advice needed,negotiate price first or strata search first?

[coastalgal]

Hi, recently made an offer on a property that has had concrete cancer and repairs. After many days of waiting (offer made Sat, acceptance Thurs morning) this left me little time to organise strata search.

Agent lies alot! He was pressuring me to sign and put down deposit,I said no not until my solicitor has seen the contract and I do a strata search. He didnt tell us that he would still do an open over the weekend. My husband got cold feet and was worried the agent would say there was another buyer and say we needed to up the offer before we had been able to do a strata search so he withdrew our offer as we hadnt time to do the strata till after the open!

Now there is every chance there is loads wrong with the building, its coastal ,and 40 years old.

My question is should you do a strata before or after an offer is accepted?
We were not left enough time by the sellers to do a search before the next open. Plus we didnt want to loose more money on a deposit...we are the second buyers to walk.

It does not help that the agent has told us two different reasons why the previous buyers walked and they DID put down a deposit and paid ten thou more then us!

 

[priscilla]

How to deal with this is totally up to you it would depend how much you want to buy the property.

The legislation in NSW is if you enter into a contract with a agreed price you then get a cooling off period - normally 5 days but often extended beyond that. During this time the Vendor cannot sell to anyone else, however in exchange for this exclusivity you forfeit 0.25% deposit to the Vendor if you withidraw from the sale.

This would normally be the time you would do your strata search and any other inspections you wanted to do as well as get unconditional finance approval, with the knowledge the property is yours should you wish to proceed.

Any other method leaves you open to other buyers making a better offer than yours and you missing out (unless you can get the vendor to take the property off the market whilst you conduct your searches which would be highly unusual).

I guess only you can make that decision depending on your cirumstances and what you are prepared to do

 

[Mick C]

How to deal with this is totally up to you it would depend how much you want to buy the property.

Agree.

If you are 80-100% certain that this is the "right place" ; then i personally would order the strata before signing;

1. You forfit 0.25% if you pull out if you find something wrong with strata - which is more then your strata search cost anyway ( most of the time)
2. You will need a strata report eventually!
3. You are in a better bargain power and position if you can see the full story- you may find there are minor issue with strata that you can accept with and you might be able to whack another $5,000-$10,000+ off the purchase price depending on the problem ( would be much harder to whack the price one you have signed the contract)

Regards
Michael

 

[sanj]

can someone pls explain what this strata search report is? is it called something else in perth?

you eastern staters are a weird bunch with your verbal offers, cooling off periods etc

ive never had an issue getting a copy of the strata minutes when looking at apartments here, didnt cost anything either but i havent looked at apartments in a while

 

[Jacque]

Agent lies alot! He was pressuring me to sign and put down deposit,I said no not until my solicitor has seen the contract and I do a strata search. He didnt tell us that he would still do an open over the weekend.

Hi Coastalgal

Sorry to hear about your dilemma. Priscilla and Mick have given excellent advice along with the facts about buying here in NSW. Until you have exchanged contracts the property is still on the market and is able to be marketed as such. The vendor has no obligation whatsoever to take the property off the market until exchange has occurred.

I'd also get a strata report beforehand if you're able to do so. As others have pointed out, it's a smaller loss than the 0.25% + strata search report cost that you'd lose once under contract. The risk, obviously, is that the vendor decides to sell to someone else in the interim. It's really up to you to decide how to approach this. Try not to let your personal feelings about the agent (or vendor) get in the way of your decision to purchase. Some buyers make the mistake of doing this (it's a pride thing) and regret a good buy afterwards. Simply conduct your due diligence, make a decision based on the facts and best of luck

 

[subsub000]

Ask a few questions before you make decision. For example, special levies, maintenance history etc. You may evaluate the conditions of the property and risks based on the replies.

If you don't get any concrete replies, the risk is higher and I shall order the strata report before signing the contract.

 

[coastalgal]

Thanks

Thanks to all of you.

This property is still on the market. I think from what you have said and my gut feeling that the most wise thing to do is strata search always first before making offers.

My husband does get emotive about it all. I dont.

I do fully understand how the entire process works. Its the steps best taken to secure a great price for a buyer I was pondering on.

I think in this present market(depressed and I am guessing getting worse) that buyers potentially have time on their side and little competition. They should save themselves money by not commiting to a deposit and contract,rather just a strata and or building report. Then negotiate hard with facts to get the best deal or walk away with the least amount lost.

I am looking in coastal areas and many of the properties have concrete cancer and or will need treatment. Its a very expensive exercise!
One unit which I found out about but not on the market yet needed a min of 50 thousand spent on each unit and tennants will need to move out!