Browse Forums Home Finance 1 Mar 03, 2013 5:15 pm I am wondering if people have any experience or advice on how to go with purchasing land before the settlement of the house that we are selling? (We are living in the house we are selling and don't want to rent it out or keep it while we build.) I know that 'subject to buyer's choice of finance' clauses are standard in real estate contracts, but would that cover us if for some reason after we signed for the sale of our house, the sale fell through for some reason? Hope this makes sense, we wouldn't be looking for land seriously until the house sells but I guess it is better to wait for settlement to avoid and potential problems and financial pressure? Our build: viewtopic.php?f=31&t=64705 Re: Buying land before settlement of current home?clauses? 2Mar 03, 2013 9:21 pm Hey Meowsy Good Question, the finance clauses is the key here. You could sign a contract subject to the sale of your house; this protects you ... if your house doesn't sell. 'Subject to buyer's choice of finance' wouldn't help as you would still have a finance date/ clause to meet. But you could sign a contract with a longer settlement date i.e. Two weeks for funding and six weeks for settlement?? Depends on the vendor. I know people who purchase land prior to the sale of their property and carried the vacant land loan for 6 to 12mths and then felt pressured to drop their property price to start building. For example purchased a vacant block of land for $200,000-00 borrowed the full amount (using equity in their home) Interest Rates around 7% (Cost around $10,000 in interest for the 8 ½ months till they house sold). The property market fell, so they drop $50,000 of the sale price …. To rub salt in …. The To Be Erected valuation came in lower due to the weaker market (the land was valued at $185,000). Is your place on the market? Is it priced to the market to sell? Is more land coming on in the sub division? Avoid bridging finance if you can, this only adds increase stress to sell. Cheers Stig Re: Buying land before settlement of current home?clauses? 3Mar 04, 2013 6:45 am Thanks for the input. What you are saying makes total sense. I don't really want the added pressure as you have described. From what I gather many developers won't put the subject to sale of house clause, which I guess is fair enough. House soon to be on the market, have given the agent the go ahead over the weekend. (when you mean priced on the market to sell, do you mean in relation to comparable properties etc? If so, then yes I believe it is). There will be more land released over the coming months in this estate so there is no real pressure I suppose. I guess we will hope the house sells quickly and go for a 30 day settlement, then these problems are avoided! Not interested in a bridging loan whatsoever. Our build: viewtopic.php?f=31&t=64705 isn't a garage level with the rest of the house a given? pretty sure they 'came around' long time ago. if you have a flat block, the garage is usually level with the rest… 1 18523 2 6769 Hi Everyone, wondering if anyone has done a prestart lately with summit homes in WA and what kind of costs were associated with adding gpo's and downlights? we are also… 0 4129 |