OTP Purchase - How to offload?

My 2nd IP is an OTP, due for completion in late-2011 - purchased May 09.

In hindsight, it was not a great deal and I should have conducted more DD -they are drastically overpriced! I think they priced the units for what they 'estimate' they'd be worth by 2011...I must admit, I feel for the great sell :(

I only started reading a lot after signing the contract and making the deposit!

I want to know whats the best way to offload the property...do I go through a private agent or through the developer?

If I go through the developer, there's always the hope they would consider re-drawing a new contract??

What are the costs involved? Seller's Commission, stamp duty, others?
Ideally I'd like to on-sell the unit for purchase price + stamp duty + commission...which may be possible, given the developer has only 3 left and is selling an almost identical one at the price I'm hoping to achieve (again, in hindsight is quite overpriced!)

I'm not sure if now is the best time, perhaps I'm best to wait til end 2010/early 2011? The advantage of doing it now is, I could go back to the developer and ask them to onsell it...thoughts/suggestions very welcome...I thought I'd try and get on top of this early and see if I can resolve it!
 
I want to know whats the best way to offload the property...do I go through a private agent or through the developer?
Real estate agent

If I go through the developer, there's always the hope they would consider re-drawing a new contract??
In your dreams :rolleyes:

What are the costs involved? Seller's Commission, stamp duty, others?
Yes, all that + legals


Ideally I'd like to on-sell the unit for purchase price + stamp duty + commission...
Wouldn't everybody? :D


which may be possible, given the developer has only 3 left and is selling an almost identical one at the price I'm hoping to achieve (again, in hindsight is quite overpriced!)
You might get achieve it. (let's hope so). You never know your luck in a big city.


I'm not sure if now is the best time, perhaps I'm best to wait til end 2010/early 2011?
Who knows? :confused:

Take it as a 'learning' and hopefully it does not sting you in the tail. All the best.
 
I believe that some OTP purchases have clauses in them that will not allow you to sell unless all other apartments have been sold or until a certian date.

Could be wrong though
 
hey mate...is the property in QLD???

if so flick me a PM and i'll have a look at it for you and give you what options I can see. OTP can be notoriously hard to shift depending on the circumstances and i've done a lot of it.

at very least I may be able to clarify things for you, hopefully I can point you in the right direction.

cheers
UC
 
Just make sure the person you sell to is rock solid.

I've heard that when a re-sold unit fails to settle when the development is completed the developers go back and enforce the previous contract.

Better check out the legal issues.
Marg
 
I want to know whats the best way to offload the property...do I go through a private agent or through the developer?

If I go through the developer, there's always the hope they would consider re-drawing a new contract??

The developer wants to sell all the properties at his price.

He won't help you sell yours before he has sold every one of his and even then he prob wont care.

He wont even want yours on the market :eek:

If you list it with an agent for below what you paid then it will impact the market value of his.

I wish you'd been a member here before you bought OTP in this climate.

I am not really sure what you can do - maybe get your solicitor to look at the contract to see if you have an out. Unlikely as the developers solicitor will have been instructed to make them watertight.
 
been a lot of this going on. if your contract is water tight your best hope will be an unauthorized variation of the strata plan
 
Thanks for the replies!
I will consider these more over the weeked and send you a PM UC!

Ausprop - do you know of some some examples of unauthorised variations? or is it just any variation without consent every lot owners consent?? I think they've done it all by the letter though...

Marg/andrew - thanks for the warnings!

Propentuity said:
Take it as a 'learning' and hopefully it does not sting you in the tail. All the best.

Definetely a learning experience...already learnt the lesson! I'm trying to get a little proactive to avoid the sting - as any sting will slow me down considerably! :(
 
What research has suggested they are overpriced and how big is the complex? What did you banks val come in at? Are you comparing the price you paid to similar or inferior stock to give you the impression it's overpriced?

If you want to send me through the complex details i'd be happy to have a look into it and give you my opinion, i deal heavily with OTP sales.
 
Hey Joshy-Boi,

Definantely don't sell with developer.

Can you wait until the rush to sell is over?

You are going to have many investors trying to do what you are doing, who have realised they have paid too much and can't afford to hold for whatever reason.

If you can hold out for a year, you will possibly have a better price point to sell on. I can't emphasise this enough.

Developers also have access to marketing tools and advertising that you do not. Don't expect to sell your unit privately at the same cost the developer is selling it for. You would do better to drop it 10k at least.

I know the Gold Coast well, if it was in that area and you would like to PM me the unit complex, I can also throw in my 2c worth.

I also know the most fabulous agent on the GoldCoast - if you want it sold he will be painfully honest and get it done.

Good Luck with it.

Regards JO
 
Ausprop - do you know of some some examples of unauthorised variations? or is it just any variation without consent every lot owners consent?? I think they've done it all by the letter though...

yep... say the balcony is a bit smaller than the orginal plan, or there is some column in the middle of the room. you need to scrutinise the final plan in great detail vs your OTP
 
My 2nd IP is an OTP, due for completion in late-2011 - purchased May 09.

In hindsight, it was not a great deal and I should have conducted more DD -they are drastically overpriced! I think they priced the units for what they 'estimate' they'd be worth by 2011...I must admit, I feel for the great sell :(

I only started reading a lot after signing the contract and making the deposit!!

Hi JoshyBoi,

Are you able to afford to keep it, and if so, would keeping it prevent you from buying more IP's in the future?

I just wonder if there is any point selling it now at most probably a loss, and then going ahead and buying another IP (with all the associated costs) to replace this one?


Regards Jason.
 
Thanks Ausprop

jingo said:
Are you able to afford to keep it, and if so, would keeping it prevent you from buying more IP's in the future?

I just wonder if there is any point selling it now at most probably a loss, and then going ahead and buying another IP (with all the associated costs) to replace this one?

I hear ya Jason, a big concern for me is having sufficient settlement funds, if the valuation comes in low, I'm kinda screwed...I think long term it will be a great property, however will take a while to show CG or even be CF+

josko said:
Can you wait until the rush to sell is over?

I am tempted to hold out, given that settlement is not due for at least 18 months, if not more...6 months should be more then enough time to hopefully on sell...I just want to get on top of it now and sort an action plan so I can best handle the situation :)

Joel McAndrew said:
What research has suggested they are overpriced and how big is the complex? What did you banks val come in at? Are you comparing the price you paid to similar or inferior stock to give you the impression it's overpriced?

I've compared to similar units nearby, inferior in the sense that they are now 3-4 years old and face a different direction...as to the bank's val, isn't this something that requires completion first? Or can a bank val be done of the plans??
 
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