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  • #11856
    Harriet2911
    Flatchatter

    Hello,

    Been looking for a while for an apartment in Sydney’s east. 

    We’ve finally located the perfect place for us, only to find a big potential hitch when we read the strata report.

    A number of the owners have got together and submitted a formal proposal for a collective sale. 

    The strata committee has “opted in” to the process and formed a strata renewal committee to investigate further. (So they are up to #3 in the process, as outlined at the Fair Trading web site: https://www.fairtrading.nsw.gov.au/housing-and-property/strata-and-community-living/strata-schemes/collective-sale-and-renewal)

    We are wondering if it would be wise/unwise to buy into a building when this process is underway, but as yet undecided.

    The real estate agent is hard-selling us on the potential of a “huge” windfall if the collective sale goes ahead, but we would probably lose at least some of this – because we would not be able to live in the apartment straight away. It has tenants in place until May net year, so I guess if there was an eventual sale, we would lose some of that in capital gains tax.

    Anyway . . . it’s all sounding a bit too complicated for us, but I would certainly welcome your thoughts. I am sure there are people here who know far more about this than me!

    Cheers.

Viewing 3 replies - 1 through 3 (of 3 total)
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  • #30308
    Harriet2911
    Flatchatter
    Chat-starter

    Thanks for your responses.

    Flame Tree, they are all questions I have asked myself! I am not motivated by money. What I am looking for here is a home. We have some fairly strict criteria, and this place meets all of them – apart from the uncertainty of not knowing what will happen with this collective sale. So . . . bummer.

    Jimmy, we have already done the forensics. The only thing that came out of that was the collective sale. I have seen the formal proposal, and there was nothing to suggest the motivation was anything but opportunistic – i.e. to take advantage of zooming property prices in the area. (Though there has been a slow-down since then.)

    Anyway, even knowing all of the above, something just doesn’t smell quite right here. The property is reasonably priced, yet has been on the market since January. So there could indeed be something else afoot. I should listen to my intuition, I guess.

    The home hunt continues . . .

    Cheers.

    #30304
    Jimmy-T
    Keymaster

    I would want to know why the rest of the owners are thinking of selling.  Is it opportunistic or are there problems that they have been keeping quiet (until your vendor has sold) that they can’t afford to fix?

    The tax issue is a trade-off and you should get advice on that. But I would be asking your conveyancer for a forensic study of the strata minutes before getting the chequebook out.  And talk to the other owners if you can – they might know why the vendor is selling at such an odd time.

    #30297
    Flame Tree (Qld)
    Flatchatter

    If it was so good why are the owners selling it, and why has the agent not bought it himself? But, these things don’t always get off off the ground so how would you feel if it did? Would you potentially make a few bucks but miss another opportunity you could have gone with hassle free now? And if it does what will you do next? I’ve learnt not to do things for money only as they never mostly come off. It’s an interesting dilemma.

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