something for free…….  The Rudd Gov.  have to do something to stop the economy from stalling. Homes are over priced simple as that & many people cant afford to live in one any more. So, to ease the burden the Gov. gives a bit more money (enough to do your drive way and plant a bit of lawn). It may help you get a loan but remember you have to have a job next  year to pay it off the the remaining 29 years. 

All the best with you investment or home.

Regards

T…….

[Tony BMember@tony-bJoin Date: 2008Post Count: 130]

October 14, 2008 - 12:14 am

Mister
Great Ocian Rd. nice spot I felt it was only for the rich and then over priced. But Im sure there are some pockets along it that are still good buying. I will continue the search and know if you work hard & do your home work it must pay off.
I will let you know when I hit gold.
Cheers
T…………………

[Tony BMember@tony-bJoin Date: 2008Post Count: 130]

October 13, 2008 - 12:33 am

Mister
Great stuff Im glad you got a good deal. I agree you do have to work to find a bargan and some people dont like to do the hard yards. Mate, I noticed a lot of talk on this site about now being a time of uncertainty and people hanging off buying, the worlds shit about to hit the fan etc.  so it could be agood time to make an offer. Is this true? Good point re. christmas, never thourght of it like that. Man, Ive done the hard yards even put up poster wanting to buy privatly driven round and even door knoked to find out who owns the place next door. I may be expecting to much of a bargain but I beleive what you said you need to get it cheap now as we dont know what will happen in the near future, need that profit buffer. I beleive you make your money on property when you buy it not when you sell it.  Im also concerned about rate drops it may start a buying spree again, share prices dropping and people starting to look for a safer place for supper. Dont know your oppinion on these points.

I can be a tight ass and like to point out the negatives to the agent and vendor but only to out smart myself when some one elles whats the property more than me. However, the next few months may see a differance. I hope a bargain comes my way soon. By the way what state did you buy in?

Cheers
T…………..

[Tony BMember@tony-bJoin Date: 2008Post Count: 130]

October 12, 2008 - 11:08 am

Having spent many a weekend an Mortgagee Sales Im yet to find one thats a real bargan. They tend to attract all bargan hunters and some times are sold above current market value. The lenders main aim is to recoupe what is owed. However, as mentioned they have a legal obligation to get the max and what is fair market value. If a person owes 100k and cant pay dont think you may buy it for 100k the person can sue the lender for selling there house under market value. A lot of these houses Ive seen are in bad shape due to the owners lack of upkeep some have been trashed. Its a bit sad to see people over comitted, mislead then tipped out. Some of the no doc lenders will have you out in 4 weeks and on the market as fast.

The agent will in most case be told the reserve on the day, if not when the biding stalls. They may neg. a bit if you are the only bidder but not much. Some have been auctioned 2 or 3 times the last time being the best to buy at.

Most Always sold by auction the auction rules apply, no cooling off etc. What you see is what you get. As mentioned if its passed in it will go in the window of the agent at a fixed price. They dont give them away (not yet anyway).

If you intend to buy at a mortgagee sale think about the following:

Get the sect 32 asap then get it to your solicitor.

Have a good look at the place most times the power, gas, water will be off so you cant check if things work. 

Have a cover note ready for insurance from the date you bid. Remember you are buying some poor bastards place that just got kicked out.

Have a set price and stick to it (as some ive seen sell for more than or near to build price).

You may pick up a bargan and you may not, I got sick of going to these sales as I felt they were not a bargan.
Hope Ive helped a bit.
Good luck.
T……………..

[Tony BMember@tony-bJoin Date: 2008Post Count: 130]

October 10, 2008 - 1:51 am

Hi
I agree with Chris. I have a deposit with a builder since April there has been 4 price rises to about 15k plus the land price increase. My figures showed me it was cheaper to build but now if you look around you will find a place the same 2 or 3 years old for less. As to blocks of land in the country my friend they may be cheap but the cost of building in the bush in more about 5% more. Also people dont want to live in a place with no jobs. Try selling it……  You can do money on a block easy, you have to hold it for 5 year to make it worth while.  Think before you buy sorry to say it mate but Location Location Location……
All the best

T…………………

[Tony BMember@tony-bJoin Date: 2008Post Count: 130]

October 10, 2008 - 1:43 am

Hi Oppertunity

I think your main concern is the near 1 million debt. I also think you are basing your desision on saving on the holding costs too much. You want to build in order to reduce your holding costs. ie Borrow another 5ook in order to save 13,000 pa on holding costs. My question is before you brought this place did you realise the true holding costs (18000) ? Also consider the impact on your current life style paying off an extra 500K.  How old will you be before you have any equity in the place?  If and I say If propery prices fall what will be the situation. I feel your holding cost are very expencive and you now realise this going in bebt to 1 mill. in the current economic climate may be somthing you may regreat. Just some food for thourght. All the best with your desishion.

