Sunset clause

Hi all, I hope all is well

We currently have an offer on a property for a significant amount less then asking price.

Property was listed over a year ago for low 300's however has been reduced down. We currently have the following offer sitting with the Vendor-

*222k firm
*Subject to finance
*Subject to Building and pest inspection
*Settlement date of December 18th 2020.

The REA mentioned to us that normally they would place a sunset clause on the property which personally is just a time waster for us as if we have to go away and pay for legals and building and pest only for them to accept a higher offer a month down the road does not show good faith.

We are getting the property at a good price and it is a home my partner would be very happy to have (PPOR purchase) however I am just unsure of how to negotiate this clause out.

My partner mentioned to the REA that this is a bridge we will cross if it becomes an issue however we have normally asked for later settlments in the past without this clause being bought up.

Warm regards

 

So you are looking to buy a PPOR and have this offer on the table
*222k firm
*Subject to finance
*Subject to Building and pest inspection
*Settlement date of December 18th 2020.

So, was your offer in writting, and did you put a time limit on your offer ?
Kinda fixes all your issues if you did

 

The offer was in writing however didnt put a time limit on the offer.

The Vendor was fine in price however feedback from REA was they were not happy with a later settlement date.

 

Then I would suggest you find a similar comparable in the area listed with a different agency.

Then email the agency you currently have an offer with to say you are withdrawing your offer effective immediately, as you have found this other property (yes, tell them the address) and you need to be free to make an offer on it.

When the current agency comes back "negotiating" ask for a copy of the contract (you should have it already and have had legal review it) then fill it in with $220k (or less) and your prefered settlement date (take pic's so they can't change it) and send/email it as your final offer valid for not more than 48 hours !

If the agency comes back saying they have another offer say "thanks, but we no longer want it" and walk away.

Is the vendor the developer ?
Feel sorry for the vendor to take such a loss

 

Thanks for this, very valuable stratedgy. Will be doing this!

 

Why not just settle when the vendor wants? It's only $222k, surely you can come up with that? Also, holding costs will be bugger all (well interest anyway).

 

We tried this and the vendor immediately accepted our offer (within 5 hours) we actually made an offer on two other properties (1 with the same agency)

And stated we would take the first offer accepted.

Maybe a little deceitful but they removed the sunset clause and negotiated on a couple more grand to remove the sunset clause.

Happy with the result in the end.

I do feel bad for the owners as I honestly think this property is the best location in town with huge potential to add value.

The Vendor has never sold the property before they have owned the property for over 60 years. Problem was the driveway and it being a 2 bedroom with no ceiling fans and aircons which the current buyers market are not interested in (they want ready to move into).

 

Just a comfort thing I suppose. Worked out well anyway