I'm writing up an offer - Need help!!

[Raddles]

Hi there
as you appear to buying a unit - I would also make an offer subject to a satisfactory search of the body corporate records.
With units I actually like to undertake the search myself so I can see how the body corporate is run - and if there are any problem tenants/owner occupiers in the complex. I am also interested in the sinking fund and if there has been adequate consideration of the ongoing maintenance for the building.
thanks

 

[Dazz]

I'm with the others regarding putting in a low deposit, the money only sits in the REA's Trusts account and the government gets the interest on that anyhow- dont they?

Lowest we've put down is $100 and the REA had to ring the principal to check it was valid, we have put more down on occasion depending on the deal and our desire, after all the end goal is to get the IP if we want it

Better for it to be in your bank account and you can afford to be pushy in the current WA market


Here's a couple of conditions to consider, from memory termite inspection seems to be standard in the REIWA contracts, Bayside's wording is worth considering (note the business days comment Bayside added as well ) and your solicitor/settlement agent may be able to assist here as well


*Subject to finance (you can get specific here if you want and name a bank etc, we have never done so though)

* Subject to a satisfactory building inspection

* Subject to a satisfactory termite inspection (termite inspections are worth getting done but all contracts seem to say that they are only valid for the period of time the inspector was on-site )

* Subject to the chattels, fixtures and fittings as seen on the date of inspection (nothing worse thanh seeing items missing as they were not listed)

* Subject to all electrical and plumbing items to be in good working order prior to settlement (take a comprehensive checklist for your pre-settlement/final inspection and push-pull-turn on what you can)

* Subject to all council and regulatory approvals on all building and renovations (that pergola or garden shed just may not be legit)

* Subject to builder's warranty insurance (for new houses or any recent renovations such as pool or pergola)

*sunset clause* depending on negotiations you may want to throw this in (we've only used it once when there was a fair bit of competition for a particular property..we got it)

I cannot believe some of the things you guys are writing down in your offers. You obviously have the upper hand. I just showed that list to the wife and she laughed aloud saying "If someone handed me that (expletive deleted) trying to buy my place, I wouldn't even get half way down the list before screwing it up and throwing it straight into the bin."

I'd have to agree with the wife.

As for the puny deposit....well, more fool you as a Vendor if you accept an offer like that. As a Buyer - great stuff - but just except a whole bunch of rejections. Too bad if you've spent months researching to have your offer rejected and have to start the process all over again.

No problems of course if your time is worth nothing and the property is completely unremarkable. If it's a cracker that's gonna make you squillions - you may wish to re-consider this extremely unattractive - to the Vendor - clauses.

**NOTE** Some agents are not happy when you start crossing out items such as penalty interest and adding clauses

No doubt - I wonder what the Vendor eventually reading it will think / do.

 

[Rob Williams]

I like to keep mine simple. One word "unconditional".
I've managed to buy 5 properties under market value in the last year. I feel I got the deals as much on the conditions, or lack thereof, than price.
I'm with Dazz on this one

 

[redwing]

I cannot believe some of the things you guys are writing down in your offers. You obviously have the upper hand. I just showed that list to the wife and she laughed aloud saying "If someone handed me that (expletive deleted) trying to buy my place, I wouldn't even get half way down the list before screwing it up and throwing it straight into the bin."

I'd have to agree with the wife.

As for the puny deposit....well, more fool you as a Vendor if you accept an offer like that. As a Buyer - great stuff - but just except a whole bunch of rejections. Too bad if you've spent months researching to have your offer rejected and have to start the process all over again.

No problems of course if your time is worth nothing and the property is completely unremarkable. If it's a cracker that's gonna make you squillions - you may wish to re-consider this extremely unattractive - to the Vendor - clauses.



No doubt - I wonder what the Vendor eventually reading it will think / do.

I couldn't afford your family house Daz

No need to wonder what the vendor will do.... in our cases accept (apart from one, we've purchased each property we've gone for), what rejections are you talking about?

The post didn't begin with "Once Upon a Time" so I'm confused with the comments?

We're not buying cattle stations, or Central Park, just normal houses off normal people and have used most of the list at various negotiations, we've 'squeeezed' in on each loan and purchase so we want to ensure we're covered, we're not at the stage yet were we can offer cash unconditionally and a 14 day settlement for discounts...maybe one day

 

[RumpledElf]

14 day settlement? Oh my, in what universe? When we bought our IP it took a week or more for every communication just to get from us to the vendor. I think I had a 2 month settlement and we barely squeaked in.

 

[Dazz]

The post didn't begin with "Once Upon a Time" so I'm confused with the comments?

Soory Red, my comments have been taken the wrong way that I intended. As usual, I've approached the subject matter from a completely different angle and it's been mis-interpreted.

We're not buying cattle stations, or Central Park, just normal houses off normal people

Fair enough - I guess if you are up against normal, you can get away with it.

 

[Alex P Keaton]

No problems of course if your time is worth nothing and the property is completely unremarkable. If it's a cracker that's gonna make you squillions - you may wish to re-consider this extremely unattractive - to the Vendor - clauses.



No doubt - I wonder what the Vendor eventually reading it will think / do.

Usually I would put in a low offer but in this case I feel the asking price (with the DD I have done) is very reasonable considering there is also an extra room. An extra room usually costs another $50 K - 60 K. For this property I am going to offer the asking price (which is in the low $200 K) because I know im getting value for money. The price they are asking is around the same amount as if its a 1 bed. I am converting the 2nd room into laundry/computer room.

Its in an excellent inner city location with a great view. When I move out and I convert the property into an ip I can advertise the 2nd room as a spare room and will be able to charge a higher rent.


