second thoughts

iggy

I have purchased a 2 bed apt in Adamstown with the gf which is due to be ready in the summer.
I have 20k deposit paid and have signed the first part of contract.
Is it possible to pull out now and get full refund?

We were only going to stay in it for a couple of years but all the talk lately I dont think its such a good idea.

We are living in my house atm and I was going to let my house for the couple of years and then sell the 2 properties and buy one property.

Any ideas on the above?

Thanks

rsta

I'd say you could probably pull out by now. Ring your solicitor they'll tell you for sure.

Not sure if I would pull out though, would you get a good rental on either property? What are 2 beds in adamstown renting for now? Good luck whatever you do.

antoinolachtnai

Why not ask your solicitor? He should really have discussed this with you ...

Chances are: if there is a market for your apartment, then you will be able to get out of it for a few percent of the purchase price. If there isn't a market for it, then you're looking at losing the deposit.

Personally, I'd stay the course if your circumstances haven't actually changed.

miju

it depends on what esxactly has been signed on in the contract so you will need to check with your solicitor about how much you stand to lose (if anything at all) by pulling out

best of luck hope it works out either way

iggy

I rang the selling agents and they said that the contract i signed was a binding contract and i would lose deposit if i pulled out.

Looks like i'll just go for it and hope it works out.

Thanks for all feedback

Ste.phen

Of course the selling agents will say that, talk to your own solicitor, there could well be a way out of it without losing the deposit.
A few others mentioned renting it out, which could be a possibility, hell, you could even sell it on for the same price you're paying for it, maybe + a few percent to cover fees

antoinolachtnai

Yup, talk to your own solicitor. There was a thread about this where there was a long discussion some months ago. I felt that under the EU consumer directive, they could only hold on to a reasonable amount of the deposit, not the whole lot. Other people disagreed with me (as they are entitled to).

One thing to refer to is http://www.odca.ie/cfmdocs/b_query/unfair2.cfm - check the paragraph in bold referring to clause 10, where the odca argues (rightly in my view) that clauses that forbid assignment by the consumer, but allow assignment by the builder are unfair.

If you were able to assign your contract to someone else, it would allow you a way to sell the contract on to someone else without incurring any stamp duty.

That is all suggestions of places to look from a legal point of view to minimise your loss if you decide to pull out (although it's certainly not legal advice and you should go to your solicitor for that).

On the commercial side, I'd say your original overall strategy sounded ok to me. Assuming you've been in your present house more than 5 years and that you can make the payments, you should still seriously consider buying this property.

Antoin.

patrickolee

iggy wrote:

I rang the selling agents and they said that the contract i signed was a binding contract and i would lose deposit if i pulled out.

Well they would be slightly biased. To know for sure, you probably would need to take it to a solicitor, paid by you.

But I wouldn't let that TV programme sway you either way. As everyone before has said, if your circumstances haven't changed your plan still sounds good.

Good luck either way, it will all work out.

dats_right

Your solicitor will tell you that unless there was a Special Condition inserted into the Contract for Sale/Building Agreement providing otherwise or, if you fail to reach some sort of agreement with the vendor then you will lose your deposit (there are also some other remedies available such as specific performance i.e. seeking a court order to compel you complete the transaction and in certain circumstances a vendor may also pursue you for damages), although happily neither of these latter two remedies are often invoked in practice.

Whilst I obviously can't state with any degree of certainty in this case, I would be most surprised if the vendor builder agreed to any special condition permitting you to change your mind and/or get your deposit back. I see dozens of contracts for sale/ building agreements every week and I don't ever recall seeing one where a vendor had agreed to same (well certainly not a builder anyway!). Effectively, what this means is that in all likelihood your best bet is to try negotiate with the builder seeking to get yourself released from your contractual obligations. Unfortunately, from your point of view, there is no obligation here whatsoever on the vendor/builder to accommodate you, rather it will depend entirely on their good nature or otherwise.

