Property options for renos

Discussion in 'Renovation & Home Improvement' started by Tali1130, 3rd Nov, 2019.

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  1. Tali1130

    Tali1130 New Member

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    3rd Nov, 2019
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    Brisbane
    Hey guys, I was selling one of my I.P last year and came across an interesting proposition. A buyer wanted to buy my property under an “option” agreement. Where I would technically still own the house, but he would own the option on my property.. renovate the house and then sell the option. Is this as straight forward as it sounds?

    has anyone had any dealings with this particular strategy? It’s an interesting one as it saves holding costs etc, while you renovate but I’m not sure what you do when you can’t sell it..

    looking forward to hearing from you all

    cheers
     
  2. Trainee

    Trainee Well-Known Member

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    They want to avoid the outlay of buying the property and avoid double stamp duty.

    Whats in it for you? What happens if they renovate, damage something, run out of money, and leave you with a hole?
     
    Tali1130 likes this.
  3. Curious2019

    Curious2019 Well-Known Member

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    I would never give someone access to my property under this kind of arrangement. So much downside for you and no risk for them. Also be careful they don’t want to use the house as a drug lab..
    if you think there is potential to increase the value of your IP why wouldn’t you do it yourself and keep all of the profit?
     
  4. Terry_w

    Terry_w Lawyer, Tax Adviser and Mortgage broker in Sydney Business Member

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    Certainly not straight forward. You need legal advice on what can go wrong, cgt issues and other legal issues