Cheers

T………… 

[Tony BMember@tony-bJoin Date: 2008Post Count: 130]

October 9, 2008 - 1:16 pm

Mister & others
I totally agree with John re. discounts on listed prices. I may add I found out the hard way.  Two offers I made on property I really liked, both cash & unconditional but with a 15% off listed price got sold for listed price. I now start again to look for another , may take 3 or 4 months to find a suitable investment.

I also was under the opinion vendors would consider offers discounted by 20% or 30% but in most cases they will not. Agents want to sell the place so they try to advise the vendor realistic prices, in most cases anyway.

Mister, from my expiriance think about this, you find a good place which has the potential to make you some money, a safe bet in a good location. You then play hard ball with a low offer, and keep in mind a vendor dose not have to make you a counter offer, then I come along and like the place also and offer a few K under list price, its now sold.

When making an offer IMPO one should do it in writting on a contract note of contract.  If you want to discount use your terms as best you can, 30 days or less, cash no finance, 10 or 20 % deposit in 24 hours after the vendor signs. Offer to expire in 2 or 3 days. Most vendors dont like to be pushed, they may talk it over with family etc. I give 2 full days for my offer to expire. If you dont put this you may find as you have that the agent will wait for more offers to come in.  But be realistic in you offer unless you are happy to walk away.

Also please consider, if the vendor is so keen to drop the price Why?     Are all the properties in the area over priced and now falling and will they continue after I purchase?    You may get a cheap place but  if its a bargain you only find out latter. You also may have to discount the price when you go to sell  in the future.  If you make a low offer most  agents will say they will give your offer to the vendor over the phone, most likly they will tell you the vendor said no. The vendor may not even get the offer because its too low and the agent does not want the embarisment. Get your offer in writing so they have to take it to the vendor. By the way dont contact the vendor direct even if the agent is taking too long. Work with them not againt them, even if you have to push & hassle the sh*t out of the agent, its best.  Let us know how your offer turned out.

Best of luck with you offer

T………..

[Tony BMember@tony-bJoin Date: 2008Post Count: 130]

October 7, 2008 - 2:42 am

Macnatt
I dont think you need to worry about selling your house for 250k just yet. However, welcome to the realality of your current investments. Top end market property is not the place to start, to much to loose if things go wrong.

" My feeling is maybe we should cut our losses and offload this property as it is beoming a financial drain and we are starting to feel as though we are funding the lifestyle of our tenants."

What, as opposed to the tenant funding your lifestyle. Mate, you wanted to be the land lord and now your begruging the tenant of there enjoyment of the property just because your not getting rich as fast as you thourght you would.

You know you are loosing money,   " I originally subscribed to the buy and hold strategy but surely there comes a time to cut losses."

If you could not afford to hold, why did you buy. What went wrong with your "original strategy".  In my opinion far too many people (investers) have been driven by the faulce beleif that they will make a shit load of money when they sell.  Now, quiet a few of them feel that potentual buyers should fund there poor investment desishions by paying what the property owes them and not what it is worth in the current market or what buyers are willing to pay.  Again, as you said it only take one person to pay what you want and its sold. Recenty Ive made a few low ball offers for property I thourght was over priced and it was sold for the listed price. So dont get to stress out just yet. However, you are loosing far to much money in a falling market and you are uncomfortable in this investment so why not sell for as much as you can get and move on.

All the best Nat.
T…………………

[Tony BMember@tony-bJoin Date: 2008Post Count: 130]

September 22, 2008 - 3:33 am

Peter

Thank you kindly for your reply.   May I say your site has proven to be a great resource for me, in the past and now.   May I also say I have learnt so much and beleive your site is a must to visit before entering an agents office. 
 
What supprises me is most agents know as much law as I, very little. They asume the potential purchaser in fact knows nothing of contracts or realestate law, and in the majority of case its true. However, they like to take advantage of this. On a few occashions I have had to corrected an agent on a few points and wow how their attitude changes & not for the best.

I think it is a great step foward in banning the Contract Note. Why would you want them anyway, the vendor has already paid for the sect 32 & contract to be made up by a proffeshional to their satifaction.  I contacted the agent and asked for a contract as I have the sect 32, But no contract, suprise suprise. I was told I would be emailed a Contract Note as no contract had been prepared. After reading your last artical I now know it by its correct name "contract switching".  Today I received nothing at all as I asked for the contract not a note. 

If I can  ask you a few questions:
Can a real estate agent prepare sect 32s and contracts legally for a vendor?
If I want to see a contract and am told its not available and am given a note to make my offer what can I do about it?

Once again thank you for your reply and keep up the good work.

Kind regards

T……………….