We’re going to look at two things here.
The coronavirus pandemic hit the market hard and cash isn’t as free-flowing as it was, making now the perfect time to renegotiate.
However the situation has affected you, one thing remains the same for all – market conditions have changed. It’s important to recognise that we’re no longer operating in the same market as we were just a few months ago. If you don’t adjust now you could end up overpaying for non-completed deals. Or, you could miss an opportunity.
So, you had an offer accepted back in March or even before that, it was a great deal at the time and it took a lot of work to get to this point. Why backtrack now?
Because a good deal in March probably isn’t as attractive now if you re-do your figures based on the market we’ve come back to. More so than ever, now is the time to make sure you overdo your homework to avoid bad deals that could set you back years.
Look at the deal and all the figures through a new post-pandemic lens and review your offer if the deal is no longer as attractive. There’s likely to be less competition from other investors now too which puts you in an even stronger position.
Renegotiate and if the vendor won’t budge and the numbers don’t stack up based on your initial offer, it might be best to walk away.
That’s because you can…
The same applies here and it’s likely something a lot of investors will overlook. We’re in a different market and vendors need to set different expectations for the sales price they can achieve. It’s also likely that some sellers are now more desperate than they were to offload their property putting you in a strong position to do a deal.
Offers you had rejected earlier in the year may well be a win-win for both parties now. Have a look at the offers you put in, see which properties are still available and still appeal. Put in new offers. You’ve done the work to find these potential deals in the first place, this is your second chance to make them happen and you might even agree better terms this time.
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-Janice Minihan, director and co-founder of Property Deal Store