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Property Thread revisted

kindred

kindred

New member
I bought a house at $230,000 from the government as part of an initiative designed to supply people on a low income with affordable housing. I now need to sell the house but due to the problems with the housing market it is now worth $200,000. My question is this. What the fuck am I going to do! I have had the house on the market for almost 4 months now and the highest offer was $200,000. I owe the bank $218,000 and the realestate company will cost me $5,000 as their fee for selling the house. So the lowest I can sell the house for is $223,000. I have lowered the price range to $226,000 to $229,000. I'm reluctant to lower it a second time as I'm affraid people will keep watching it expecting it to lower and lower. Should I lower the price to $218,000 and then take out a personal loan to pay the estate agent? I can't let the house out and wait for the market to rectify because I need a place to live myself. I had boarders living in it but they trashed the place and stole from me the ****s, so I wont do that again. Am I fucked without hope? Can anyone think of something that may help?
 
Kindred, I know it feels desperate right now, but you need to think about this with a clear head?

The housing market is terrible and will remain terrible for the foreseeable future according to forecasts. So you have a choice to make, continue living in the house and get more boarders in (a more stringent screening process is required obviously!! FIFO workers/nurses/hospitality industry people are great, because they're rarely there or away for stints of time)

This will enable you to continue living in your home and being able to pay the mortgage, until such a time as the market picks up again and you're able to make your money back?

Your other option, is to sell it, for far les than you paid (or owe) for it, try to get a personal loan, to cover the balance of what you owe - and spend the next 5-10 years paying off a debt for a house, that you no longer have, in addition to paying the interest on that loan and rent and expenses somewhere else?

It's a tough one and obviously I don't know your circumstances. But my advice would be, try to stay in your home, if you can.

Am sorry you even need to think about doing this :(
 
It's best to avoid these selling costs, especially considering your entry and exit costs into this property are considerable.
You have a few options to help your cashflow so you aren't forced to sell:

  • Switch your loan to interest only, should take your weekly comittment to around $250/wk.
  • Let someone share your place, but screen them properly this time and lock your own room and don't leave valuables in common areas of the house, get bond and insurance.
  • Rent out your house via property manager and take out landlords insurance, then rent a cheap room elswhere. This will make all your expenses tax deductible, however, not as effective if you're in a lower income bracket.
  • You could consider doing a vendor finance deal, or do a JV with someone who does vendor finance.
  • Get an extra part time job if $250/wk is more than your wages/salary allows, and live in the house yourself.
  • Tell your partner to pay her share of the costs.
  • Get a promotion or higher paying job.
 
Awesome a property thread...

Although given the market and my age I doubt I'll ever own anything unforetunately.
 
kindred said:
I bought a house at $230,000 from the government as part of an initiative designed to supply people on a low income with affordable housing. I now need to sell the house but due to the problems with the housing market it is now worth $200,000. My question is this. What the fuck am I going to do! I have had the house on the market for almost 4 months now and the highest offer was $200,000. I owe the bank $218,000 and the realestate company will cost me $5,000 as their fee for selling the house. So the lowest I can sell the house for is $223,000. I have lowered the price range to $226,000 to $229,000. I'm reluctant to lower it a second time as I'm affraid people will keep watching it expecting it to lower and lower. Should I lower the price to $218,000 and then take out a personal loan to pay the estate agent? I can't let the house out and wait for the market to rectify because I need a place to live myself. I had boarders living in it but they trashed the place and stole from me the ****s, so I wont do that again. Am I fucked without hope? Can anyone think of something that may help?
Click to expand...

Whats the insurance value?
Be a pity if it accidently burned down.
 
JazDSpaz said:
Awesome a property thread...

Although given the market and my age I doubt I'll ever own anything unforetunately.
Click to expand...

Dont believe this man, I bought my first place at age 20 or 21, considering the market now, if you have some spare cash could be the perfect time to start looking for something or at least keep and eye out for some bargains whihc may present themselves in the coming 6 - 12mths.
 
Neddysmith said:
Dont believe this man, I bought my first place at age 20 or 21, considering the market now, if you have some spare cash could be the perfect time to start looking for something or at least keep and eye out for some bargains whihc may present themselves in the coming 6 - 12mths.
Click to expand...

I bought my first at 21 also when i was earning the princely sum of 28k per year. I bought for 197k and sold for 370k and really wish i hadnt. I have my 2nd under construction at the moment - will cost about 335k.

Hopefully one day i have a large collection of houses.
 
wingman said:
I bought my first at 21 also when i was earning the princely sum of 28k per year. I bought for 197k and sold for 370k and really wish i hadnt. I have my 2nd under construction at the moment - will cost about 335k.

Hopefully one day i have a large collection of houses.
Click to expand...

Similar to me, although i bought for about 180 and last valued at about 500, so now own my own house and have some rentals spread over the country.

Never bought off the plan, always pres existing homes, one day i wouldn't ming giving developing a go, get a block and manage the building process of some town houses or units. although not in suburbs i want to live in, i bloody hate town houses and units, hahaha
 
I don't know where you guys live but you can't buy anything but a fibro toilet in someones backyard for under like 300k in sydney, and that will need at least a 20% deposit so I don't pay that stupid loan insurance tax.

Ahh slowwly
 
JazDSpaz said:
I don't know where you guys live but you can't buy anything but a fibro toilet in someones backyard for under like 300k in sydney, and that will need at least a 20% deposit so I don't pay that stupid loan insurance tax.

Ahh slowwly
Click to expand...

Yeah i know, I have a couple of mates in Sydney so i hear all about it, but I live in Melbourne and some parts are like that here as well, but there are still some bargains to be had, just have to keep an eye out and know the areas you're looking at buying into and potential growth areas etc.

But this doesnt help much when you want to live in certain areas.....
 
Ideally i'd love to move up the coast cause I know you can value for money up there. But due to the wifey wanting to be near family i'm stuck in western sydney lol :(.
 
Neddysmith said:
Yeah i know, I have a couple of mates in Sydney so i hear all about it, but I live in Melbourne and some parts are like that here as well, but there are still some bargains to be had, just have to keep an eye out and know the areas you're looking at buying into and potential growth areas etc.

But this doesnt help much when you want to live in certain areas.....
Click to expand...

This ones not off the plan. Bought a block and getting an ordinary house built on it after seeing it as a display home. I've grown up amongst a lot of property investors, but no developers. I'd like to try my hand at each. Back when I had my first property, I did pull some equity out and get a bank approval done to go shopping for a 2nd, but then a lot of things in my life came tumbling down.

But now I'm back with a vengeance :)
 
elmo said:
Whats the insurance value?
Be a pity if it accidently burned down.
Click to expand...

I just read this whole thread and I think this is the only solid advice in here. In the words of the immortal blood hound gang-

Burn motherfucker burn
 
When the cooling off period has finished does that mean you've sold your house? Are the buyers legally obligated to purchase the property? What if they said it was subject to finance? Does that mean they can change their mind at any time stating that they couldn't get finance? Can you contest the buyers ability to get finance?
 
kindred said:
When the cooling off period has finished does that mean you've sold your house? Are the buyers legally obligated to purchase the property? What if they said it was subject to finance? Does that mean they can change their mind at any time stating that they couldn't get finance? Can you contest the buyers ability to get finance?
Click to expand...

Subject to finance means exactly that. If the buyer can't gewt finance in the period stipulated in the contract they can pull out. It's as easy as getting your bank manager to give you a letter turning down your loan application, most will do it if you ask cause you have cold feet or something.

There is nothing you can do almost no one will enter a contract without the finance clause on a conventional sale, auctions are a bit different.
 
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