Commercial Sales Data Question

I recently purchased a small commercial office suite.

As part of my due diligence, I obtained the historical sales data of all the previous sales in the complex from the Valuer General’s Office (WA), however, although the data listed the previous selling price, it was not possible to determine if these sales figures were GST inclusive or exclusive.

Subsequent queries with DOLA (Dept of Lands Admin) who register all the Transfer documentation could not confirm which was the case and merely stated that they use the figure that is shown on the transfer document prepared by the solicitor or conveyancer.

My conveyancer then advised that in some cases they show a figure which might or might not include GST. In my case the purchase price was inclusive of GST, therefore, I was advised this would be the figure on the Transfer document.

Given that some commercial sales figures can be stated as without GST (going concern) or inclusive of GST or somewhere in between for margin scheme, can anyone advise how one can accurately use historical sales data for commercial property??

Or was I misinformed?

TIA

Joe D
:confused:
 
Dear Joe,

Good question.

There will always be lies, damn lies and statistics. With statistics it depends on what they mean to you or to the market at any point in time.

At the same time I am sure that you use this grey area to your advantage as well if you are creative.

Cheers,

Sunstone.
 
Hi Joe

I would look at it being if the property is sold as a going concern it would be at a higher value than an empty one.

A good valuer will list comparable sales in his/her report.

Remember to compare apples with apples, veiws of a park are worth more than veiws of a carpark ;)

IMHO I don't think the margin scheme is used all that often for comercial property unless it is for residential conversion by the new owner.

bundy
 
Sunstone + Bundy

Fortunately, when arriving at my offer I assumed the previous sales data was GST inclusive which worked in my favour when I found out (from the selling agent) that in fact the most recent comparable figure stated was before GST.

Without knowing beforehand though, it could equally have worked the other way to my disadvantage had I assumed the figures were GST exclusive if they were not.

You live and learn .......... more and more!

Cheers

Joe D
 
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