Valuation: 'as is' Market Value vs Projected Future value after development. Dispute

Like others, it's coming across to me that YOU are the obstacle in getting a successful resolution to this issue.... however it does appear that we only have part of the story.

Looks like brother wants to sell for a fair price. You want it to buy his half cheaply directly from him, but he wants a little more because of it's potential. He's threatened to take out an action to force you to sell on open market & thereby determine a fair price, but you want to avoid REA/auction costs & have refused.

Is this a fair synopsis ?

To answer the last three - yes - best if you read back to get the whole situation before commenting! But briefly - I own 50%, I want to do the work and I want to keep it (ie buy his half from him). He has an inflated idea of the value. (Read back because that was what the original post was about).
 
Without re-reading your posts, I'm confused why you cannot just agree to his request that it be sold and you split the proceeds. Why would that course of action require any court input? If he has engaged a solicitor in order to force you to sell why can't you simply list it for sale?

The only way to be sure it sells for what it is worth now is to auction it. Any other course could have him accusing you of doing something underhanded. You could still buy it at the auction if you see a way to make money.

Wylie if you re-read the posts you would see that I wish to buy his share out. The original question was because he got a dodgy valuation as he wants a far higher price than it is worth and I was querying what I could do about the valuation. It's so misrepresentative I thought it was probably illegal and I have received advice about that in the posts above (apparently valuers can get away with anything).

The only way he might get to accept what it is worth (far from his valuation) is auction. With all the associated costs. I don't want to pay for his ignorance and petty bullying behaviour. Hence not wanting to go to auction but seeing it as the best case scenario in an unfortunate case where he may not mind spending dollars on lawyers and agents but I do.

I'm about to send his lawyer my valuation (received before his inflated one) and see if he can see sense. Other than that, I am going to wait it out. Terry agreed this is a good option.
 
The only way he might get to accept what it is worth (far from his valuation) is auction. With all the associated costs. I don't want to pay for his ignorance and petty bullying behaviour.
Why don't you agree to auction it on the basis that if it sells for less than the halfway point between your two prices, he has to pay the auction costs, and if it sells for more than that, you have to pay the auction costs. This forces you both to do your best to accurately predict the market sale price.

So if you say it's only worth $350K, and he says it's worth $500K, then make an arrangement that if it goes for < $425K at auction, you were closer to the truth, and he has to wear the costs. If it goes for > $425K, he was closer, and you wear the costs.
 
Why don't you agree to auction it on the basis that if it sells for less than the halfway point between your two prices, he has to pay the auction costs, and if it sells for more than that, you have to pay the auction costs. This forces you both to do your best to accurately predict the market sale price.

So if you say it's only worth $350K, and he says it's worth $500K, then make an arrangement that if it goes for < $425K at auction, you were closer to the truth, and he has to wear the costs. If it goes for > $425K, he was closer, and you wear the costs.

Because his valuation is so completely inaccurate that I am not taking it into account in any negotiation.
 
Why don't you agree to auction it on the basis that if it sells for less than the halfway point between your two prices, he has to pay the auction costs, and if it sells for more than that, you have to pay the auction costs. This forces you both to do your best to accurately predict the market sale price.

So if you say it's only worth $350K, and he says it's worth $500K, then make an arrangement that if it goes for < $425K at auction, you were closer to the truth, and he has to wear the costs. If it goes for > $425K, he was closer, and you wear the costs.

The general suggestion is great though on further thought - if it comes to that, then it may help him to be more realistic! Thankyou Perp.
 
What about agreeing to go to auction on the condition you can bid. That way you can buy his share at market value - as determined by auction.
 
Because his valuation is so completely inaccurate that I am not taking it into account in any negotiation.
That's the whole point - both of you have to put your money where your mouth is. You each read both valuations, and you get one last chance - you to name your highest price, he his lowest. Then if you're still far apart, you auction on the basis I stated, setting the tipping point halfway between your two prices. If he wants to avoid paying costs, it encourages him to be realistic.
 
Wylie if you re-read the posts you would see that I wish to buy his share out. The original question was because he got a dodgy valuation as he wants a far higher price than it is worth and I was querying what I could do about the valuation. It's so misrepresentative I thought it was probably illegal and I have received advice about that in the posts above (apparently valuers can get away with anything).

The only way he might get to accept what it is worth (far from his valuation) is auction. With all the associated costs. There are no more costs except some agencies will charge you $500 for the auctioneer. Some don't charge anything. You don't have to pay for any advertising other than on re.com or Domain, but you could be best served to suggest that you only list it on the agency site, which will mean much less traffic to see it. I don't want to pay for his ignorance and petty bullying behaviour. Hence not wanting to go to auction but seeing it as the best case scenario in an unfortunate case where he may not mind spending dollars on lawyers and agents but I do.