Certainly Antoinlachtnai makes an interesting argument for a possible 'way-out' for you. In particular, regarding the possibility of assigning your interest to a 3rd party. Ideally I would think it best if you could get the vendor/builder to agree to such a course of action. Anyway, it is certainly something that you could explore with your solicitor, but I wouldn't necessarily get my hopes up if I were you either.

As it happens and I would apologise for going over old ground, but I would think it highly unlikely that the Courts would agree with Antoin particularly regarding the deposit issue. Principally as the clause regarding the forfeiting of deposits is a standard clause inserted by the Law Society Conveyancing Committee into their standard General Conditions of Sale. After all, we aren't talking about some draconian special condition unilaterally inserted into the contract, we are talking about a universally accepted and well known general condition present in virtually all contracts (save where agreed otherwise).

Somewhat importantly in my opinion, I think it most relevant to point out that the experts on this committee did not draft these conditions from either a pro; vendor, builder or purchaser stance but rather they attempted to recognise, balance and protect the respective rights, interests and duties of both parties. Remembering also that both parties can and do freely negotiate 'at arms length' advised by their respective solicitors, it is always open to either party to seek to insert a special conditions regarding the non-forfeiting or reduced forfeiting of the deposit should the purchaser pull out of the transaction. This is particularly true in a seemingly slowing market, where vendors may now have to consider such steps if they want their properties to be sold quickly.

Oh and by the way, none of what I have stated should be construed as offering legal advice of any sort, for that as other posters have previously suggested, you will need to discuss matters with your solicitor.

antoinolachtnai

dats_right, I know we disagree on this and I am glad you have presented your more conservative view. What if there was a special condition forbidding the purchaser from assigning, do you think that that could be overturned in Court (not that anybody wants to go to court)?

Anyway, in practice the OP will find that if the property has become more marketable in the meantime breaking the agreement will be easy enough to negotiate, with a fairly small penalty. This is the best case. If it's become less marketable, then the OP is quite likely going to lose most or all of the deposit.

The_Conductor

Even if there is a right on the part of the purchaser to reassign- why would another purchaser agree to this, when the effective purchase price of property is falling and they can now most probably get the same or a similar property straight from the builder at a lower price (or with other goodies, such as a more generous fit-out budget or First 6/9/12 months of mortgage to be paid by the builder- as is now happening in Adamstown).

Its all well and good trying to renegotiate contracts in a rising market, when the asset under contract is rising in value, its a totally different kettle of fish in a falling market.

antoinolachtnai

I don't really know the situation out in Adamstown. If the price is dropping as you say, you are obviously right, it will be tough to find a willing buyer.

You could assign the contract to them at a lower price than you paid for it. You wouldn't recover all of your money, but you would recover some. (Of course you might have to pay an agent as well to actually market the property.)

jdivision

smccarrick wrote:

they can now most probably get the same or a similar property straight from the builder at a lower price (or with other goodies, such as a more generous fit-out budget or First 6/9/12 months of mortgage to be paid by the builder- as is now happening in Adamstown).

Think that's in Ongar or Tyrrellstown, not Adamstown

is_that_so

Have a listen to Morning Ireland from earlier this week.

The_Conductor

jdivision wrote:

Think that's in Ongar or Tyrrellstown, not Adamstown

No- Adamstown. The agents who are offering the discounts are Gunne (who coincidentally have just laid off a shower of useless estate agents, according to another thread in this forum). They have quite literally thousands of units that they expected to sell off the plans that are now almost impossible to shift. Following the most recent planning approvals, there are another 14k of unsold dwellings for Adamstown (in varying stages of completion, some not started yet). About 8,000 new properties have been sold there so far. Interest is alleged to have improved since the railway station actually opened- though the locals are moaning about lack of capacity (already).

Bluehair

Given the direction the market is going it could be a lot cheaper to lose the €20k(i.e. pull out and forfeit the deposit) now rather than a lot more later.....