Is it okay to buy a land which is going to be titled in 6 mths?
- Thread starter s050399b
- Start date
why is it not yet titled?
who tells you it will be titled in 6 months - council or vendor?
what if something happens and it doesnt get titled?
Does the contract contain a provision that makes the sale conditional upon the land being titled or at least provisions for you to receive some compensation in case it doesnt go ahead?
who tells you it will be titled in 6 months - council or vendor?
what if something happens and it doesnt get titled?
Does the contract contain a provision that makes the sale conditional upon the land being titled or at least provisions for you to receive some compensation in case it doesnt go ahead?
This is very important:
make sure you have an easy "get out" clause or two in the contract if the title does not come through when it should.
I have known of a recent case where there was an issue with title being provided and it has tied up 30 plus peoples deposits for almost 18 months so far...and its still going!
Just be 110% sure you can receive your deposit back easily...ensure you make your solicitor aware of what you want......there are some very tricky contracts around when it comes to holding blocks on deposit without title...
Trust no one in real estate...use your instinct to satisfy yourself all is above board.
make sure you have an easy "get out" clause or two in the contract if the title does not come through when it should.
I have known of a recent case where there was an issue with title being provided and it has tied up 30 plus peoples deposits for almost 18 months so far...and its still going!
Just be 110% sure you can receive your deposit back easily...ensure you make your solicitor aware of what you want......there are some very tricky contracts around when it comes to holding blocks on deposit without title...
Trust no one in real estate...use your instinct to satisfy yourself all is above board.
That was my thought, too. And I believe that you can't borrow anything until the titles are issued, so make sure that there's no possibility of you having to pay any significant cash prior to titles being issued.
There are loads of potential pitfalls and I'd be getting a lawyer to review the contract carefully prior to signing.
agree with all that's been said.
you need to be very very careful with this situation.
Council can be notoriously slow in getting things done, and normally it has to go through so many different governmental organisations (eg: Environment etc) that sometimes the delay is out of Council's control so they cant do much either.
The bottom line is a lot of things can go wrong in 6 months so proceed with caution
you need to be very very careful with this situation.
Council can be notoriously slow in getting things done, and normally it has to go through so many different governmental organisations (eg: Environment etc) that sometimes the delay is out of Council's control so they cant do much either.
The bottom line is a lot of things can go wrong in 6 months so proceed with caution
I bought land 6 years ago which was going to be titled within two months, which grew to nearly twelve months, For me it was not an issue and I was lucky that my house was built in 10 months when soon after due to the building boom in Perth houses were taking two years to built.
If it is not an issue for you if the titles take longer, at least you are locked in to that price of land which can be advantageous. Of course you would need to ensure that is the case with the contract you sign.
If it is not an issue for you if the titles take longer, at least you are locked in to that price of land which can be advantageous. Of course you would need to ensure that is the case with the contract you sign.
We bought a lot, (in an AV Jennings estate), for $181k that was not due to be titled for 12 months, it was great for us as we knew we wanted to be on that estate but we were fresh in the country and not ready to build for some time.
We only had to put down $1000, and then 10% within 2 weeks of title. It meant we got a block for a year for a grand. Had we waited until we were ready to build similar blocks 12 months later were selling for $215k+ and none left in the part of the estate we wanted.
It obviously depends on your circumstances, whether you can wait and be prepared for further delays if it comes to it, and the circumstance of why the title is not due. I have no idea why AVJ sold these particular blocks so early, but it worked out well for us. In the end, ours titled a month or two later than expected if I remember rightly.
We only had to put down $1000, and then 10% within 2 weeks of title. It meant we got a block for a year for a grand. Had we waited until we were ready to build similar blocks 12 months later were selling for $215k+ and none left in the part of the estate we wanted.
It obviously depends on your circumstances, whether you can wait and be prepared for further delays if it comes to it, and the circumstance of why the title is not due. I have no idea why AVJ sold these particular blocks so early, but it worked out well for us. In the end, ours titled a month or two later than expected if I remember rightly.
Because pre-sales enable them to access the funds they need for construction.
Because pre-sales enable them to access the funds they need for construction.
Even though they only got $1k per block deposit? I assume the signed contracts were enough for them to secure future finance or something?
I agree that the signed contracts are sufficient from a legal perspective, but I would think that the $1K deposit is to demonstrate to the lenders that you're legitimate purchasers with something to lose by withdrawing.
The crux of the matter is that you need to be certain that you will be benefited by the deal and that your investment $$ multiply. This will be worked out by your DD and research - which includes studying the contract . OTP can have its benefits when the market is rising and you are only tying up a small deposit. There may also be discounts on state taxes - like SD in NSW at present. Otherwise if the market has been flat you are in a great position to negotiate terms and price. What are you buying and where?
. OTP can have its benefits when the market is rising and you are only tying up a small deposit. There may also be discounts on state taxes - like SD in NSW at present. Otherwise if the market has been flat you are in a great position to negotiate terms and price. What are you buying and where?Similar threads
