Flipping and Access for renovations during settlement

Hi Ben,

I’ve done it extensively in my own portfolio and some of my clients have been comfortable doing it. Under WA law (it may be different where you are) there are two risks to consider;

The first is that the seller is upside down and the bank will not let them settle, you have improved the property and the bank will keep it with out paying you out. This can be common in a falling market.
The other is that the vendor pass away between the offer being accepted and the contract going unconditional. This voids the contract.

A good selling agent will make you sign a condition that you will not make any additional claims once you have possession and will generally try to dissuade the seller from accepting. You would also be wise to insure the property. If you cause a problem and the house were to burn down you will still have to settle.

I have recently collected 3 months rent on one property before settlement (messy divorce where they were playing point scoring) and my previous best was two weeks rent collected before settlement. Both of these properties were renovated before tenanting.

I hope this helps

ben92 wrote:

Thanks for that Jamie, Ill have to speak to my solicitor as well to see what he is able to put in writing.
With thanks, Ben

Let us know how you go Ben – I find a lot of agents/vendors aren’t that keen on access prior to settlement. Unconditional offers with an OK deposit will calm the nerves of some, but it still comes down to the other side what they’ll accept. Good luck!