Buying the neighbour's house

[Simon]

Of course they are asking for a top price. This is how negotiations run and they know you are interested.

My advice for you to consider is this. Give them a written offer of what you think it is worth and then do nothing. Seems that time and patience is on your side with this one

After a while when they feel they have no choices they may very well come and accept it. Even for them to walk out with $10K after they sell might be a better option to have it taken from them and then get whatever is left - at least they get to stay in control. Sometimes pride is still a tangible to some folks.

As in all low offers - be prepared to lose it to a higher bidder though.

All the best,

 

[Jacque]

Knowing that my boyfriend paid $211,950 for his rundown 3br house on 550sqm block next door, and there are two houses in similar condition up the street asking around the $239,000 mark, WHY does he think i will pay $260,000 for his 3br house on a 550sqm block...It is not in rentable condition right now and would take some significant work to bring it up to a minimum standard. I plan to live in whatever house i buy for 6 months, and then rent it out.

I know that they paid $215,000 for it in 2002. They have basically trashed the place. His sons have punched holes in the walls of the house and one of his sons who lives in the garage has pulled down all of the fibro off the walls of the garage Their elderly neighbour on the other side said the house was in good condition prior to them purchasing the house and moving in.

The house basically isn't worth anything, it's just the land i am interested in. A 550sqm block across the road is currently going for $199,000.

An independent valuation would be wise here, in that you could pay for it, discuss the recent sales (your boyfriend's house being the best and most recent by the looks of it) with the valuer and then present the valuation to your neighbour, with a written offer. It also appears that the neighbour requires some "educating" about the true value of his home.
Though I don't know the vicinity of the property, I would assume that it was purchased late in '02, during the boom, and now is worth less than what the neighbours originally paid. That's tough, but that happens when home owners have to sell in the down period of a property cycle. There are countless examples of this here in my region, with properties purchased in '03 now being marketed for less than what the owners paid.
From the information you've given, one would assume then that the house would be worth no more than your boyfriend's. However, you could point out to the owner that you are helping him out, after all, with no agent fees, no open houses (and it sounds like they wouldn't go well anyway!) and no more mounting bank and legal fees.
I trust they have no plans to wish to stay on as tenants? Or has this subject not been breached?
They don't sound as though they have many options at this stage.
Be firm on your offer and, if they end up having to sell as mortgagees through a REA, you might even have a better chance....
Keep us posted regardless and good luck!
I can only imagine the grief and stress of living next door to these people- you have my sympathy and I really hope something happens to improve it soon

 

[MarkR]

Interesting situation - One thing that hasn't come up is what happens if they decide you're to blame for not buying their house at the price they want/need !

I'm not sure if I'd be too keen to give a bunch of undesirables like that a reason (no matter how false) to start blaming you for their situation & turn it into a vendetta against you. I'd be keeping them at arms length ("sorry bank won't lend me the money now") & waiting for the bank to foreclose & kick them out. Then deal with a more reasonable party (the company the bank will use to sell the property, most banks don't sell their own foreclosures) who won't hold grudges if the deal falls through. If they're asking for $260 when comps are going for $230 could be a negotiation technique, or could be a desperate attempt to walk out with some money & desperate people can be extremely unreasonable.

Maybe I'm being paranoid but I'd be adopting an arms length approach with these people that way nothing can come back to bite you.

Cheers & Good Luck
Mark

 

[lizzie]

re solicitor ... give garry a call. he is a very genuine guy who, if he believes the best course of action for yourself would be with a solicitor, he will not hesitate to tell you. he has an intergrity of person i have yet to see bettered.

on top of that - he really, really, really knows his stuff and can also arrange pest and building reports, survey reports or whatever is required at no extra charge above the cost of the supplied service.

 

[Sultan of Swing]

4/ If you're concerned about the 'real' value, get a valuation done. This can be a great negotiating tool.

another story ( I love these ) .....

A few years back I had a property listed at $240,000. It was and I personally believe still is one of the best five houses in town. I look at as I drive past and it makes me smile, its so aesthetically pleasing.

Back then, I'd only ever sold ONE house over $200,000. Only two or three had ever sold over the 200k mark.

Well, I had a buyer who wanted it but I think (or he led me to believe) that finance was tight and was borrowing 90 or 95%. He had a registered valuation done and then offered 200k for the property. I presented the offer to the vendor and he laughed at it.

I then went back to the buyer and he showed me the valuation, 200 - 210k. He gave me a copy to show the vendor and upped his offer to 210k. That was fantastic leverage for the buyer.

I showed the vendor and it sort of wiped the smile off his face a bit and I could hear the cogs turning in his head. He said to leave it with him overnight.

That night he phone a valuer friend of his and the valuer said, if you want to sell, take it and to cut a long story short, he did and everyone lived happily ever after!! (Especially the salesman cos he THOUGHT he was a super negotiator )

Really though, I learned a lot from that buyer and its stuck in my mind ever since.

Cheers

Hi Mishmash

This is something I posted a while back and rather than retyping it I thought I’d quote myself.

I think it may be relevant to your situation although it may not as it sounds as if you're dealing with irrational people.

Cheers

 

[MishMash]

Thanks for the input, everyone.

My boyfriend went over there this afternoon and explained that i was unable to get finance above $225,000 (which is the truth!). The neighbour then said he would accept $230,000 i was very surprised that he dropped this far just a couple of hours after saying he wanted $260,000. Boyfriend told the neighbour we were looking at some other houses also and we would let him know our position in a few days.

