Hi all,
Im reaaallly hoping to get some assistance, maybe 'creative' assistance is the word for it!
We bought a block in Nov-09, with a condition to build within 12 months, it was secured
against my partners unit (he owns about 75% of this unit). We are waiting for him to secure
work, wait the probationary period of 3 months then apply for a construction loan.I have since discovered that the block next door is available for sale and I have put it
on hold, ready to put a minimum deposit this Sunday, with the view of building a house
for my mum later. The eventual sale of her unit would fund most of the land and construction,
though she's old school and has to 'see it in front of her', so talking conceptual stuff is
not her thing. A shame because she stands to pay more stamp duty for an existing home.I have a property I bought a year ago which has already proven a good deal with equity,
probably around 17% equity already. It is currently not secured to anything and I stand,
at this point to make around $45K clear if I sell it now, which is something Ide rather not do
as I like the place.I have been told that for mum to save money on stamp duty, it would be best to joint-sign
the second block this Sunday. I dont think she is convinced, as it would involve splitting up her
proceeds and living somewhere else (all very complicated for a 60 year old).As we have to build on the first block soon, we can either build a cheap plan for mum and
jointly sell to her when it's finished OR jointly purchase the second block with her with a
view of building much later. I could use my villa to secure the second block but then I might need
it to secure the construction….God I dont know, I REALLY NEED ADVICE!!!!!CAN ANYONE HELP ASAP???? IT WOULD BE MUCH APPRECIATED!!!!!
Miss Proulx
ps: I reckon Custodian Wealthbuilders rock. Will be attending seminar shortly.
"ps: I reckon Custodian Wealthbuilders rock. Will be attending seminar shortly."
Why not u asked John Fitzgerald in the next meeting?
Well I hung myself a noose with that one, didnt I??? hee hee
I really need the input of all the brilliant $$$$ brains that log on to this site
and hopefully a response in the next few days….Probably will have to drop the whole thing, it's a great opportunity to keep
the family together but too complicated and stressful….Anyone else with any helpful feedback out there????
Miss Proulx
The block next door is available for sale – is it on the open market? Why is it being sold? I wonder if you could instead just get an option on it? Then worry about exercising your right to buy it later? Maybe a couple of thousand dollars option fee would be enough for the vendor to keep it off the open market for a while?
Otherwise, maybe try and negotiate a really long settlement? So delay the bit where you have to pay money?
Otherwise, will the vendor consider vendor financing? ie they loan you some or all of the money for the block in return for a high interest rate of repayment.
Jacqui Middleton | Middleton Buyers Advocates
http://www.middletonbuyersadvocates.com.au
Email Me | Phone MeVIC Buyers' Agents for investors, home buyers & SMSFs.
Sounds like you are jumping into something without enough time to fully understand the implications. I would suggest you try for more time and then see a lawyer and run through it all. stampd duty, CGT and centrelink etc implications
Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
http://www.Structuring.com.au
Email MeLawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au
Hi JacM, yes it is on the open market but it has been held via a verbal agreement by the vendor, one of the known builders had it on hold a few times and financing fell through more than once – we lined up for our block in September (new release in a new estate) and since then I assumed all the blocks were gone, then this one appears and its the last one on the street. Yes I am planning a long settlement and putting down $1000, subject to 21 or 28 days finance…I dont know if they will accept that offer. Regarding 'Option Fee' could you please clarify what you mean, is that the deposit (like when you sign a lease agreement, they have an option fee that is non-refundable if you pull out?).
Hi Terryw, yes I agree I need more time, the 'subject to financial approval' will give me another 21 or 28 days, I just wanted to be more prepared before the initial deposit this weekend.
I dont know anything about vendor financing, I will check that out JacM, thank you so much for your advice, much appreciated.
Miss Proulx
No an option fee is not as you described. You would basically need to say "Sorry, I don't want to buy this land at the moment, but I might in the future. Will you sell me an option to purchase it later if I feel like it? My solicitor could do the documentation." You'll need to research options a bit more and ask a solicitor how much it would cost to draw up such a contact, if in fact the vendor was prepared to be creative.
Jacqui Middleton | Middleton Buyers Advocates
http://www.middletonbuyersadvocates.com.au
Email Me | Phone MeVIC Buyers' Agents for investors, home buyers & SMSFs.
An option is a separate contract. The terms can vary greatly, but you would basically pay a small premium, the option fee, and this would give you the right, but not the obligation to purchase the property during the period of the option. During this time they cannot sell the property to anyone else (you have the right to lodge a caveat too) and they must sell it to you as per the terms agreed upon. Its good for the buyer as they can tie up the property while doing further checks etc, and it is good for the seller as they get to keep the premium if you do not go ahead.
Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
http://www.Structuring.com.au
Email MeLawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au
Im wondering if PEET do this, but for now I have given up and cancelled the hold on the property.
The situation was complicated because we must initiate building on our own first block in the next
few months, so that construction loan has to come before a loan for another block.Very disappointed, but will still investigate the arrangement you mention – perhaps one of the
reputable builders in the area could purchase the block and build on it, and maybe offer it to me
in the first instance when it is ready, before putting it on the open market.Thanks again Terry, if you can post privately to me to supply further contact details, that would be great.
Regards
Miss ProulxsTake out an owner builders licence, start work then cease. You have then complied by commencing work.
Happy to talk through your situation and offer any help if you are still considering your options??
Given the number of options you have available to you it might be worth a 'chat'… give me an email on [email protected] and we can work through the details..
Jodie
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