Give up 10% deposit pre settlement?

Hi,

I bought a PPOR 6 weeks ago in inner west Sydney (3bed, 1 bath) and it settles in a fortnight...

Pretty sure we timed the top of the market... after speaking to our buyers agent who has kindly offered to refund half of his fee it seems prudent to simply forfeit 10% deposit rather than face the 20-30% plus falls expected to happen this year....

It’s a biter pill to swallow but the buyers agent is confident we can buy back same place for cheaper in future... also rents are dropping around us so cheaper to rent for next 12 months...

Anyone else having to do this at the moment?

ps wine helps!

ta
Sarah

 

Your contract is probably unconditional now, yes? Check with your lawyer. You might be liable for the falls as well if the seller has to resell for less.

 

As per the other posts

Buyers remorse ?

PS your BA should know you will be liable for the vendors losses, so poor advice !

 

I'm no expert, but I've been hearing property forecasters for many years and I tend to believe Christopher Joye's work. He is forecasting a small decline in value, followed by a sizeable upswing.

Whether he's right only time will tell, but pulling out guarantees a minimum 10% loss by the sounds of it. My opinion only - but holding on if you have job security, cashflow etc. may be the best option.

 

Oh please - why are you listening to this BS?
It's your decision what / who you listen too of course. But I bet you the other 1/2 of your BA's fee that we see nothing like a 20-30% fall - I'm thinking maybe 5%, followed by a quick recovery.

 

Property is a marathon not a sprint.

 

Are you planning to flip? If it falls 20% in one year and rebounds 20% the year after, does it really matter?

 

perhaps you could renegotiate the terms of the contract.

 

Buyers remorse - absolutely!!!!

 

Thankyou Rolf, enquiring with lawyer...

 

Im not sure i can believe any forecast at the moment.. from memory Chris Joye is always pretty optimistic on property...

I dont believe anyone really knows.. its the job losses and inability to service debt that worries me.

In my demographic.. double income and a kid or two with a $1m plus mortgage... lots of job losses or loss of income and many are quickly realising that they can't last 6-12months on one income...

 

Thank you Terry. Enquiring.

 

PPOR buys tend to be long term plays so you generally have time to ride out the market. If you are planning to live there for 5 or so years then it's likely this years blip won't be an issue.

The others have spoken about the risk to you if you try and not uphold the contract so I won't go into that. I would suggest that the Seller will do their utmost to hold you to the contract.

 

Banks are giving 6 month mortgage holidays in the current crisis. What is to stop you settling then applying for this?

I'm in the team that there may be short term pain ... but it will be short term, as in, 1-2 years max

 

Hi Rolf, yes loan approval.... my job security is like many I guess... middle levels of big corporate... safe now but also fair to assume a round of redundancies in 6-12 months due to loss of revenue...

 

My sense is prices will fall for years as frugal / sensible BEHAVIOUR will carry over and we won’t go back to max borrowing for double income anytime soon