Is Asking 3-6 Month Settlement Period Too Much

Jackdawson79 on 14/03/2024 - 21:16
Last edited 26/03/2024 - 09:37 by 1 other user

Hi l live in a regional area and plan to put my house on the market, not an auction , l would like to ask for a 3 month settlement period so l would have plenty of time to continue to live in my house while l look for a rental house to move into, l am worried if l only have a 1 month settlement period l might not be able to find a rental house in time. WOuld asking for a 3 month settlement period put off many people from wanting to buy my house and might make it harder to get my asking price

l plan to sell my house,l am thinking of asking for a six month settlement period, do you think that would make it much harder to sell my house , how common is a 6 month settlement period ?

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Comments

  • Slippery Fish on 14/03/2024 - 21:17

    I'd factor it in when making an offer lol

  • Dollar General on 14/03/2024 - 21:18
    +3

    Not as common as 60 days, but it’s common.

  • joka on 14/03/2024 - 21:18
    +7

    Three months is pretty standard. If a buyer asks for less, use it as a bargaining tool to ask for more money.

  • hashtagbargain on 14/03/2024 - 21:19
    +2

    Not an issue, I’ve seen settlement periods of 6 months being accepted too.

  • Jackdawson79 on 14/03/2024 - 21:21

    Thanks 6 months would be even better, if l could say 6 months MAX . but it will be sooner if l find a rental house quickly, you dont think a long settlement period would put many people from wanting to buy a house, would it only be a minority of buyers that wouldnt like it

    • jjjaar on 14/03/2024 - 22:52
      +1

      You can always word it as “x days, or earlier by mutual agreement”

      Then if you find a place earlier, you contact your conveyancer/solicitor and tell them that it’ll be ready sooner and they’ll get in touch with the purchaser to see if they agree. If they do, that’ll be the new settlement date. But they also might not agree if also have to line up moves/selling their own property/ending a lease etc.

    • afoveht on 15/03/2024 - 01:12

      Sometimes it helps the buyer. Friends of mine just sold their place with a 6 month settlement because the buyer wanted it - needed to get some o/s finances in order I think. It suited the friends too with their own plans.

  • garetz on 14/03/2024 - 21:31
    +1

    It depends on the circumstances of the seller, they might want to move out asap and settlement sooner means money in their pocket sooner.

    I do not see a seller wanting a longer settlement period unless they have nowhere else to move to. In which case they must be very underprepared as they are the ones that wanted to sell in the first place.

    If the buyer wants to buy your place usually they want to move into it asap.
    as a buyer i would trust the seller less the longer the settlement period is. So 3 months settlement might lead to making the selling of the property harder than it would otherwise be.

    You should also take into consideration the clearance rate for your area, it might take 1-2 months to sell, maybe longer. I would discuss it with the real estate agent first.

    • jjjaar on 14/03/2024 - 22:49
      +1

      OP is the seller.

      I do not see a seller wanting a longer settlement period unless they have nowhere else to move to. In which case they must be very underprepared as they are the ones that wanted to sell in the first place.

      It’s not underprepared, if anything, it’s better prepared. Selling first means you know where you stand financially, which is extremely important if you’re planning to purchase another property.

  • JIMB0 on 14/03/2024 - 21:47
    -1

    Why sell? Just rent it out and reap the tax benefits while renting elsewhere.

  • Muzeeb on 14/03/2024 - 21:53
    +2

    Our last purchase was a 6 month settlement at our request. Seller was happy and it helped us with the kids starting a new school at the start of the year. Sold our place a few days later to a buyer that wanted a long settlement. Sometimes the planets align.

  • jjjaar on 14/03/2024 - 22:45
    +5

    You’re the seller, you get to decide the terms. Don’t tell buyers it’s 3 months or nothing, get your agent to say 3 months is your preferred, but you’d be open to negotiations.

    You never know whether the buyer is also needing to sell, and 3 months + may be their preferred duration too.

  • freefall101 on 14/03/2024 - 23:10

    Usually sellers want shorter periods because they've already purchased a new properly and want to get out of their old one. I think you'd be perfectly fine wanting longer rather than shorter.

  • Gracey on 15/03/2024 - 10:10

    Another option you could consider (especially if an investor wants to buy it) is a 60/90 day settlement plus a grace period where you rent the property off the new owner.

    It can be written into the contract 'Seller has the option to continue residing in the property after settlement for $X per week, up to a maximum of X days'

  • netjock on 15/03/2024 - 10:12

    If it is your house it is up to you whether to accept seller offer. Most contracts are 60 days. 90 days at discretion of the seller. You can just say 90 days on the contract and 60 days by negotiation.

  • Euphemistic on 15/03/2024 - 12:31

    Its a negotiation. You might find that at point of sale you want a shorter settlement so you can get into a new property quicker.

  • Daniel Plainview on 15/03/2024 - 14:34

    No, I don't think it'll be an issue - while not ideal for some, folks won't be turned off by it unless they already had major misgivings about the property.

    Its what works best for you, your sale, your rules.

  • Jackdawson79 on 26/03/2024 - 08:38
    Merged from 6 Month Settlement Period

    l plan to sell my house,l am thinking of asking for a six month settlement period, do you think that would make it much harder to sell my house , how common is a 6 month settlement period ?

    • holdenmg on 26/03/2024 - 08:45
      +1

      Q1. Yes.
      Q2. It happens.

    • geekcohen on 26/03/2024 - 09:06

      Entirely going to depend on the buyer. Try and be flexible and not be so set on the 6 months.

    • BOGOF on 26/03/2024 - 09:07
      +2

      So, not a three month settlement anymore?
      https://www.ozbargain.com.au/node/836125

      • Muzeeb on 26/03/2024 - 09:14
        +3

        OP used to be indecisive, now they are not so sure.

        • BOGOF on 26/03/2024 - 09:16
          +1

          That makes hesitance, cheers!

      • Muzeeb on 26/03/2024 - 09:25
        -1

        What's your opinion on OP's question?

    • netjock on 26/03/2024 - 09:27
      -1

      Just did a 4 month settlement because buyer wanted it.

      You can throw it out there you want a 6 month settlement and see what the response is. It might even get you a better price because some people might pay more for a locked in now price if they think prices are going up (some people are front running interest rate cuts that might be coming second half of this year).

      With the rental shortage and continued influx of migrants (each to their own regarding opinions) it is working in your favor. In 6 months it might not be if government policy changes on immigration or tax changes come in (example. Victorian land tax etc)

  • Jackdawson79 on 26/03/2024 - 12:11

    lm not selling by auction and l am in no hurry to sell, so l could just wait until l find someone whose both willing to pay my offer price and is willing to accept 6 month settlement , some people might prefer 6 months to give them more time to get hold of the money or the bank loan, the main reason l want long settlement is it gives me plenty of time to find a rental house, which can be hard these days

    • holdenmg on 26/03/2024 - 12:26

      Is the Property on the Market?

      • Jackdawson79 on 26/03/2024 - 12:27

        no , l dont plan to sell for a year

        • geekcohen on 26/03/2024 - 12:31

          A lot can happen in a year. So probably a bit early to be considering settlement periods. The rental market could vary a lot during this time.

        • holdenmg on 26/03/2024 - 13:29

          How much of the renovations you spoke of are done so far?

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