Negotiating price for a unliveable house in a good location

Discussion in 'The Buying & Selling Process' started by Vishh, 2nd Aug, 2020.

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  1. Vishh

    Vishh Well-Known Member

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    Hi All,
    I came across a house which is in a good location. Need advice on how to grab it without inflating the price further. :)
    Since I am ok to renovate, I just checked with the agent. He said they wont allow inspection as property is deemed unsafe. So instead told me to check the property from outside. It seems like we have to knock down and rebuild.
    What will be the best way and price to buy it. I did a check on NSW land value site (Land value search) and it says $520000 . I tracked some earlier sales in the same area for old but liveable houses for around 70-100k above landvalues in 2019-2020, i.e around 600k -620k range.One more detail for valuation, if it may help, there are couple of battle axe sites in the same area which has ~500 sq m for 500k-550k. I am not fond of battle axe blocks.
    So do you think it will be reasonable if I offer around 550-570k. I am ok till 600k but dont want the agent to get greedy and further inflate the prices. ;)
    Thanks,
    Vish
     
  2. Trainee

    Trainee Well-Known Member

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    Like they are working for the seller?
     
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  3. Vishh

    Vishh Well-Known Member

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    I thought all agents work for seller. By quoting higher prices they get to market the property. Is it not true?
    There is one instance where it happened with my friend. They asked hm to send his best offer, then they didn't pulled the property off , but instead marketed saying they recvd offers and eventually sold for 20k above his offer.
    But all I want is to deal this one without any gimmicks by agent. :)
     
  4. Trainee

    Trainee Well-Known Member

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    The problem is you dont know what the vendor is thinking. If they want to just sell, they might take a lowish price. If they are unrealistic, they might not.

    offer the price you want, put an expiry on the offer, dont worry if you dont get it.
     
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  5. Vishh

    Vishh Well-Known Member

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    Yeah sure. Let me try that.
     
    Last edited: 2nd Aug, 2020
  6. Archaon

    Archaon Well-Known Member

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    Did he put a time limit on the offer? This could be the problem.
     
  7. Vishh

    Vishh Well-Known Member

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    Yeah unfortunately he was a novice and no time limit was placed.
     
  8. gach2

    gach2 Well-Known Member

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    Good luck getting land for NSW land value (thats more for land tax purposes) - What area is the land in?
     
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  9. Vishh

    Vishh Well-Known Member

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    You may be right. But bank valuation is also based on that.
    I saw atleast two run down houses selling for land values in last 6 months.I am just trying.
    It is in blacktown, Sydney
     
  10. gach2

    gach2 Well-Known Member

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    I didn't know Blacktown was that cheap 600-620k for meh liveable houses. But based on that 550-570k seems on point. Just remember factor another 20k for demo
     
  11. gach2

    gach2 Well-Known Member

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    Bank valuation is not based on land govt valuation.
     
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  12. Vishh

    Vishh Well-Known Member

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    That will benefit on loan but not for negotiation then. :)
    By the way Blacktown had many properties in 400-500k ranges.
    One such property below. Not sure aout the liveability or surroundings. :)
    upload_2020-8-3_21-19-21.png
    upload_2020-8-3_21-19-38.png
     
  13. gach2

    gach2 Well-Known Member

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    Unless you like camping thats not liveable - its a vacant block

    I remember that property - Was a bargain but that was at the bottom of the market + vacant block of land and if memory was right on auction terms (no building contract etc would have been applied with the loan). Very different times (^ability to get loans - specially if building contracts are accessible though uncertainty of the future)
     
  14. Vishh

    Vishh Well-Known Member

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    Yes it was vacant, but it was R2 zoned and we could construct. There were few more sales around 450-500 range. I checked and bank will give loans upto 80% of land value.
    Is market any better now than it was then? Although REA will tell it is. :)