Hi All
Wondering if anyone has bought or about to buy a IP on their terms with minimum or no deposit.
Are the vendors flexible on terms?
Anyone made an offer which was much below asking price but still accepted by the vendor.
In current market conditions what discount should one ask for 10-15% or less?
Has anyone bought an IP with no deposit or cash outlay excluding equity.
More questions as they arise
Have a nice weekend
Free?
Buy land heard they dont make them anymore
Hi free
In the current slow market we have found it easy to buy at a deep discount, with our purchase costs paid by the vendor and with terms from the vendor. Recently we've bought properties using the following techniques:
- The property started at $299,000. We bought it for $235,000 and, at the settlement table, the vendor gave us a $5,000 cheque made out to the Office of State Revenue to help pay our Stamp duty costs.
- The property started at $365,000. We bought it for $320,000. At settlement we paid the vendor $256,000 (80%) and they carried back $64,000 (20%) over 5 years with no interest. We pay the vendor $420 per month but it comes off the principal, i.e. we will make a balloon payment of $37,000 in 5 years. We still had to pay Stamp Duty and Legals
- A home owner suffering serious mortgage stress (default) came to us facing a mortgagee auction. They had $260,000 equity in the property and were very worried that they'd lose all their equity during the mortgagee sale process. We have entered into a JV with them, to save their equity and have sold the property with an Instalment Contract with good fixed capital gain and positive monthly cash flow.
When negotiating on property we recognise there are two areas that are flexible, i.e. price and terms. We usually work on the basis that, if you can get a good deal on one of these points, it's then quite difficult to get movement in the other, i.e. if we get great terms, we understand we won't get much movement on price and vice versa.
Keep thinking outside the box
Cheers, Paul
Paul Dobson | Vendor Finance Institute
http://www.vendorfinanceinstitute.com.au
Email Me | Phone MeAn alternative way to finance your home.
Saw a couple of local sales of late go at a reasonable discount either due to desperation or agent pressure: 2 knock-downs in the same street sold for $100-150k below market appraisal about 10%, another last week on $120k discount and yet another about $175k off. Sure, all these properties are worth $1m+ but even this end of the market is tightening its belt.
"this" market???
Which one would that be? Or are you assuming ALL of Australia is exactly the same?
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