It seems he has already sought out a lawyer, so I doubt he will see "sense". He thinks it is worth a lot, you know it is not worth his valuation. You aren't on good terms. He isn't going to back down. I see the only way to get out of being tied to him is to sell or auction. Selling means choosing a price, which clearly isn't going to happen.

You could start at his inflated price, and let it go stale, but even if you buy his half once the market shows it is listed way too high, he is still never going to accept that what you offer is fair to him.

I see no other way than to auction it. Pick an agency with no extra cost, or pick one and pay the $500. That is all the extra an auction costs, and if you pick an agency that doesn't charge anything for the actual auction, it doesn't cost one cent more than a private treaty sale. There should be no legal fees and there will be commission on the sale which wouldn't be a cost if you could buy him out... but that isn't going to happen, so I reckon you make the best of it and auction it.


I'm about to send his lawyer my valuation (received before his inflated one) and see if he can see sense. Other than that, I am going to wait it out. Terry agreed this is a good option.

Waiting it out... what does this do? You both pay more tax after a certain date. He gets annoyed and digs his heels in further. You stay tied to him for another year or so.

Cut your losses, auction it, say goodbye to him. Buy it at auction if you still can make a profit, but sometimes you just have to suck it up.

I would certainly not sit and wait it out. We were legally "in the right" and our brother had to "fight" for what he got... according to our lawyer and barrister. We only got a lawyer and barrister because by the time this brother showed his hand and we got the first inkling of what was to come, his bill was $22K. If we fought him and lost we would be hit with his legal fees, plus ours.

Don't sit and wait when your brother already is racking up legal bills.
 
Waiting it out... what does this do? You both pay more tax after a certain date. He gets annoyed and digs his heels in further. You stay tied to him for another year or so.

Cut your losses, auction it, say goodbye to him. Buy it at auction if you still can make a profit, but sometimes you just have to suck it up.

I would certainly not sit and wait it out. We were legally "in the right" and our brother had to "fight" for what he got... according to our lawyer and barrister. We only got a lawyer and barrister because by the time this brother showed his hand and we got the first inkling of what was to come, his bill was $22K. If we fought him and lost we would be hit with his legal fees, plus ours.

Don't sit and wait when your brother already is racking up legal bills.

Thankyou Wylie for all that above - including the red comments which I couldn't quote - all extremely helpful. I've just finished a letter to his lawyer in response to the one I got today again threatening Supreme Court action. I've enclosed my valuation this time - the one I already had when I made my first offer and the one it was based on (plus my knowledge of the area etc) - I also have increased my offer for his share to above my valuation (still well below his) and will wait and see what happens, but definitely the above is taken on board for sure. Cheers!
 
Yeah, dont do business with family. You can go look for your own deals where your not hitched to anyone in the family.....even if you buy his share, mark my words, you will not hear the end of it.....

From the outside it is easy to see how each is thinking, neither is right or wrong, or rather none is more right or wrong than the other, he is wanting you to share potential profits, your not wanting to share at all.

If you insist on this, you could put the property to auction, set his value as the reserve & bid yourself with agreement that he will negotiate with you if reserve is not met assuming your the highest bidder, who knows, you may have someone willing to pay a price that pleases both.

Good luck.
 
*bump* Any news?

I have not really wanted to look on here - just kept working and battling on to get this finalised.... To all those who helped me out with advice THANKYOU and ....

Finally!! It settled last week. For the price I was willing to pay him before he got his lawyer involved - also under the top price I would have been prepared to pay - and I can imagine how much his lawyer cost him.

Before he started being nasty I would have paid him even higher. That all went by the wayside as did any chance of any further relationship with my 'brother'.

So!! Such a relief all that is over and I can get on with what I was going to do originally... I may be posting when I have more time about that otherwise I'll just be reading up on here for tips of subdividing.

... but to a few who have commented about never going into business with family... please read the original post - this wasn't a 'choice' - we were both left half a property each - nothing to do with business.
 
Finally!! It settled last week. For the price I was willing to pay him before he got his lawyer involved - also under the top price I would have been prepared to pay - and I can imagine how much his lawyer cost him.
Great outcome, well done! :)


... but to a few who have commented about never going into business with family... please read the original post - this wasn't a 'choice' - we were both left half a property each - nothing to do with business.
Sometimes people jump into the middle of a thread and comment without knowing the full context. Best not to take it personally.
 
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