Sellers who have been criticized for pocketing a couple’s $ 75,000 deposit say they are “devastated” after an unexpected cost of the debacle.
Queensland home sellers who have been labeled ‘greedy’ for accepting a young couple’s down payment have revealed that they ultimately failed to make huge profits.
The couple – who insist they “didn’t do anything wrong” – were set to walk away with an additional $ 140,000 on the sale of their property in Brisbane after keeping the buyers’ down payment, then resold the house for an additional $ 65,000.
But instead, they told news.com.au that they ended up with next to nothing.
Last week, news.com.au reported that Mark Trau, 30, and his fiancee Maddie Goyder, 27, lost their entire $ 75,000 deposit after their bank, Westpac, missed the deadline. settlement of the Jindalee property they wanted to buy.
Although Mr Trau and Ms Goyder made two requests to extend the impending October 20 deadline, first by a week and then by a day, both were rejected.
Less than 24 hours later, at 11 am the next day, Westpac was ready with all the papers.
By then it was too late. The sellers, a retired couple who have since moved to Western Australia, terminated the contract and took the deposit, as they were legally entitled to do.
They then resold the four-bedroom, two-bathroom home within hours of the deal collapsing for $ 65,000 more than what Mr. Trau and Ms. Goyder had offered.
However, retirees have now told news.com.au that their profits are minimal due to various commissions, fees and a legal disclaimer placed in the contract.
“The [real estate] the agent’s commission, advertising costs, staging fees and legal fees were approximately $ 34,000 for the defaulted sale, ”the sellers told news.com.au.
“We also had to pay realtor and lawyer fees for the second sale (these were about $ 29,000).
“The agents commission was 2.7% for the defaulted sale and the second sale, which means we paid over $ 50,000 in selling costs. “
The sellers also claim they lost “tens of thousands” more in additional legal fees as they had to prepare for a Supreme Court hearing to lift a warning on the property filed by buyers that could have blocked the second. sale.
Mr Trau and Ms Goyder offered $ 965,000 for a four bedroom, two bathroom house in the Brisbane suburb of Jindalee, where they planned to start a family.
However, it didn’t look like Westpac would be ready for the October 20 at 5 p.m. settlement date.
Mr. Trau made “a number of frantic calls” and pleaded with the salespeople, but the sale was ultimately unsuccessful.
In most other Australian states there is a two week grace period if a settlement fails, but not in Queensland.
The sellers took the entire $ 75,000 deposit, leaving the young couple homeless for several days, and sold to someone else.
Hours after the contract collapsed, the house was marked as being sold on a real estate list for $ 1,030,000 – $ 65,000 more than Mr. Trau and Ms. Goyder’s price.
On October 29, nine days after Mr Trau and Ms Goyder lost their dream home, they filed a warning on the Brisbane property.
A caveat is a legal document that protects the interests of buyers by preventing ownership from being transferred to someone else for three months.
Professor William Duncan, an expert in property law at the Queensland University of Technology, said a caveat is standard practice when there is a dispute over a property issue and they are considering to plead.
“This is a typical reaction of a buyer who feels aggrieved,” he explained.
The nature of the warning means that it can only be removed by the Supreme Court, which is very costly.
With their new buyer due to settle the property on November 10, the sellers had no choice but to prepare for legal action rather than wait for the warning to expire.
If they hadn’t, the new buyer could have sued them for having to give up that second contract.
They ended up paying lawyers and a waiting lawyer.
“This was devastating for us as it meant we were now faced with the prospect of potentially being sued by the second buyer as well as being unable to make our own purchase,” the sellers wrote.
“We had no choice but to take legal action. The process of removing this disclaimer was extremely stressful and costly, leaving us tens of thousands of dollars considerably out of pocket. “
Professor Duncan said the fees for a lawyer when a house sells without legal complications are typically around $ 1,000 to $ 1,200, which the sellers likely had counted on when they chose to terminate the contract.
“I probably would have tried to convince them to give the [one-day settlement] extension, ”said Professor Duncan.
“Normally, the sellers would have given them [Mr Trau and Ms Goyder] two more days to settle, but they probably did the sums [and thought] if they don’t pay on time, they can get the $ 75,000 and then the $ 65,000, they are in advance.
He said the sellers got their ‘comeuppleance’ because: ‘They might have gotten only a small benefit from it. [choosing to end the sale], enough to buy only the patio furniture.
The sellers pointed out to news.com.au that they had not decided to terminate Mr. Trau and Ms. Goyder’s contract in order to earn money and said they had “been very accommodating throughout. of the transaction “.
“We have always acted more than fairly towards the couple,” the sellers said in a statement.
“There was no other contract when we made the decision not to extend. This decision was based on legal advice and their repeated failure to meet deadlines, which was a constant feature throughout this process. “
The sellers had previously granted two exemptions to Mr Trau and Ms Goyder at the financial clause stage – where the purchase of the property is only made if they get approval for a bank loan.
The sellers added that they “were devastated by this eleventh hour request as they were to fly interstate the next day and our beloved pet and all of our material possessions had already been packed and shipped. We also had the intention to use this money to settle an interstate purchase ”.
The older couple said they had retirement plans that were on hold as a result.
Professor Duncan said the case has drawn attention to the fact that Queensland’s property laws may need a major overhaul.
“In a sense, it’s sudden death in Queensland. The timing of settlement is critical in Queensland, ”he said.
He said the 14-day grace period granted in other states “prevents that sort of thing from happening. Small things can go wrong, which is not the fault of either party ”.
In other states it takes a little longer to settle in, between six and eight weeks compared to four or five weeks in Queensland.
“The law in New South Wales (and other states) is probably a little better,” he said. “I don’t see anything wrong with a longer period. It has been talked about intermittently for years.
Westpac agreed to reimburse Mr. Trau and Ms. Goyder as they admitted to having made a manual processing error.
This week, Mr. Trau and Ms. Goyder received $ 100,000 from the bank. The cost covered the filing as well as their legal fees. The bank also factored in $ 5,000 each for the stress and anxiety it has caused them over the past few weeks.
A Westpac spokesperson said in a statement to news.com.au: “We apologize for the experience this couple had in trying to buy their home.
“We have reviewed this case and worked with our customers to quickly resolve and correct the issue.
“While we are limited on what we can say due to confidentiality, we will continue to work with our clients to assist them in their home purchase search. “