Which clauses do you think I should reconsider? I dont want to miss this opportunity but also do not want to forgo some important conditions such as building inspection, pest inspection, body corporate records, finance etc

 

[Alex P Keaton]

14 day settlement? Oh my, in what universe? When we bought our IP it took a week or more for every communication just to get from us to the vendor. I think I had a 2 month settlement and we barely squeaked in.

Oh I thought I wrote 4 week settlement. Im offering a short settlement because i know that the vendor has bought elsewhere and wants a quick sale.

Actually the lady joked they were under financial hardship and then pretended she was just joking. There is a tenant in their till January but she said that they had bought elsewhere and need to sell because they have upgraded to a more expensive house.

Anyway i told the agent that I would like to make an offer and the mb would be visiting me Monday night. She said that she is talking to another lady tonight (which could be true or untrue i dunno) and that she will look at my offer first. I said I will give her a call on Tuesday.

 

[Alex P Keaton]

i wanted to reply to some other people but my lunch break is over.

I'll let you know what happens

 

[Alex P Keaton]

Ok so do these conditions sound ok?


I will fax this tomorrow morning to the re agent


Other Conditions of Offer:
Deposit $1,000 payable after 7 days of acceptance
Subject to my satisfactory Building Inspection within 14 days
Subject to my satisfactory Pest Inspection within 14 days
Subject to my satisfactory search of the Body Corporate records
Subject to Independent Valuation within 14 days
Subject to my finance within 21 days
Settlement 28 days after all conditions have been met

 

[Alex P Keaton]

What happens when you offer.

If another person is offering, are you allowed to counter offer. How does it work?

The re agent says I have first go at making an offer. What happens then if the other person offers something higher, does that mean they get to buy the ip, or am i allowed to counter offer?

 

[Bandita]

Ok so do these conditions sound ok?


I will fax this tomorrow morning to the re agent


Other Conditions of Offer:
Deposit $1,000 payable after 7 days of acceptance
Subject to my satisfactory Building Inspection within 14 days
Subject to my satisfactory Pest Inspection within 14 days
Subject to my satisfactory search of the Body Corporate records
Subject to Independent Valuation within 14 days
Subject to my finance within 21 days
Settlement 28 days after all conditions have been met

Hi Kim,

28 days is probably too short for settlement when finance is involved- we've been lucky to get the bank organised before 60 days. The vendor may balk at 21 days for finance approval - usually it's hard to get 14 days. But, it's all negotiable and depends how much you want the property and how desperate the vendor is to sell.

Good luck!

Cheers,
Jen

 

[Alex P Keaton]

ok ta

......

 

[kph]

What happens when you offer.

If another person is offering, are you allowed to counter offer. How does it work?

The re agent says I have first go at making an offer. What happens then if the other person offers something higher, does that mean they get to buy the ip, or am i allowed to counter offer?

Agent can present as many offers to the vendor at the same time, but the vendor can only deal with one at any one time, so if they deceide to deal with yours, they have to see the negotiations through to completion ( sale or no sale) before they can start to deal with any other offer.

Thats for WA.
We don't have gazumping or any of those other shenanigans.

The offer has to be dealt with in writing and not verbally.

Once both parties have agreed to the price and conditions and signed the contract, the agent conveys this information to both parties ( eg.. "congratulations, your offer has been accepted") and you now have a contract that is enforcable.

kp

 

[WASP]

Why an independant valuation, the bank will do one when they conduct thier own DD, a good MB can assist here as well

 

[sunshine]

Settlement 28 days after all conditions have been met

We usually put 21 or 28 working days. Allows for all those things that can and do go wrong.

Good luck and keep us posted.

Sunshine

 

[merlin]

Ok so do these conditions sound ok?

I will fax this tomorrow morning to the re agent

Other Conditions of Offer:
Deposit $1,000 payable after 7 days of acceptance
Subject to my satisfactory Building Inspection within 14 days
Subject to my satisfactory Pest Inspection within 14 days
Subject to my satisfactory search of the Body Corporate records
Subject to Independent Valuation within 14 days
Subject to my finance within 21 days
Settlement 28 days after all conditions have been met

An offer with so many conditions is going to be 'sold' by the agent as unfavourable. Especially if they have other offers (or promises of other offers forthcoming) to present also.

For most agents, it's just "too hard" for THEM (not the vendor) to deal with so much extra work, when presenting an unconditional offer more favourably means they get paid straight away.

Remember, ALL the terms of your offer are negotiation points, not just the price. Try to have no more than one Special condition, if you absolutely must. e.g. With a financer's pre-approval in place, for example, having a finance clause is pointless and just weakens your offer.

Ask yourself this: would YOU want to accept an offer with so many 'strings attached', so much waiting for this that and the other, and a very real chance the deal will fall through, or would you take an unconditional offer and do the deal today?

 

[redwing]

Here's an older copy of a REIWA form I found when searching for "Contract for Sale of Land/Strata Title by Offer and Acceptance and the Joint Form of General Conditions for the Sale of Land" for those unfamiliar with the WA forms

Also an interesting PDF from REBA

As you can see the wording of the O&A attached is owned by REIWA which represents the interests of real estate agents

 

[Alex P Keaton]

Help - Another Property

I put an offer on this unit and I was told that I would hear back from the re this morning whether or not it was accepted. I am still really keen on it. But the thing is, I need to know ASAP whether the owner has accepted or not

because I just had another look at the re.com site and have noticed another $10 K reduction on a 1 bed in another suburb, and I would like to go look at it and perhaps put an offer on it if I like it. I rang the re agent 11.30 this morning, its now 1.20pm Perth time. I'm thinking about ringing her back to say I will need to know if its been accepted by 5pm today. What should I do. I dont want to miss out on the possibility of losing out on both ip.s

 

[Aaron Sice]

tell her straight out - answer by 5 as discussed or i keep looking....!