Buyers Domain has helped scores of property buyers achieve their real estate goals. One such couple, Ed & Laelene Parker had been looking to purchase a family home in Sydney for 10 years before they met Nick Viner. Their budget was $850,000. Within just 3 weeks, Nick helped them purchase a property that met all their criteria for just $575,000.
Here is how.
1. The Clients’ Brief
Ed & Laelene criteria were as follows:
- Freestanding house with three bedrooms on a minimum lot size of approximately 400m2.
- Potential for renovation
- Needs to be immediately liveable
- Location: Inner West and also including Gladesville, Ryde, West Pymble, Melrose Park and Earlwood
- Budget: $750,000 – $850,000
2. The Challenges
The challenges were threefold.
Firstly, it was to identify locations that would be likely to yield suitable options within the budget.
Secondly, the geographical scope of the brief had the potential to cover enormous areas of Sydney.
Thirdly, the clients’ needs and expectations had to be satisfied.
4. The Solutions
I approached the brief by firstly researching and identifying a list of suburbs that met the following criteria:
- Median house price under $850,000
- Average land size of at least 400m2
- Suitable suburb close to Inner West lifestyle options and within approximately 15km to the Sydney Cbd
I then presented the list to the client. Whilst discussing their thoughts in further detail, it emerged that one of the suburbs they really liked was Putney. With a median house price of $1.23m* (source RP Data, July 2011), Putney was not even on the shortlist. Having identified that it appealed to my clients though, I focused on areas within a radius of approximately 5km from Putney and which had a similar feel to the suburb.
Having spent significant amounts of time driving around the area, I felt that the suburb of Ermington, and in particular, the part of Ermington that runs south of Victoria Road to the Parramatta River would be a good fit for my clients. Approximately 5km to the west of Putney and with a median house price of $650,000* (source RP Data, July 2011).
1 Spofforth Street, Ermington was the property I identified. It was in a quiet position, in a desirable part of Ermington and even though the house presented relatively poorly, the house had potential and ticked a lot of my clients’ boxes.
5. Negotiation Strategy
I first inspected the property on 20 August 2011. The agent told me that the vendor was looking for offers over $599,000. I asked the agent to send me a copy of the Contract. I researched the sales history and discovered that the property had been on the market since 4 July 2011 when the asking price was offers over $639,000. The asking price had been dropped to offers over $599,000 on 27 July 2011. The asking price was then further reduced to $590,000 on 23 August 2011.
I questioned the agent about the vendor’s motivation for selling and why the price had been dropped. He indicated that the Vendors were keen to sell before the impending settlement of their new property purchase. However, the agent insisted that the vendor would not sell below $590,000.
Once my clients inspected the property, they were keen to proceed. The building inspection took place at 8.00am on Friday 26 August 2011. Following receipt of the building inspection report and completion of the other due diligence items, I advised the agent that my clients were interested in the property but that waiving the cooling off period would be out of the question. This was to ensure that my clients could rescind the contract in the event that the bank valuation, conducted within the cooling off period, was less than the purchase price.
When I met with my clients, I suggested that they sign the Contract at a purchase price of $575,000 as I felt the vendor’s circumstances provided a good chance for us to secure the property for less than the asking price. They were happy to do this and signed an authority for me to deliver the Contract to the agent to exchange. They provided a 10% deposit cheque which I delivered with the signed Contract to the agent’s office. The agent was disappointed with the offer because he was expecting an amount closer to $590,000 but said that he was going to see the vendor straight away.
Within about half an hour, the agent called me and asked if my clients could increase their offer to $585,000. I said that my clients were not prepared to increase their offer from $575,000 and that if their offer was not accepted, they would be pursuing other properties which they were keen on. Within a further 10 minutes the agent called back and confirmed that Contracts had been exchanged.
When I informed my clients they were absolutely delighted because they did not originally believe that I could secure the property for $575,000 with a 5 day cooling off period! A copy of their testimonial can be found here.