{"id":8510,"date":"2016-07-11T01:00:38","date_gmt":"2016-07-10T15:00:38","guid":{"rendered":"http:\/\/realestatetalk.com.au\/?p=8510"},"modified":"2016-07-11T01:00:38","modified_gmt":"2016-07-10T15:00:38","slug":"off-the-plan-finance-pre-approvals-mark-mendel","status":"publish","type":"post","link":"https:\/\/channels.realty.com.au\/realtytalk\/off-the-plan-finance-pre-approvals-mark-mendel\/","title":{"rendered":"Off the plan finance pre approvals &#8211; Mark Mendel"},"content":{"rendered":"<p>&nbsp;<br \/>\nLenders should be required to provide off-the-plan apartment purchasers with a funding pre-approval that will last them until settlement according to iBuyNew CEO <strong>Mark Mendel<\/strong>. He explains that if banks are prepared to fund a development for construction, then they should take the same stance on providing finance when it comes to the buyers of those apartments. Hear Mark\u2019s thoughts on that and the other challenges facing the off the plan market right now.<br \/>\n&nbsp;<\/p>\n<h4><strong>Transcript:<\/strong><\/h4>\n<p><b>Kevin:<\/b>\u00a0 I mentioned before the break I wanted to talk about off-the-plan sales, but there is another aspect to this that I want to talk about, as well, too. Lenders should be required to provide off-the-plan apartment purchases with a funding pre-approval that will last them until settlement. That\u2019s according to a leading online property agency, which is called iBuyNew. Their CEO Mark Mendel joins me.<br \/>\nMark, this of course is a major problem looming for developers, isn\u2019t it? And that is, the funding of off-the-plan sales and whether or not purchasers will be able to settle.<br \/>\n<b>Mark:<\/b>\u00a0 Yes, it is Kevin. Hi. How are you?<br \/>\n<b>Kevin:<\/b>\u00a0 Good, mate. Thank you. And thanks for joining us.<br \/>\nTell me what your proposal is and what sort of traction you\u2019re getting for it.<br \/>\n<b>Mark:<\/b>\u00a0 It\u2019s been brought to light, I guess, as the lending policies have changed over the last six months and they\u2019ve become very tough very quickly for a lot of buyers. When a buyer is purchasing an off-the-plan apartment or a townhouse, it can be a lead time of anywhere from six months to 2\u00bd years potentially when settlement will take place. The buyer might be in a position today under the current policies to be able to settle on that property, but in 18 months\u2019 time, policy changes may be different.<br \/>\n<b>Kevin:<\/b>\u00a0 The banks have really tightened up, too, haven\u2019t they? We\u2019ve seen these moves by state governments \u2013 more recently, Queensland but in particular New South Wales and Victoria \u2013 making it tough on foreign buyers, too.<br \/>\n<b>Mark:<\/b>\u00a0 Yes. I think they\u2019ve gone too far. I think foreign buyers should be paying some form of additional stamp duty.<br \/>\n<b>Kevin:<\/b>\u00a0 Why do you think that, Mark?<br \/>\n<b>Mark:<\/b>\u00a0 If they\u2019re<b> <\/b>putting their money into Australia and they\u2019re buying ahead of an Australian who\u2019s missing out potentially, that additional stamp duty can be used to help the communities where they\u2019re buying property. So additional parklands, upgrades to roads, etc. Why not give the local community the benefit of that while the foreigners might reside overseas? They\u2019ve had the benefit of moving their money out of the country that they\u2019re living in, investing in a stable political economy such as Australia, getting the returns that they\u2019re after. Why not give something back to the community at the same time, as well?<br \/>\n<b>Kevin:<\/b>\u00a0 Yes, fair enough. But do you think 3%, which is what they\u2019re proposing in Queensland, is too far?<br \/>\n<b>Mark:<\/b>\u00a0 I think today it is, because the Queensland economy has really taken a hit over the last six months. But they could have done it at 1.5% to start off with and then raised it over time. You have to remember in Queensland you\u2019re still paying another 4.5 odd percent stamp duty as a local buyer where if you look at Victoria, when you\u2019re buying off the plan you pay next to nothing in stamp duty. So they can raise that additional stamp duty to 7% because there\u2019s really no other stamp duty to pay.<br \/>\n<b>Kevin:<\/b>\u00a0 There is another thing that I wanted to very quickly talk to you about, too, Mark, and get your impression on this and that is off-the-plan sales. They seem to have been tarnished a lot because of the number of spruikers who tend to lean in that direction \u2013 in other words, this is the sort of stock that they sell \u2013 which to me seems very unfair because there are some very, very, good developers around Australia. Pellicano is one that I\u2019ve mentioned this morning. They have a great reputation and you know if you\u2019re buying through them, these guys don\u2019t sell through spruikers; they have their own sales people.<br \/>\n<b>Mark:<\/b>\u00a0 Unfortunately in the real estate game there is a lot of money to be made by spruikers, which is why they\u2019re there in the first place. Our company, iBuyNew, when we sit down and we talk to a developer, it doesn\u2019t matter whether they\u2019re ASX-listed or a one-man band, we do our due diligence on them and we make sure that they\u2019re going to deliver the product they say they\u2019re going to deliver and that our clients will end up with the right product.<br \/>\nI think the message to buyers who are looking off the plan is it\u2019s not a problem as long as you\u2019re buying through the right company. Unfortunately a lot of people are not educated enough about it and they go to a spruiker who ends up selling them something that\u2019s overvalued.<br \/>\nIf I look at our last 700 transactions at iBuyNew, I think less than 1% have come in under value, which is a pretty strong record in the industry.<br \/>\n<b>Kevin:<\/b>\u00a0 A very strong record, yes. Good mate. You\u2019ve made some very good points. iBuyNew.com.au is the website. Mark Mendel is the man.<br \/>\nMark, thanks for your time this morning.<br \/>\n<b>Mark:<\/b>\u00a0 No problem. Thanks, Kevin.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>&nbsp; Lenders should be required to provide off-the-plan apartment purchasers with a funding pre-approval that will last them until settlement according to iBuyNew CEO Mark Mendel. He explains that if banks are prepared to fund a development for construction, then they should take the same&#8230;<\/p>\n","protected":false},"author":176692471,"featured_media":8520,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"_jetpack_feature_clip_id":0,"_jetpack_memberships_contains_paid_content":false,"footnotes":"","jetpack_post_was_ever_published":false},"categories":[34,10,11,13,36,25],"tags":[101],"class_list":["post-8510","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-finance-topic","category-kevin-turner-sponsored-channels","category-kevin-update","category-latest-story","category-property-investment-topic","category-sponsored-channels","tag-podcast"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v27.8 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>Off the plan finance pre approvals - Mark Mendel - Realty Talk<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/channels.realty.com.au\/realtytalk\/off-the-plan-finance-pre-approvals-mark-mendel\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Off the plan finance pre approvals - Mark Mendel - Realty Talk\" \/>\n<meta property=\"og:description\" content=\"&nbsp; Lenders should be required to provide off-the-plan apartment purchasers with a funding pre-approval that will last them until settlement according to iBuyNew CEO Mark Mendel. 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