07 3555 6333Investor sees 8% increase despite termites
Long time property investors “Billy and Marge” have been building their property portfolio to fund their future, and their latest rental property acquisition was in the western Brisbane suburb of Rocklea. They were very pleased with the great deal they negotiated on this property, and had rented it out quickly.
A new and unwelcome experience
As long-time investors with a lot of experience in the property investment area, Billy and Marge had no experience with property resumptions. Like many property owners in the area, they were understandably quite upset to receive a notification from the Department of Transport (TMR) that their property was to be resumed to build a new intersection and railway station. It was part of the Queensland Government's efforts to upgrade train lines so that high speed trains could travel on pre-existing infrastructure.
Realising that they needed help, they contacted NPR Law and sought the services of a Valuer to help ascertain the value of their property.
A nasty surprise
Due to time constraints, TMR’s Valuer and Billy and Marge’s Valuer needed to inspect the property at the same time. The Department also had a Building and Pest Inspector onsite during the inspection.
The property was rented, and was frankly quite a mess. To everyone’s surprise, including Billy and Marge, the Building Inspector pulled a couch back from the wall to reveal a large hole. Upon closer inspection it became apparent that the hole was caused by termites.
Complicated negotiations led to a good outcome
Termite damage requires significant repairs to a property and is a costly exercise. Negotiating this deal was going to be complicated by this factor.
TMR wanted to deduct the value of the repairs from any settlement.
After many hours of negotiation, and a meeting with all of the parties, the Valuers were able to agree on a figure that was 8% higher than the amount that TMR’s Valuer originally wanted to give the property. On top of that, the 8% was more than the decrease in the value of the property based on the termite damage.
Billy and Marge were then able to buy another investment property that achieved a greater rental return than the one that had been resumed. Since then, Billy and Marge have continued to build their property portfolio and to build a source of income that is above their income.
Getting professional help really paid off
Even with significant damage, engaging NPR Law and their own Valuer made a big difference to the outcome that Billy and Marge were able to achieve. It really was worth it for them.