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undertaking an inspection,” Julie explains.
“One of the most obvious problems he
saw on first glance was the rising damp.
He also mentioned that there would be
a great cost in removing the asbestos to
undertake the transformation I wanted.
“He could see the merit in buying the
property for $560,000 with no due diligence
if I were a builder and could undertake the
work myself at cost price, but obviously
I wasn’t a builder so he advised it was
Because Julie had already made a verbal
offer, she believes the selling agent used
this to play her off against another buyer
who’d been deliberating for a while.
Suddenly another buyer was on the scene
and the selling agent immediately stopped
taking Julie’s and her buyers’ agent’s
phone calls, despite the fact she was still
technically in negotiations with him.
“I think when the real estate agent
discovered that I’d approached a buyers’
agent for representation he knew he
couldn’t pull the wool over my eyes any
more, let alone sell me the house faults and
all with no checks in place,” she notes.
“Even though I’d found a potentially good
long-term opportunity, I was walking on a
knife’s edge with the deal. And apparently
there was quite a lot wrong, including
uncertified works that would require
rectification. The asbestos and damp
problems were just scratching the surface.”
Julie has since teamed up with the same
buyers’ agent to buy more properties.
“I guess what I’ve learnt is to do your own
research first, always use a due diligence
clause and get a third party in, so you’re
never made to feel powerless or used
simply as a scapegoat to play off on a price
like I was.” API
In Wagaman, one of Darwin’s northern
suburbs, was a house with some great
potential as a rental, perhaps even as
a dual-occupancy, or so Julie (not her
real name) thought. Little did she know
that the cost of getting it to a rentable
state was far beyond her financial means.
Fortunately she put a halt to the purchase
before there was no turning back.
She shares her experience of what every
buyer should be aware of when property
hunting in Darwin.
The house in question was old,
according to Darwin’s standards – built
pre-Cyclone Tracy. This historic cyclone
rocked the city on Christmas Day 1974,
when the wind force flattened about
80 per cent of Darwin’s houses. This
Wagaman house was in the lucky 20 per
cent – damaged but not destroyed.
While the damage of the lucky 20 per
cent has in most cases been repaired in
the years since, Julie discovered that the
repairs on these houses haven’t necessarily
been undertaken to cyclone standard,
nor would they necessarily meet the
government’s strict building standards
“Thirty-five years ago there were no
certifications required on building works;
there was no clearly outlined process for
builders or handymen to adhere to, so
someone unfamiliar with Darwin’s tough
regulations is easy prey for a Darwin selling
agent,” Julie explains.
In the case of the house Julie was
inspecting – an elevated house on
an 820-square-metre block with four
bedrooms upstairs and living area built-in
underneath – Cyclone Tracy destroyed
the entire top level, including the front
It was clear the top level was rebuilt in
the years following the cyclone; the new
verandah was now a concrete slab and four
bedrooms were built instead of what was
originally probably only three bedrooms.
A new concrete slab ceiling and roof had
been erected and naturally there were also
new walls, plumbing and wiring required.
The real estate advertisement was looking
for offers above $600,000, Julie says.
“I could only offer up to $580,000 but I
thought I’d still call and talk to the agent.
My first mistake was telling the agent how
much I could pay.”
The selling agent told Julie she should
still come and look at the property despite
her maximum offer of $580,000.
“The house had been on the market
a while,” Julie explains. “We met at the
property and I looked around. We talked
price and the agent said he felt confident
he could lower the price to meet my
budget. But when I mentioned that I
wanted a due diligence clause in the
contract to get the building inspections
done and permits checked the agent said
the seller would only accept the offer of
$580,000 if the offer was unconditional.”
Despite this being Julie’s first property
buying experience she sensed the selling
agent was trying to cover up something.
“Why else would he demand the contract
be signed without any conditions?”
Suddenly Julie was feeling powerless and
needed some assistance in negotiating
with the selling agent and undertaking
all the inspections and searches, so she
appointed a buyers’ agent.
By this stage Julie was already imagining
splitting the house into a dual-occupancy
rental for a dual-income stream. She’d
done her homework and knew that rental
demand in Wagaman was strong due to its
close proximity to the shopping centre at
Casuarina just one suburb north and the
Royal Darwin Hospital further north.
“My buyers’ agent could already see
some faults with the property without
WALKING ON A
How did an inexperienced buyer escape the fate of paying
too much for a property that required thousands in repair work?
æMy first mistake was telling the agent
how much I could pay.Æ
\\ MY PROPERTY NIGHTMARE
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