Advice Needed: Let Go of Land Deposit in Cloverton or Stick with It

AliKay on 23/02/2020 - 16:20

Hi guys,

Need some serious advise as the situation is causing a bit of stress.

We put 5% (18K) deposit on a 448sq land in Cloverton Melbourne at the end of 2018. The land prices were high at that time and the lot we bought is supossedly in a premium release of the estate.

At that time we didnt really made any efforts in researching much because we only afforded 5% and Cloverton was the only estate offerring land at this amount.

The land is set to title in Oct-Dec 2020.

Fast forward 2020, we have started having this real bad and disappointing feeling that we made a mistake and have this feeling that Cloverton is too far away from CBD where I work and kids are already set in the school. We've made the drives to Cloverton and it really feels like forever just to reach the estate entrance.

We now feel that there are better options than Cloverton, like Wollert and Epping and some other closer estates compared to Cloverton.

Furthermore, income situation has also improved since wife has started working and we have been able to save more then what we expected earlier.

Now please advise if we should let go of the 18K and start looking something in a closer estate which would be more suitable for our situation and satisfy us in the long run or just go with the lot in Cloverton and do the extra commute day in day out for the rest of the years to come.

This may be our 1st and only house that we will be building.

Withthe current market situation, I don't believe we'll be able to sell the lot as a quick search shows hundreds of lots advertised already and probably no buyers.

Is there any other advice that someone would like to give. Will there be any other negative implications on our credit rating if we let go of the lot deposit. Anything in favor of Cloverton or other estates to help us ease the stress in our minds? Really appreciated.

Regards

Financial

Comments

  • [Deactivated] on 23/02/2020 - 16:52
    +1

    How quickly can you save up $18k again

  • Ughhh on 23/02/2020 - 17:03
    +1

    At that time we didnt really made any efforts in researching

    Hope you've learnt your lesson, because theres more to lose if you don't. It sounds like history is about to repeat itself.

  • bobbified on 23/02/2020 - 17:31
    +6

    Does your contract say that it'll only be the $18k deposit you will lose if you choose to cancel?

    Realistically, $18k isn't that much in terms of property value so if you don't want it, better to cut your losses now. Personally, I would sacrifice that $18k and actually buy where I want to live rather than spending another few hundred thousand building somewhere I don't want to be.

    • [Deactivated] on 23/02/2020 - 18:31
      +1

      $18k is not a lot for an exit clause. I'd exercise that clause.

    • djkelly69 on 23/02/2020 - 19:50
      +1

      I would strongly doubt that is what the contract says.

      More than likely you will be on the hook for (if the developer chooses to pursue it) the extra 5% up to 10% of the price, as well as damages if they make a loss on resale, extra agent and legal fees, etc.

      Speak with your solicitor/conveyancer ASAP.

      I think you can nominate a new buyer fairly easily in Vic without incurring double duty, so that may be something to explore.

  • arkie0 on 23/02/2020 - 19:41
    +2

    Cloverton is only about 10 minutes freeway time from Epping. Traffic to Wollert from Cooper St will make it the same time wise to Cloverton. You aren't actually saving any time by moving to those suburbs.

    You could always look for a job closer to home?

  • TEER3X on 23/02/2020 - 19:50

    The land prices were high at that time and the lot we bought is supossedly in a premium release of the estate.

    Haven't prices gone up a little since then?

  • ziaxk87 on 24/02/2020 - 01:18
    +4

    Can you build it do a trial… if you dont like it, rent it out after few months??

  • Porker on 24/02/2020 - 11:09

    I can't comment on your location considerations, but if it's your 'forever home', then do what you can to make sure it's as you want it.

    I compromised on a few things with my recent build and unfortunately those things are what I see and hurts most when I look at my home. It might be the same with your location or when you visit Epping or the area you could've lived in but didn't.

    Assuming it's only $18k loss, while it's a lot, it might not be that much in the grand scheme of things and many years you'll spend living in your eventual home.

  • TEER3X on 24/02/2020 - 13:03

    What percentage of rent covers mortgage repayments on a recent purchase and loan? Is it really low?

    I'm not in a position to buy just yet but was wondering if anyone is positive gearing. I understand the numbers are going to be all over the place.

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