Put and call options property


If you're looking to buy and develop residential property, or to sell your property to a developer, an option agreement may suit your circumstances. You should engage a solicitor to correctly draw up the option agreement and guide you through the process of creating and exercising the option. Brown Wright Stein has an experienced property team which is able to assist you with all matters involving options over residential and commercial property, as well as conveyancing, leasing and property development matters.

Snezana Vojvodic heads up the commercial dispute resolution team at Brown Wright Stein. Will there be an early election? Keep your options open: Deborah Kent, Ryan Miu Date: When buying or selling residential property, sometimes you also need to buy more time. In these situations, you might consider using an option agreement to protect your position.

What is an option? Options come in two forms. It is not sufficient for both parties to sign the one document; if an option agreement creates both a put and a call option, both options must be given for consideration. If you're looking to buy and develop residential property, or to sell your property to a developer, an option agreement may suit your circumstances. You should engage a solicitor to correctly draw up the option agreement and guide you through the process of creating and exercising the option.

Brown Wright Stein has an experienced property team which is able to assist you with all matters involving options over residential and commercial property, as well as conveyancing, leasing and property development matters. Snezana Vojvodic heads up the commercial dispute resolution team at Brown Wright Stein. Will there be an early election?

Keep your options open: Deborah Kent, Ryan Miu Date: When buying or selling residential property, sometimes you also need to buy more time. In these situations, you might consider using an option agreement to protect your position. What is an option? Options come in two forms.

It is not sufficient for both parties to sign the one document; if an option agreement creates both a put and a call option, both options must be given for consideration. The body of the Option Agreement, which outlines the terms on which the parties may exercise their option; and The sale contract as an annexure to the Option Agreement. The Contract will often have all details and terms finalised, including the Purchase Price and length of contract.

On exercising an option, both parties will need to sign the agreed sale contract. Option Fees and Deposits The purposes and type of Option Agreement will determine what is a reasonable basis for requiring option fees or deposits to be paid. For example, an Option Agreement may provide that: The commercial basis for having a Call Option Fee is that the Seller is taking the property off the market for 6 months, without being guaranteed a sale.

Triggers for Options Option Agreements may have set time frames during which a party may exercise its option, or otherwise the option periods can be triggered by certain events for example, the Buyer obtaining a development approval. Nominees Option Agreements can also allow for the asset to be sold to another party on exercise of the option.

Why use Option Agreements? There are many reasons why Option Agreements can be beneficial or necessary. Practical reasons — for example, where a property developer wishes to lock in the option to buy a property at a set price, but subject to its right to obtain development approvals for the land and determine a final buying entity; or Tax reasons for long sales — using an Option Agreement can defer tax or duty liabilities until a period more convenient for one of the parties, such as the next financial year for CGT purposes, or closer to the anticipated settlement date.

A Option can be attractive compared with using a long term unconditional sale contract.