What are your contract conditions?

Today I was beaten on a deal, not by price but terms. I generally will go 7 day building & pest, 14 days finance and a 28 day settlement. Seems reasonable for both sides and has worked well for me thus far. This deal I knew was underpriced so acted quickly. My signed contract was with the agent a couple of hours after being listed.

The other contract (well, one of the 5!) was cash unconditional so there wasn't much I could do. It did make me wonder though; what terms do you put a HOT deal when you come across one? Who are these folk that are offering cash unconditional? Do they have over half a million dollarydoos just sitting in a mattress somewhere?

 

Cash unconditional refers to no finance or conditions...not specifically paying cash

 

Agree... If you are sure you won't have any problems 'cash' offers are the way to go.

 

Further on from this so they may say 'cash unconditional with a 55 day settlement'. That still gives them time to get finance and settle but the deal is set in stone from day one with no backing out.

 

I wouldn't buy without building/pest and finance.
If it's a bidding war, move on to another property.
With the last one, our conditions were to be as flexible as possible. Found out some extra info and just tried to be human about it and it went in our favour over someone who offered a little higher. It's not always the $$$

 

None. Unconditional straight up.

 

Others have mentioned what cash means, so I will not readdress it.

Did you know there was five other offers?

If you did you really needed to go unco and have the preferred settlement for the vendor or it would be tough to beat the other 5 unless your price was superior.

Had the vendors bought already or did they still need to buy? If you selected 28 day settlement and they still needed to buy that might of been the biggest issue.

 

Some states have cooling off periods (such as SA). I have bought without B&P condition because I can get it done within the cooling off period - if the outcome isn't great you have the option pull out there and then anyway. It doesn't hurt checking availability of your preferred inspector prior to submitting your offer though!

Also, if you have finance approval upfront, unless your circumstances or the lending conditions haven't changed, its highly unlikely for your finances to fall through...depends on your risk appetite

Lastly, I've always viewed it that offering as flexible settlement period should be more accommodating to the vendors than a quick settlement (unless you know for definite that they are desperate for a quick sale). By offering a condition of 28 may not actually suit them if they want/need longer

 

Last two have thankfully been cash and conditional subject to the following:

- All keys supplied to all locks
- Master code to alarm or security box (yes one property had both)
- All electrical in working order (as power is disconnected)

The other benefit that we had was that we were flexible with the vendor. I.e. happy to accept a low paying tenant in one as they were on monthly anyway and an early settlement for the other.

A good selling agent will know what their client wants and its your job to find out how to word your offers to those wants.

 

Never go full unco.

 

I wouldn't personally but if the deal was right I would.

I would go full unco if I was buying $10,000 for a 10 acre property within 5kms of Sydney.

However if you were really after a property and there was a huge amount of attention and you know you are safe you can do unco.

If you purchase in VIC you can cool off within 3 clear business days if the B&P didn't turn out favourable (cost money to cool off).

 

I was referencing this:

 

I didn't get it at first (as in the quote) not the video lol

 

I would have still purchased if building and pest detected WMD's filled with anthrax in the basement, it was well under land value! In hindsight I should have checked with my broker and gone unconditional. I don't think I would have had any trouble with finance.

Gordon Park by chance?

 

Unconditional every time.

 

Hehe, I'll try to get it back on Tropic, er, I mean topic.

Really? Even in a low market?
Most of the time you would probably be Ok. But you only need that one time...

 

If you have a correctly structured portfolio and options this isn't really an issue.

How do you mean a low market? I'm generally not in the business of offering at standard market value/over value so valuation issues is near non existent - the only real thing to manage is risk ratings + works to complete if required.

 

Do you mean if you don't get a B&P done, and you discover major structural defects or termite infestation later, you have a fall back provided by your other properties?

In a hot market where there's a lot of competition I can understand why someone might want to offer unconditional. But when it's a cool market and you have plenty of time I'm not sure why you wouldn't at least put in the standard B&P and finance.