In all industries, there are innovators who refuse to subscribe to the status quo. Massland is one such pioneer, having insisted on discovering the most efficient and profitable system to achieve the aims of all stakeholders. The result has been the construction of Massland’s reputation as the number one expert and trusted authority in Australia on the successful application of property options.
What is a property option?
A property option is elegantly simple. In essence, it is an agreement between a land owner (vendor) and a developer, which allows Massland to share with you the profits of the finished development, as well as paying you a higher price for your original asset (as compared with selling on the open market). It is a transparent transaction that results in a ‘win win’ outcome.
This is how it works…
An option on a property, is an agreement made between a vendor and a developer to exchange land for an agreed price, at an agreed time. Important to note is that an option enables a vendor to achieve higher than market value for their asset. Also, option terms are usually 24 months, so you do not have to move right away and will have the luxury of plenty of time to find your next property.
Firstly, an agreement between the vendor and developer is secured with the payment of a small option fee to the vendor. Following this, a developer like Massland is granted a certain amount of time to improve the value of the land by obtaining a Development Approval (DA) from Council.
As a vendor, you will be a key beneficiary of the property option, since once the developer has the DA in place, it will improve the value of the property. This will be reflected in the premium (typically well above the market price) that the developer is able to offer you. The property is then sold, as per the initial agreement between the vendor and developer, and construction can commence.
Frequently Asked Questions
“What if the builder goes broke?”
We understand that for many of our clients, their home is their single most important asset they own. We treat it accordingly and have created a fully transparent, reassuringly simple and astonishingly effective development process. First however, it is worth mentioning that we encourage all potential clients to undertake their own due diligence – advice which is applicable to any opportunity where your assets are involved.
With regards to this particular question, we have installed fail-safe measures at various stages in the development process, to ensure we are not affected common problems such as these. Specifically, we address risk with builders and other contractors by refusing to pay in advance. Only once we have received a certificate from a licensed Quantity Surveyor reporting on much work has been completed, do we release funds – never before.
“What if Massland Doesn’t Complete the Transaction?”
In ten years, Massland has not missed a single development approval. A key reason for this is that over time, we’ve acquired highly specialised knowledge on how to best collaborate with Councils. We ethically and honestly meet their needs and requirements (along with our own), by operating within the boundaries they define and to this date, have not encountered an issue in this area.
However, if for some reason Massland did not complete a transaction, the vendor is actually better off. The option would be dissolved and ownership of the site would simply revert back to the owner – however, the site would be returned complete with a DA and the added value that brings.
Delve into the details…
If you’re anything like the thousands of property owners we have worked with to maximise their return on investment, you might be wondering about specifics involved in the development process, or have further questions. If so, please feel free to call us and we’ll be happy to answer you promptly. Connect with us today, either on 07 5531 7822, or via email firstname.lastname@example.org