FHB wants to withdraw contract & start a new one

[penny]

Hi All,

I had a contract on my PPoR dated Friday 10th Oct, only days before the increase to FHBG commences. The buyer is a FHB and wants to terminate the contract and start a new one dated from today with the same terms so he gets the extra $7,000.

I'm considering whether resigning the contract with the agreed price is a good move for me as I suspect that property prices in the lower end of the market will now increase from what someone was prepared to pay prior to the grant being doubled. Do you think the doubling of the grant will actually push prices upwards? My RE Agent is telling me he doesn't think this will happen.


As I want to buy another PPoR before too long I'm concerned that prices will surge upwards and I will be behind when trying to buy back in.

What is your opinion on the following options that i see I have?

1. Re-sign a new contract for the price / terms agreed to already?
2. Re-negotiate the price so it's $3,500 more - thereby splitting the grant benefit?
3. Not sign the new contract and take the chance that there will be a higher offer in the not too distant future?

I'm not in a position where i HAVE to sell.

My place is a 2 bedroom unit about 7kms from the city so is well and truly in the first home buyer market.

Thanks in advance!

 

[silversands]

Your call Penny, but I like option 2!

All the best.

 

[Qlds007]

Not quiet as simple as that in Qld.

Remember you have to terminate one contract before you can accept another even if it with the same buyer.

Nothing to stop him pulling out and then refusing to sign the new contract.

Why not tell him that if he terminates then you want the new contract to be a cash unconditional contract and get him to waive his rights under the cooling off period.

This is of course assuming you actually want to sell the property to him.

 

[marg4000]

Once you release him/her from the first contract you have no guarantee that a second contract will be signed. You must be prepared for the possibility that the buyer is using this as an excuse to walk away.

If you are happy with all of the terms and conditions then I would proceed with the original contract.

If you do agree to re-sign, then there should be something for you in the delays in the form of a slight increase in price.

Just be careful that you don't trigger a commission dispute with the RE agent, check when the actual commission becomes payable. You don't want to agree to break the original contract, have the buyer renege on re-signing and find that you owe the agent commission regardless.
Marg

 

[Bayside]

I asked a guy at the State Revenue Office this same question annonymously as I was thinking of doing the same thing and he said......

Unless the changes to the contract are substantial, it would still be the
signing date of the original contract which would be taken into account for
the FHOG. Eg, prices changes. settlement date variations etc would not be
considered substantial changes

 

[Sunfish]

What Bayside said sounds about right. But even if he were wrong, if the contract is unconditional offer him 50c and tell him to ring someone who cares.

 

[willair]

Hi All,


I'm considering whether resigning the contract with the agreed price is a good move for me as I suspect that property prices in the lower end of the market will now increase from what someone was prepared to pay prior to the grant being doubled. Do you think the doubling of the grant will actually push prices upwards? My RE Agent is telling me he doesn't think this will happen.

The Agent has no more chance of getting it right then you do,
imho,i just can't see this new FHB grant is going to pump up the market
but i could be wrong..willair..

 

[penny]

Thanks for all your replies - very useful. I've informed them that I won't be re-signing another contract. His choices are to -

1. continue with the original contract

2. pull out of the contract as it's not unconditional.

I think that this is the best way to proceed for me as I definitely do not want to be getting myself involved in any fraud. I'll take my chances on getting another buyer if he pulls out.

Thanks again for the responses!

cheers
Penny

 

[Spectre]

penny

I would assume that if they have asked to redo the contract - they'd have finance in place and b&p is ok.
I am interested... will you please keep us to speed on the outcome.


Thanks

 

[Alex P Keaton]

Thanks for all your replies - very useful. I've informed them that I won't be re-signing another contract. His choices are to -

1. continue with the original contract

2. pull out of the contract as it's not unconditional.

I think that this is the best way to proceed for me as I definitely do not want to be getting myself involved in any fraud. I'll take my chances on getting another buyer if he pulls out.

Thanks again for the responses!

cheers
Penny

I have heard from a couple of people including the real estate agent selling me my property that it is illegal to draw up another contract. Like Ausprop said in another topic the person will be in trouble with the government and the law. I feel sorry for the kid though. Oh well.

 

[Peter_Tersteeg]

I had quite a few first home buyers call me on Tuesday asking if they'd get the new grant. It's unfortunate that a few people will miss out on it, but in most cases this grant may serve to increase the value of the properties they've already bought.

I think in certain areas it will push up prices. Home ownership just became a lot more accessible for a lot of people so there will be more demand in the immediate future. The supply side hasn't changed in the last two days.