Buying a property can be very challenging. You are usually emotionally involved, you are competing against other buyers and you are governed by your finances. But if you get organised, do your research and become well informed on the process, then you’re in the best position to become a successful home-owner.
DECIDE WHERE YOU WANT TO BUY
Make a list of the areas where you would like to purchase. This may be governed by items such as public transport, good schools, environment etc. Then make a list of essential features that the property must have. Then, make a wish list of non-essential features that would be great, but not strictly necessary.
RESEARCH THE MARKET
You’ve decided where you want to live, now you need to understand the real estate market in that area. Keep track of what properties are selling for – particularly homes that meet your essential features list and budget. Sign up to PropertyNest’s Property Alert and you will be emailed details of properties that match your requirements when they are put on the market. If you like, you can also receive auction results and sold property results – it’s a great way to understand how the property market is performing in your area.
REVIEW BUYING REQUIREMENTS
After you’ve researched the market you probably will have a better idea of what sort of property you can afford and your essential requirements may have changed. If you’ve already subscribed to our Property Alert, you can change or add to your requirements at any time by logging into your account. This way you’ll receive relevant properties as soon as they are listed, simplifying your property search.
ORGANISE FINANCE APPROVAL
Most people have to borrow to purchase a property and if this is the case for you, make sure you organise your finance before you start seriously looking at properties to buy. This way, you know how much you have to spend and you can make an offer as soon as you find your dream home. Don’t forget to factor in costs such as legal fees, stamp duty, insurance and loan application fees. If you have not already organised your finance, email our PropertyNest Finance Expert. Our Mortgage Brokers have access to Australia’s leading banks and can help you find the best loan.
When you find a property of interest, go to the advertised open for inspection and have a thorough look around. If you can’t make a designated open time (or if no open time has been scheduled), call the real estate agent who is managing the property to see if a private inspection can be organised. For security reasons, photo identification is required for anyone attending a PropertyNest open, so don’t forget to bring ID.
You should make several visits to a property before deciding to buy it. Take a notebook (or tablet) and note any features you liked or disliked or any queries you may have. Ask the agent for permission before you take any photographs as you are likely viewing someone’s private home.
When you find the perfect property, you should request a copy of the
Section 32 (Vendor Statement) from the managing agent to make sure you are happy with any easements or covenants and also to see what the council rates are for the property and other important details.
The Contract of Sale or Contract Note is another important document as this lists any conditions the seller may have such as settlement dates etc. You should consult with your solicitor or qualified conveyancer to get advice on the Contract of Sale before purchasing the property.
BUILDING AND PEST INSPECTIONS
Buyers are entitled to organise a Building Inspection where a qualified building inspector, surveyor or architect inspects the property and provides an inspection report.
We recommend that you engage an inspection service with full professional indemnity insurance. This will protect you if the inspection misses a problem that must be fixed.
You should also consider a Pest Inspection to investigate pest concerns, e.g. termites. These inspections are organised through the managing agent (who will liaise with the seller for a convenient time) and are at your own cost.
MAKING AN OFFER
For properties being sold by Private Sale, or by Negotiation, you will need to make an offer if you want to buy the property. For properties being sold by Auction, you can make an offer before the Auction if the sellers have instructed their agent that they are happy to consider prior offers, but the offer would have to be accepted by the seller/s for the property to be sold before auction and they still may decide to take the property to the scheduled Auction day, even after considering prior offers.
Everyone wants to pay the lowest price possible – but offering a lower price and being prepared to negotiate upwards does hold the risk that if the seller has several offers they made decide to accept a higher offer without giving other parties the opportunity to offer more. The real estate agent is under no obligation to go back to you for a higher offer if the seller has agreed to accept another offer. Talk to the PropertyNest managing agent about property values of similar homes in the area, this may help you make an offer that is more likely to be accepted.
A seller may reject an offer for reasons other than the price – including the conditions placed on the offer. For example, a seller might reject an offer conditional on a longer settlement period, if another potential buyer offers a similar sale amount but can settle sooner, or the seller may accept the offer where the finance is not conditional.
You can engage a buyer’s advocate or other professional to bargain for you. You can expect to be charged a fee for this service.
If you are the successful purchaser you will need to pay a deposit at the time of sale. This is generally 10% of the sale price, however may vary. The deposit should be confirmed in the contract of sale, or the managing agent will be able to clarify this for you. All deposits are held in the office’s non-interest bearing Trust Account until they are released to the vendor at either settlement.
Purchasers are entitled to inspect the property in the days before settlement; this is to ensure the property is in the same condition as when it was purchased and that all inclusions are available as per the Contract (e.g. dishwasher).
Pre-settlement inspections should be organised through the managing agent.
Even though the seller’s insurance may cover the property up to the date of settlement, your lender will recommend you take out building and contents insurance effective from the date the seller signs the contract. This is to safeguard their interest in the property, as well as your own.
Your legal representative will instruct you on the procedures for Settlement. This is an official process usually conducted between legal and financial representatives of the buyer and seller.
At settlement, all outgoings such as rates and other charges are adjusted between the seller and the buyer.
The seller is responsible for rates up to and including the day of settlement. The buyer is responsible from the day after settlement.
Once the Settlement has taken place the seller’s legal representative will send written confirmation to the managing agent to confirm the Settlement has been finalised.
Please note that keys cannot be released until the managing agent has received written confirmation of settlement from the seller’s legal representative.
We strongly recommend you contact the office before dropping in to collect the keys, to ensure that settlement has not been delayed and that they have received confirmation of settlement.
WE ARE HERE TO HELP
If this all sounds very daunting, don’t worry, we will help you through the process.