NSW Buying apartment, concern with the quality, with pics

Discussion in 'Property Analysis' started by MagicWarren, 20th Aug, 2019.

Join Australia's most dynamic and respected property investment community
  1. MagicWarren

    MagicWarren Member

    Joined:
    13th Aug, 2018
    Posts:
    15
    Location:
    Barangaroo
    Hi,

    There are 3 apartments in a complex for sales. I chose one of them, paid 0.25% deposit. I called the other real estate agent to say that I chose X over yours, please tell the vendor I am not buying hers now. Then the vendor gave a big discount and looks hurry to sell. This made me feel this building suspicious.

    Please have a look at the pictures taken at the lowest level of the basement. How serious is it, and how sure is it? Water leaking at the basement.
     

    Attached Files:

  2. Trainee

    Trainee Well-Known Member

    Joined:
    24th May, 2017
    Posts:
    2,655
    Location:
    Australia
    You really want a building inspection and review the body corp minutes. Why did you sign and pay the 0.25 anyway?
     
    Shazi and The Y-man like this.
  3. Hetty

    Hetty Well-Known Member

    Joined:
    27th Jun, 2015
    Posts:
    222
    Location:
    NSW
    Doesn’t look ideal. Read the strata report before the contract goes unconditional.
     
    Shazi likes this.
  4. Scott No Mates

    Scott No Mates Well-Known Member

    Joined:
    18th Jun, 2015
    Posts:
    15,465
    Location:
    Sydney or NSW or Australia
    Who is paying for the remediation work in progress? Is this property still under warranty? Is there a special levy looming? How healthy is the sinking fund?
     
    Shazi, Perp and Sackie like this.
  5. Ted Varrick

    Ted Varrick Well-Known Member

    Joined:
    21st Jun, 2015
    Posts:
    1,639
    Location:
    No Mans Land
    Um, is this a new building, ie. a high rise?

    Just in case you didnt catch 4 Corners last night... Cracking Up
     
    Shazi likes this.
  6. Rhiannan12

    Rhiannan12 Member

    Joined:
    13th Oct, 2017
    Posts:
    12
    Location:
    Sydney
    Do you have a conveyancer to do all of the searches for you?
     
    Shazi likes this.
  7. Cimbom

    Cimbom Well-Known Member

    Joined:
    19th Jun, 2015
    Posts:
    1,548
    Location:
    Back in Canberra!
    Where is it located?
     
  8. MagicWarren

    MagicWarren Member

    Joined:
    13th Aug, 2018
    Posts:
    15
    Location:
    Barangaroo
    Hi, thanks for everyone.

    Ashfield, the complex is 2 years old, 36 lots. Yes, I have a conveyancer. If this is obviously too bad, I would not bother to pay for the strata report, as my conveyancer says it is $240. If it is not obviously serious, I will pay for the strata report. Also there are 5 sales from 36 owners, this makes me feel not encouraged to pay for the strata report now. The 0.25% deposit will be refund as I did not sign the contract.

    The lowest basement has water leaking problem. The strata vacate it and is repairing. That is the information I get without a strata report.
     
  9. Trainee

    Trainee Well-Known Member

    Joined:
    24th May, 2017
    Posts:
    2,655
    Location:
    Australia
    Why did you pay the 0.25% if you didnt sign the contract?
     
    Shazi likes this.
  10. The Y-man

    The Y-man Moderator Staff Member

    Joined:
    18th Jun, 2015
    Posts:
    4,819
    Location:
    Melbourne
    As per @Trainee above - I am not sure why you paid "deposit" ~ once you pay, it is often difficult/slow to get back.

    The Y-man
     
    Shazi likes this.
  11. Depreciator

    Depreciator Moderator Staff Member

    Joined:
    15th Jun, 2015
    Posts:
    1,618
    Location:
    Sydney
    It is impossible to tell anything from those photos about what is happening in that basement. Clearly all is not well.
    You don't need to pay $240 for a strata report. You can make an appointment with the strata manager and go and sit in their office and read all the strata minutes. If anybody makes it difficult to do this, you will know why.
     
    Shazi likes this.
  12. Scott No Mates

    Scott No Mates Well-Known Member

    Joined:
    18th Jun, 2015
    Posts:
    15,465
    Location:
    Sydney or NSW or Australia
    If $240 is too much to outlay for information about a $600k+ investment, you need to review your priorities.

    This is part of your due diligence. If a flooded basement isn't enough to scare you off not knowing who's paying for it then you're a braver person than I.
     
  13. Cimbom

    Cimbom Well-Known Member

    Joined:
    19th Jun, 2015
    Posts:
    1,548
    Location:
    Back in Canberra!
    I personally wouldn’t buy a new apartment in that suburb regardless of build quality. There’s no CG upside likely any time soon and plenty of supply in that general area
     
    Shazi likes this.
  14. MagicWarren

    MagicWarren Member

    Joined:
    13th Aug, 2018
    Posts:
    15
    Location:
    Barangaroo
    I did not say I am not willing to pay that fee. It is just that it is so scary that I may not buy this property without needing to read strata report now.
     
  15. MagicWarren

    MagicWarren Member

    Joined:
    13th Aug, 2018
    Posts:
    15
    Location:
    Barangaroo
    Thank you. Anyone can ask to read the strata report with an appointment?
     
  16. MagicWarren

    MagicWarren Member

    Joined:
    13th Aug, 2018
    Posts:
    15
    Location:
    Barangaroo
    It is a 675k property with 640/w rental, 10 mins walk to the station, 115 sqm, good internal condition, in Ashfield. And in the inspection day, others are interested too. I checked with the conveyancer and the vendor's agent that 0.25% is refundable without condition, and paid it to lock in this property.

    I told the agent who is selling another property in the same building, as a courtesy, that I am not going to buy his. Then he offered 670k and hinted me to bargain for 650k. I realize at that time it is not right.

    Discussed with friends in the real estate industry, and discouraged to buy it. I will double-check the basement with a builder tomorrow.
     
  17. Scott No Mates

    Scott No Mates Well-Known Member

    Joined:
    18th Jun, 2015
    Posts:
    15,465
    Location:
    Sydney or NSW or Australia
    Will you know what you are looking for in the minutes?

    People pay for plenty of building inspections prior to going to an auction where they may be successful too - it doesn't stop them from undertaking their due diligence to establish whether or not to proceed.
     
    Shazi likes this.
  18. Trainee

    Trainee Well-Known Member

    Joined:
    24th May, 2017
    Posts:
    2,655
    Location:
    Australia
    Never heard of this in nsw. If its refundable unconditionally, whats the point and what is the vendor getting out of it?
     
    Shazi likes this.
  19. MagicWarren

    MagicWarren Member

    Joined:
    13th Aug, 2018
    Posts:
    15
    Location:
    Barangaroo
    Yes, I would love to pay the building inspector to do the due diligence. And I asked for the recommendation of an inspector. Just the people in the industry told me that a several-hundred-dollar inspection will not discover real structure defect.

    As for the water leaking or cracking on the wall, a builder is sufficient to discover.
     
  20. MagicWarren

    MagicWarren Member

    Joined:
    13th Aug, 2018
    Posts:
    15
    Location:
    Barangaroo
    BTW, the 650k - 670k offer is for a 103 sqm apartment in that building. A maximum 27k price gap for 12 sqm could make sense.

    I felt suspicious because of the attitude, not because of the price.