OTP and agent agreements

Discussion in 'Legal Issues' started by Donna L, 31st Oct, 2002.

  1. Donna L

    Donna L Member

    Joined:
    27th Sep, 2002
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    137
    Location:
    Sydney, NSW
    Just for the record, cause a lot of people do not seem to know - when you buy a property off the plan there is often these days a hidden clause saying you will agree to use such and such an agent to lease you property for a minimum of six months on completion of the building..... This clause is known as "third-line forcing" and is not enforceable by the vendor (unless the vendor is also the agent - very rare). You can have the clause taken out and use whichever agent you like.

    Donna L
     
  2. paulzag

    paulzag Member

    Joined:
    18th Apr, 2001
    Messages:
    781
    Location:
    Potts Point, NSW, Australia
    OTP resale restrictions

    Also for people's information, I am hearing that some OTP contracts forbid the buyer advertising a resale if the development has not "sold out".

    Anybody with more info please advise.

    I would guess the restiction is only binding before the OTP buyer has settled their purchase. Once you take title you can do as you want subject to Strata by-laws
     
  3. prunster

    prunster Member

    Joined:
    18th Mar, 2001
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    83
    Location:
    Bonython ACT
    Re: OTP resale restrictions

    That would be to try and curb the flippers from scaring away new prospects.

    I get twitchy when I see a lot of flippers in a development that has not finished.

    It is all part of the due diligence that is performed when diving into investments.
     
  4. Donna L

    Donna L Member

    Joined:
    27th Sep, 2002
    Messages:
    137
    Location:
    Sydney, NSW
    We had this clause on our last purchase. It was open-ended which meant that theoretically we could not onsell until the last unit in the complex was sold. We had it changed to restrict it solely to our stage of the development. This was accepted.