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Buying property with alterations haven’t been finalised

Discussion in 'The Buying & Selling Process' started by DianeZ, 29th Jun, 2015.

  1. DianeZ

    DianeZ Member

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    Made an offer and the agent said the owner is happy with the offer, and there is another buyer is offering at the same level, so whoever exchange the contract first gets the property.

    The reason why I want this property is because it has a very nicely built pool house apart from the main house (which is really a granny flat has a full kitchen, bathroom, laundry etc. but is called as a pool house without an actual pool), and the owner and agent insist that the pool house has been fully approved.

    According to my own research, the owner has a DA approval of garage and cabana back in 2012, but it was never finalised according to the certifier company they hired. And they couldn’t provide an occupation certificate for the alteration (which is supposed to be a garage and cabana but end up as a pool house). Council said they don’t do retrospective approval for such construction and since it’s zoned as environmental sensitive zone E3, my guessing is it will never ever get approved.

    So I’m really worried about my risk here, should I pursue this deal?

    Thank you.
     
  2. Propertunity

    Propertunity Exclusive Real Estate Buyers Agent Business Member

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    You pays your money and you takes your risks.
    At the end of the day, to my mind, it is only a pool house not the main house.

    Councils can & do (I know they do), retrospective final approvals on structures as long as they are built to code. It may be that you need to have the original DA amended. If you are keen on the property, it may be worthwhile talking to a certifier about what needs to happen to get approval.
     
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  3. Chilliblue

    Chilliblue Well-Known Member

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    Be careful with your insurance coverage as well as many companies will note insure any section of the dwelling that has no approval.
     
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  4. DianeZ

    DianeZ Member

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    Thank you very much for your fast reply, I will try to talk to the certifier they hired to see why they didn’t finalise at the first place and if there is anything I can do to the approval.

    Yes, that’s what worries me the most, I can live with that the pool house get demolished though it’s making it a bad purchase in terms of investment. It really scares me is if I rent out the pool house and accident happens, and I could be charged of negligence and go to jail.
     
  5. Propertunity

    Propertunity Exclusive Real Estate Buyers Agent Business Member

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    I'll have to stop speed reading (I took pool house to be a cabana). If the pool house is truly a granny flat that you plan to rent out separately, then definitely get council or certifier building approval before doing so.
     
  6. DianeZ

    DianeZ Member

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    My solicitor suggests me to get a building certificate before settlement, but under this market, I don’t think the vendor will agree to that and the house will be up for auction this Saturday.

    Also will a building certificate make it legal to rent out the pool house separately?
     
  7. DianeZ

    DianeZ Member

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    What if I plan to live in the pool house myself, and rent out the main house, will that change the story?
     
  8. Propertunity

    Propertunity Exclusive Real Estate Buyers Agent Business Member

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    Make that an agreed special condition in the contract, or else don't bid at the auction.

    An Occupation Certificate will not in an of itself mean that the building can be rented separately.
     
  9. DianeZ

    DianeZ Member

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    Thank you for your advice!

    Just to be clear, so a building certificate is not enough, but an occupation certificate is what I really need?
     
  10. Propertunity

    Propertunity Exclusive Real Estate Buyers Agent Business Member

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    When it is completed, I will receive an Occupation Certificate for a studio that was approved as a separate building that a hobby or my work could be done from. It was not however a habitable building able to be rented out. You need to take advice from your soli.
     
  11. DianeZ

    DianeZ Member

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    Noted, thank you.