Can you do contemporaneous settlement in this way?

[fudosan]

I've not done any flipping/trading so please bear with me, although I have read many of the past forum messages related to these topics.

(1.) Say I buy a property for $240k with registered valuation $300k. If I sell for $270k and double settle (or later if necessary as I have the finance to hold the property anyway), will there be any problems with the vendors? Do I need to tell the vendors that I may on-sell at a different price?

(2) Will spending money to provide LIM, registered valuation, and building inspection reports really help buyers make a quick decision? Or is it just a waste of time as buyers prefer doing their own due diligence anyway? What's your experience in providing necessary information to potential buyers?

(3) How do you motivate the vendors to let you bring serious buyers through their house?


Thanks.

[Julian]

fudosan,
LIM, building inspection and reg valuation may help create, and justify the sale price you want. I would encourage it.
No need to let the seller (or any previous owner for that matter) know that you are on-selling the property for a higher price. Your business is your business. There could be tax implications, though.
As for getting the vendors to let your potential buyers into their house your S&P agreement should have had a suitable clause, such as: conditional upon the vendor allowing the purchaser reasonable access to show potential occupiers through the house.
Julian

[fudosan]

allowing the purchaser reasonable access to show potential occupiers through the house.

You are playing with words.

[Wezz]

Hi Fudosan

Your comment on "playing with words", is quite right, however, Julian is actually correct. That clause is sufficient to enable you to do what you want to do and has been used many times succesfully by other investors, including myself.

Cheers - Pete.

[fudosan]

Thanks Julian and Pete. I must say I'm not good at playing with words. If the vendors ask you to clarify what you mean by "occupiers", how would you answer?

[cube]

Thanks Julian and Pete. I must say I'm not good at playing with words. If the vendors ask you to clarify what you mean by "occupiers", how would you answer?

"Do you want to sell the house or not!"

[Cliffy]

How about "People who might live here"

or "I may rent it out" (which may not be a lie - you may have renting/lease option as an exit strategy if you can't sell).

[fudosan]

Hi Cliffy,

Good suggestion! Thanks.

I have a feeling from reading your past posts that you are a professional trader. Care to meet over a cup of coffee (anywhere of your choice, on me) and give me some pointers on contemporaneous settlement and other trading tips?

[toby]

If you have good rapport with a Vendor it is very rarely an issue to flip a house whilst the owners are still there.

The only thing I would say is if you are going to publically advertise the property you either need to suggest to your purchasers that they don't enter on to the property because of animals and or say to your Vendors this " I like your house and I'd like to buy it, would it be ok that if someone wanted to buy the house from me I could show those people through the property when your home, the price that we agree on here is the fixed price, so you won't get any less, I know people that may be prepared to pay me a few hundred dollars for finding them a house?" - or words to that effect.

Whilst I don't suggest it I've shown homes when we didn't even have it in the contract.

I've also done it when I simply had an option and sold it on with no risk at all.

That maybe where you want to start.