What would be considered reasonable in a slow or somewhat steady market? Would asking for 8-12 weeks settlement be considered excessive if the property has sat on the market for many months already and the seller is semi-desperate to just get an offer? What settlement terms have you guys heard of when the market was slow? I've only ever bought in moderate markets where competition was above average so I don't have any experience with this. Obviously this wouldn't fly in a hot market but as many if you know most of the Gold Coast is far from hot.
Do you think 8 week settlement would be reasonable in a slow market? (Gold Coast)
- Thread starter jerrybee
- Start date
A hot/cool market affects price and contract conditions, but length of settlement depends on the buyer's and seller's particular circumstances. In a hot market, you offer settlement terms to suit the seller. They might want to settle fast because they want the money faster, or they might want to settle slower because, as an example, they're waiting their new build to be completed.
If the seller is desperate, they might want to get the money as soon as possible. So you might get them to accept a contract with a fast settlement but at a lower price.
I don't understand where you're coming from. Do you NEED a long settlement? Or are you using length of settlement as part of your offer strategy?
If the seller is desperate, they might want to get the money as soon as possible. So you might get them to accept a contract with a fast settlement but at a lower price.
I don't understand where you're coming from. Do you NEED a long settlement? Or are you using length of settlement as part of your offer strategy?
I have a friend that's looking to put an offer in for a property. Price he's offering is reasonable but because of his complex financial situation he won't be able to obtain funding for a while, so he wants as much time as he can get basically.
Basically his understanding is that the seller can afford to wait a while BUT ultimately wants to sell. He's just afraid that someone will come in and even with a cheaper price, will win because of faster settlement times. He thinks the seller will tell him to take a hike with a 12 week settlement.
Then there's no 'reasonable'. Your friend has no choice but to offer a long settlement, and hope he finds a seller who also needs a long settlement. The seller looks at the entire offer, not just whether the price is reasonable. To put it another way, a seller may be willing to accept an 'unreasonable' offer if the other conditions are right.
Maybe he should just wait until he clears up his financial situation first? Qld contracts allow some pretty generous timeframes for finance clauses, but if he doesn't know how long it'll take to clear up his finances, he runs the risk of not being able to settle. In which case you get to see the flip side of your other thread: what happens if the BUYER crashes an unconditional contract?
Bread and butter stock on the GC isnt hot, but its not very negotiable either.
if its premium end , things are still a little slow
ta
rolf
if its premium end , things are still a little slow
ta
rolf
Your friend would have to look at TWO dates in the contract. One is the date on which finance has to be finalised, the other is the actual settlement date. Even with an 8-12 week settlement, the date for finance approval may also have to be negotiated.
The longer the finance clause (when the contract becomes unconditional), the less attractive the contract will be to a vendor.
Marg
The longer the finance clause (when the contract becomes unconditional), the less attractive the contract will be to a vendor.
Marg
A 4-6 week settlement is the norm in QLD.
Yes, this has been my experience of the expectations in Qld. Thirty days being the most common desire of sellers.
Until one asks, however it will never be known whether this property's seller is price or time sensitive.
Jerrybee, your friend could put in a 21 day finance clause and go for 60 days settlement. The reaction of the seller may further assist in defining what is more pressing to them. Bearing in mind, your comment that it's been on the market a while, they may go for a conditional contract (finance and building/pest) and slightly protracted settlement.
If this is a run of the mill type property on the Gold Coast, my observations are that the market is not slow at all. It isn't on fire by any means, however clearance rates have improved for median and slightly above median priced properties. The upper end (as Rolf has pointed out) is still slow and more amenable to seeing a conditional contract being acceptable.
It may behoove your friend to get their finance ducks lined up sooner rather than later and if this one doesn't work, there will be other properties to come on the market.
Bottom line is that your friend will not know until they ask, by putting in an offer that suits their terms and gauging the reaction. If they don't ask, the answer will always be No!
clearly if your friend does not have finance approved for the purchase price then he/she has to offer a "conditional" offer based on finance approval which most vendors wouldn't accept if they are smart; sorry?.
Thanks guys, looks like I've learned a few things: finance date is the more important than settlement date (although both need to be reasonable). I guess sellers need assurance that you've gone unconditional on the FD.
Also interesting to hear about the Gold Coast market. I was under the impression that was on life support. I guess things have changed in the last 2-3 years.
Also interesting to hear about the Gold Coast market. I was under the impression that was on life support. I guess things have changed in the last 2-3 years.
If they are desperate to sell they may be willing to consider all options.
