Hi,
We're thinking of buying interstate in QLD, and were going to go there for a few weeks to look for something and buy something that needed just cosmetic renos to get it up to scratch.
I was just wondering, after contract is signed and building and pest inspection done, how soon can you get access to a property. I know there is a settlement period, although read somewhere that you can get early access sometimes.
Does anyone have any info on this. not sure what the steps would be as we wanted to sign contract, do the renovations while in QLD (partner is a builder), then organise to be rented out.
any info is greatly appreciated
You can get early access if it's agreed to by the vendors.
Ask your solicitor to work it into the contract.
There are some risks with this approach – such as settlement not occurring and you've already commenced work. However, there are obvious benefits as well and I've used this strategy a couple of times and it's worked out great.
Cheers
Jamie
Jamie Moore | Pass Go Home Loans Pty Ltd
http://www.passgo.com.au
Email Me | Phone MeMortgage Broker assisting clients Australia wide Email: [email protected]
Hi Rachste,
as Jamie M has commented that your solicitor will have write this up in the contract & vendor will have to agree on it. Most times it can work out your favour in regards to controlling the property not owning & still conducting the work that is required to complete which can have a big saving in regards to holding cost. If you have any framers please let me know & I can give further info for you.
regards
Lefty
Early access,
Many sellers don't agree to this for a few reasons 1 being insurances (public liability etc), what if you hurt yourself while conducting work at the property? You're not legally the owner during this period, who pays for this?
If the seller is happy for you to gain early entry, your solicitor can make this an extension to the contract given this is already signed.
Happy reno's
In regard to insurances etc. I always thought that once you sign the contract to buy it you are then liable to insure it etc?
I done this last month. I signed a license agreement which states what ever happens I’m liable. It didn’t cost me anything to set up, but the vendor needs to agree to it.
Also, you must start paying rates, water, etc from date of contract not settlement.
jmsrachel wrote:Also, you must start paying rates, water, etc from date of contract not settlement.Not MUST. I'd say can. Depends if the vendor asks for it.
I just got early access. Paid rates etc from settlement. They even left the electricity on until settlement as they were coming and going moving stuff out.
I always get insurance as soon as cooling off finishes. If the vendor doesn't have insurance yours will kick in. Better to be safe I say.
Having to take out insurance prior to settlement is a Qld thing. Not the done thing in NSW>
Catalyst wrote:jmsrachel wrote:Also, you must start paying rates, water, etc from date of contract not settlement.Not MUST. I'd say can. Depends if the vendor asks for it.
I just got early access. Paid rates etc from settlement. They even left the electricity on until settlement as they were coming and going moving stuff out.
I always get insurance as soon as cooling off finishes. If the vendor doesn't have insurance yours will kick in. Better to be safe I say.
You must have had very lovely vendors letting you use there water and electricity! Mine were stingy.
Scott No Mates wrote:Having to take out insurance prior to settlement is a Qld thing. Not the done thing in NSW>My solicitor recommends it (in NSW) as a safeguard really. If the house burns down and the vendor has no insurance there will be issues with settlement. You won't want to settle, they will, lawyers make lots of money.
jmsrachel. Yes they are a lovely family. It was their dad's house. They were happy we loved it and are moving into it. They were even still planting veges in the garden months after it was listed for sale. Even after exchange they still watered and weeded the garden etc. Rare indeed.
Never been advised to do it – I may have an equitable interest in the property but until full restitution is made (or a massive price adjustment provided) there'd be no way I would be able to settle – 1) bank would pull finance 2) my insurer would not pay out on something that I didn't own 3) property is not in the same condition as when inspected and contract agreed
Scott No Mates wrote:Never been advised to do it – I may have an equitable interest in the property but until full restitution is made (or a massive price adjustment provided) there'd be no way I would be able to settle – 1) bank would pull finance 2) my insurer would not pay out on something that I didn't own 3) property is not in the same condition as when inspected and contract agreedAnd so begins the battle to get your 10% back.
And insurance WILL pay if it is not insured by the owner as you have a vested interest in the property.
If I want the property for the sake of building insurance for 5 weeks ($60?) I'd rather have it.
You really want to have insurance on the property from the moment the cooling off period is over. If the vendor does not have insurance, and the house burns down, you are still committed to buying (unless there is some special condition that gets you out of it).
Can't say I would be wanting to gain early access to make improvements on a property prior to the finance clause being ticked off… it would not do if you whack in a new kitchen and carpets and then your bank says no, we will not be offerring you finance on this property.
Jacqui Middleton | Middleton Buyers Advocates
http://www.middletonbuyersadvocates.com.au
Email Me | Phone MeVIC Buyers' Agents for investors, home buyers & SMSFs.
Hi Nathan
In Qld you are required to affect Buildings Insurance on the property at the time of the Contract being executed however this is totally different to Public Liability Cover.
We normally try and obtain access after going unconditional but you have to ensure that the Special Conditions in your purchase contract allow for this. Hard to put into practice when the owners are still living in the property and if so you are probably going to be limited to access for surveyors, architects and other licensed tradesman.
Of course if you agree to release the deposit to the Vendor on going unconditional that can often sweeten the deal.
Agents dont like it because they like to hold it in their Trust Account to cover their commission.
Cheers
Yours in Finance
Richard Taylor | Australia's leading private lender
Thanks Richard,
A property I am currently looking at is vacant and needs some minor reno's however I am completely new to the whole early access thing. I think this would be ideal for this property! So really you are best not to gain access until it is unconditional? Or at least not commence work until it is unconditional I guess?
If you had commenced work and it fell through then you would be required to restore everything to the way it was or better?
Cheers,
We gave early access to purchasers on a property we were selling in Adelaide a few years ago. It allowed the purchasers to arrange for trades to get in and reno the place before settlement.
The day before settlement they notified our solicitor that the smoke alarm was damaged and we had to repair it otherwise they would delay settlement and report us to the authorities for not meeting the legal requirement in SA.
The smoke alarm was working before they started the work as we had it tested, so obviously the painter had broken it. No matter how much the real estate agent tried to get them to see reason they refused to budge.
The real estate agent in frustration rushed out and purchased a battery one from Bunnings and put it up … it cost $50. We couldn't believe the cheek of these people, … we gave them early access and saved them $1,000-$1500 and they pulled this stunt.
We have been asked again on another sale, but this time we just refused …. once bitten and all that.
Mystery
To avoid the issues Mystery suffered from his sale in Adelaide i would be putting a condition in the Contract saying that when the purchaser enters the property to start work etc they also accept the property in an As Is condition to avoid any pre-settlement issues.
Cheers
Yours in Finance
.
Richard Taylor | Australia's leading private lender
I am in the process of purchasing a property and it settles next week. It was a condition of my bank loan that I had to take out building Insurance or my loan wouldnt be approved. I am in New South Wales.
You must be logged in to reply to this topic. If you don't have an account, you can register here.
