August 21th, 2010
I hear a lot of talk about the media reporting many regions quoting (per REINZ latest figures) the lowest number of sales in a decade for July 2010.
Obviously that means that there are a lot of buyers waiting for the “perfect one” to come along before they commit. Either that or there may be some truth in the comment I saw on a board that stated “otherwise, based on turnover, it looks like Kiwis have decided to stay in their present home for the next 27 years!” (can’t remember the exact wording but that was the momentum behind it)
All of this means that when that “dream one” comes along, you will probably discover, much to your chagrin, that, you won’t just be the only one wanting it. When more than 2 buyers want the same property we find ourselves in a “multi-offer” situation.
Well………… for that you have to put yourself in the shoes of the seller.
Sometimes its not just about the price
Is there anything I can do to ensure my offer is in the best position?
Actually glad you asked because there surely is.
Number 1 you need to have organized a lawyer/property conveyancing specialist in advance, way in advance actually, of making any offers. You need to feel confident (aka have some prior understanding/agreement between you & them) that you can go to them at short notice for swift turnaround, and one that won’t cost the earth.
What sort of swift turnaround are you talking about?
The sort of swift turnaround that accompanies this question from you………….
“Hi Bob, its Dave here, just seen a property I really like, and I was wondering if you could please look over the Certificate of Title to 123A Main Rd, Anytown and/or any associated council files to see that there are no problems / issues.”
Now I know that as standard, many of us typically allow 3 working days for a solicitors approval, & that’s usually just for an approval of the Certificate of Title. You want a person who can do this and get back to you, in say, no more than 24hours.
To ensure the Form of the agreement is correct also, you could ask the Real Estate person involved to prepare a contract and get/fax/email that to your nominated person so that they can check the Form of the Agreement is ok too.
Now, clearly after visiting and falling in love with the property, you need to express your interest with the Real Estate Salesperson involved.
Along the lines of “I’d like to express my interest in this property, if any offer comes in, can you let me know right away?”
Secondly, and hopefully if you have read what I wrote above, you make that phone call to your lawyer/nominated conveyancing specialist and ask them to go over the property details/file/title for you to ensure that they and you are satisfied with any easements, covenants, etc.
Thirdly, (“and by now you’re with the program?”) you’ll also be in touch with your lending specialist to seek a 99% confirmation that the pre-approval*** you are carrying around with you is ok for this nominated property.
Fourth – we’re nearly there…..if you believe the property needs a specialist report, from a builder or an engineer, get that organized before too – obviously its very handy if you know a builder, whereas for an engineer there will an upfront expense involved so you do need to take that into your calculations.
Fifth – check with the Real Estate salesperson for what would be the most suitable / ideal time frame required for possession / for the sellers to exit the property – be aware that if tenants are involved there are legal rights / requirements regarding notice for them to vacate the premises too.
We’re just about there……what we are trying to achieve here is a Sales & Purchase Agreement to buy a home that has hardly any, or preferably no conditions or extra clauses.
That way you will have an Agreement that, excepting the price issue, will shine the brightest.
This list is by no means 100% comprehensive, for example there may be a few other circumstances where further conditions can be satisfied before the offer is presented too, but after all this exact process that I have described is exactly what you would already do if you were buying at auction anyway!
Many folk also advise to investigate a LIM report, I would discuss this with your conveyancing specialist prior too any offer, again, ……….exactly the same process you would conduct were you looking to bid at a property auction.
Now I can paint a picture. Real Estate Salesperson/Branch Manager arrives at home of seller at 7pm ready to present 3 buyer offers in sealed envelopes.
…….Continued in Part II
*** – be aware that some pre-approvals will still require a registered valuation on the property – please check with your lending specialist on this, or at exactly what dollar figure you can go to before its necessary to get a registered valuation.