The house five house up, same block size and also 3br, i had a look today and while there are a few issues, i would easily be able to rent it out as it has been looked after well. They have it advertised for $245,000 and i offered $215,000. The agent rang back and said that the wife needs to speak to her husband but she didn't turn it down..how strange as i was expecting them to tell me to bugger off with such a low offer.

MarkR, i agree with what you are saying because i know that they (particularly the husband) are quite unstable!! I have made no promises and will decide whether to proceed with a formal offer after speaking to the development staff at work and exploring what possible options boyfriend and i might have in the future with regards to develop of our adjoining properties. If i can't ever do anything with it, and if a pest and building report came back completly unfavourable, then i will not proceed and my excuse will be that the bank knocked back my loan!

 

[skater]

I don't know the area you are talking about, but if it is Sydney, at those prices, my guess is out West. If this is the case, I know the area well as I have quite a few out there.

From what you have said about the condition of the house, I would be inclined to offer around $180k. They won't like that of course, but you have to take into account the state of the place & what it will cost to repair & bring up to scratch.

If it is on a corner & is 550sqm, you won't be able to subidivide (if it is the council I think it must be in), however if you combine it with that of your boyfriend, you should be able to put at least 3 single dwellings there. I'm not sure about townhouses. A corner block must be 600sqm to divide into two, so you will need to grab at least 50sqm from the adjoining block.

 

[Graham.B]

I know that they definitely do own the house. I work for the local govt authority and have checked!

MishMash,

I am stunned!!!!

Sincerely

Graham

 

[nursers]

I know that they definitely do own the house. I work for the local govt authority and have checked!

You realise this breaches Federal Privacy regulations and potentially your employment contract if there is a privacy component?

Regards

David

 

[Simon]

This info is in the public domain.

I can get it easily enough too.

Cheers,

 

[nursers]

This info is in the public domain.

I can get it easily enough too.

Cheers,

That it might be, the mistake made was alluding to using one's work role to advantage. Most workplaces have browsing data policies that expressly forbid this. Just a point

 

[Simon]

That it might be, the mistake made was alluding to using one's work role to advantage. Most workplaces have browsing data policies that expressly forbid this. Just a point

Fair enough. She probably pinches pens too

 

[Spectre]

Mish & Simon brings up an interesting point though. This will probably come out like I'm a fwit but in a similar vein....

I've had a few properties where I've rung up the bris council, told them I'm looking at buying a property at 123 xyz st and they will offer up what the rates are, lot and rp, if rates are in arrears etc etc etc.

I'll then get my solicitor or the bank guy to do a serach on it to look for other covenants etc and move from there. I dont see too much problem with doing this as if the council lets you or if your solicitor is going to find out anyway....

So, i figure if the council lets you do it or if your solicitor can do a check on it, and you can do it for and not get charged 'professional fees' (or even if you do) then the assumption of privacy is out the window.

Regards
L

 

[beech]

Go for it MishMash,

the info that is,your just being Pro-Active.

We all would have done it.Well except for 2.

 

[MishMash]

You realise this breaches Federal Privacy regulations and potentially your employment contract if there is a privacy component?

Regards

David

I put in a complaint against the owners of the property (our neighbours) due to the excessive noise and this is how is how i found out who the owners were. This was just after we moved in (over 6 weeks ago) and i have only considered buying their house in the last week.

 

[Graham.B]

Go for it MishMash,

the info that is,your just being Pro-Active.

We all would have done it.Well except for 2.

Beech,

You are so wrong!

It saddens me the people in the world who believe NOT doing the right thing is somehow okay.

Could I suggest you search out the "Prisoners Dilemma", read through the principles it is founded upon and play it and see what happens and whether it gives rise to some doubt in your mind on the stance you have taken.

Lawlink info on privacy laws

Regards

Graham

 

[beech]

Lighten up GB.

 

[Simon]

I put in a complaint against the owners of the property (our neighbours) due to the excessive noise and this is how is how i found out who the owners were. This was just after we moved in (over 6 weeks ago) and i have only considered buying their house in the last week.

Sounds pretty reasonable to me - I hope the folks who so quickly jumped to conclusions can apologise.

There is always two sides to every story.

Me - I am sorry about the pen crack

Cheers,

 

[Spectre]

I look at it from the view that if you are going to be spending $200000+ on an investment, you want to make sure you arent getting into something which might be a flopper.

Doesnt matter if it is property or managed funds or stocks, but at the end of the day in my view the guy who is selling the property isnt going to tell you all of its shortcomings.

Point being there is probably a fine line between peoples presumed expectations of privacy, which interestingly enough you can get online and order a check on people as long as you have their name and address, and you can get thier bank account details, assets and debts and so on for $29.99 vs making sure you are getting into a safe investment by your available resources.

I'd be sure that i've gone thru a forums which encourage checking out a property thoroughly, which include sitting outside it at different times to see what the noise is like, neighbours etc etc...

As I said before, its an interesting debate - end of the day noone wants to pay too much for a property and often ethics are limited by the almighty dollar.

Regards
L

 

[willair]

I put in a complaint against the owners of the property (our neighbours) due to the excessive noise and this is how is how i found out who the owners were. This was just after we moved in (over 6 weeks ago) and i have only considered buying their house in the last week.

MishMash,
I hope you understand that in life its a 2 way street,your neighbours
will know you are the person that made the complaint,and as you
intend to to try and buy this property,you will already have them
off side towards you.I have experienced what will happen when
when you mix a persons personal privacy when someone trys to
find out who you are be VERY carefull when you start looking
at another persons affairs..what goes around comes around
and when you least expect it..........
willair.........