Investing blind
- Thread starter Robbiep
- Start date
Hi guys,
Thanks for the advice.
Agreed, if it has worked for me before, why not try it here in Australia? No harm in trying. I guess all the negativity around this method put me off it a bit.
Is a building inspection compulsory or just recommended? I guess a BI will give you a good idea of any major work needed on the property.
If it does come back unfavorable, at least you can still pull out the deal or have the purchase price amended accordingly.
Question: Once contracts have been exchanged and your building inspection comes back unsatisfactory, can you still back out of the deal?
Thanks for the advice.
Agreed, if it has worked for me before, why not try it here in Australia? No harm in trying. I guess all the negativity around this method put me off it a bit.
Is a building inspection compulsory or just recommended? I guess a BI will give you a good idea of any major work needed on the property.
If it does come back unfavorable, at least you can still pull out the deal or have the purchase price amended accordingly.
Question: Once contracts have been exchanged and your building inspection comes back unsatisfactory, can you still back out of the deal?
Depends on the wording.
not compulsory, but certainly recommended. the report will come back sounding like the place is about to fall down, they cover their behind. call the inspector and have a chat. ask if he would buy it.
So if every report says the same thing, implying that the building is about to fall apart this instant, which you take as hyperbole/*** covering, why bother getting a B&P report?
is that not your experience of building reports, read by a naive reader? why bother getting one? to speak with the inspector.
edit - particularly important for buying site unseen in this scenario. A PM the OP sends around might think it's has great rental potential but not be experienced enough to look at the place and realise it's roof needs replacing and there are termites or otherwise.
Yes for sight-unseen it's not a bad idea. I just fail to see the utility of paying $500 for something that you can't really rely on with any great confidence. Even if you do speak to the inspector - you can't claim any reliance on what he's said extraneous to the report anyway.
edit: It's just like a lawyer giving you legal advice with the words 'everything, and anything that I tell you to do can/may/will render you liable for litigation/prosecution. I take no responsibility if that happens, but I think you should do X'. Stupid, right?
Your basic line of reasoning here seems to be that the hungry but vigilant PM will invest conscientiously in your business before you do. Good luck with that. (In Australian idiom: "You're on a road to a hiding, mate!")
But I will say, you generally get nada for nada doing business here in Aus. (I won't pick up a pen for less than $1K of business as a rule, and that's not untypical I'd suggest. You need to log more than $1K of business debt to take a claim to court here, for example.)
Only the most desperate PMs - and so likely, the most disappointing - will take you up on such an offer. The 'prospect' of $ 1,000 per year in PM fees (say) realistically won't get most RE agents (which is to say, the PMs' bosses, who alone give the okay to 'invest' in client-relationships) to climb out of bed in the morning.
This is because PM fees here do little more than meet basic agency overheads. All the sweet money (i.e. profit) is in RE sales, and only there will Aus agencies 'invest' in uncertain outcomes.
That's what my experience has taught me, anyway.
You've clearly got the loot (with 30 properties) to pay for a BA to plumb these uncertain new waters for you, Robbie. So really, why not? Perhaps think of it as a privately-paid advanced tutorial in learning the ropes hereabouts, and so money well-spent in your new environment?
(NB: I have never used a BA myself, but that's only because I've neither had the money nor the commonsense to do so. But then again I don't own 30 properties either. Wanna swap?)
Hi Robbie
It would depend on where you were buying- as you point out BA's don't operate everywhere. Our report/inspections are $495 for local jobs and then extra depending on distance. You'll find that not all BA's offer this service but we find it quite popular with investors such as yourself who want that unbiased 2nd "on the ground" opinion. We have nothing at all to gain by not providing you with a "warts and all" picture of your impending purchase.
Best of luck with it all.
