Buying Wholesale

[WebBoard]

From: Mike .


Can someone define
From: Curious Onlooker
Date: 26 Oct 2000
Time: 19:06:33

just exactly what's meant by buying "wholesale", and/or "less than market"?

Is this from the developer?

If so, wouldn't any new developments provide an excess in that micro-socioeconimic area, making on-sales difficult?

If not from the developer, then how are properties purchases for less than valuation?

Curious ...

 

[WebBoard]

Peter L

Reply: 1
From: Mike .


Re: Can someone define
From: PETER.L
Date: 27 Oct 2000
Time: 07:23:21

[How are properties purchased below market value]

These elusive properties are out there but you need to do a lot of looking and research.

1) Concentrate only on 1-2 suburbs.

2) Get to know your prices for those suburbs- get a list of all past sales. You can contact the REI, vic, nsw,sa.qld,wa. Contact Age or Syney Morning Herald for past auction results. -use the Age or Sydney Morning Hearald past auction results fax service -attend as many open for inspections and auctions as possible.

3) Then you need to keep records of previous s,sb and PI. Use rp data, residex or info from the auditor generals office.

All the information that you gather will let you know what the market is prepared to pay, which puts you in a position of power. You know now how much you should pay to purchase under market value.

4) Send faxes to all the estate agents stating you have cash ready now and you only want to purchase wholesale. They will know what you mean.

And for your peace of mind ask the valuer to value your property before you purchase it. This will reassure you that it is definitely wholesale and will let you know how much immediate equity you will have.

 

[WebBoard]

Michael Gruber

Reply: 1.1
From: Mike .


Re: Can someone define
From: Michael Gruber
Date: 26 Oct 2000
Time: 23:42:06

Hi,

I recently attended the Henry Kaye seminar.

Wholesale as defined by Mr Kaye is purchasing below market value.

You do you due dilligence and determine the fair value of a property, then negotiate a price lower than what the market values this for.

Note market or "retail" value will normally include the developer's profit margin. This is the margin you play with.

So your zone is above "cost" and below "market".

Things that can influence the developer or event vendor of 2nd hand homes could be;

- financial pressure to make the sale
- the need to sell asap
- fear of negative market movements

Stuff like that. The more knowledge you acquire the better your position to negotiate.

Regards Michael

 

[WebBoard]

Curious Onlooker

Reply: 1.1.1
From: Mike .


Thank [Re: Can someone define]
From: Curious Onlooker
Date: 27 Oct 2000
Time: 00:30:15

At what stage of construction would you consider an "off-the-plan" purchase -- to trade-off settlement and likelihood of buying below, while still allowing for growth before settlement?

Do "fittings schedules" usually include the cost of such fittings?

Thanks, Curious ...