How it works
Leveraging the power of bulk buying by collectively negotiating a discounted wholesale rate with a builder or developer.
This creates instant equity from day one creating unique financing opportunities for investors to recycle that equity.
Why would a developer want to sell in bulk, won’t they lose money?
In most cases the opportunity comes from a seller who is distressed and needs to sell quickly.
Often developers or builders run into financial difficulty. By presenting a bulk buy offer the properties can be quickly sold alleviating their cash flow problem.
How you can apply this principle
- Get together 5 or more friends.
- Approach builders or developers who are selling new stock.
- Negotiate a wholesale purchase price for buying 5 or more.
- Aim for a minimum discount of 10%.
- Find an independent valuer to ensure the price is below market value.
- Work with an experienced specialised finance broker that will structure your loan.
Word of warning
Be cautious of real estate agents and developers who will often flaunt a valuation that is above the sale price.
If one particular valuer happened to over-estimate the prices you could get caught out and pay more than you should, be careful of this.
However for a valuer to over–estimate 10+ properties they won’t be in business for long if they’re making mistakes like that.
Alternatively, you can enquire how you could use APPA to help facilitate to this for you.