Preparation
Create a household budget to help determine manageable loan repayments. Be prepared for “hidden” costs of purchase including solicitor’s fees, building inspections and taxes.
Finance
Your mortgage provider will advise you on how much you can borrow. It’s important to have your finance in order before you start looking to avoid disappointment. Request a letter of approval from your lender, which may be required at auction.
Wish List
Make a detailed list of all your requirements including location, size and features. The more accurate your list, the more refined your search will be, saving you valuable time and energy. Prioritise your list as this will help better qualify your choices.
Research
Ask your sales agent for a list of recent sales in your preferred area. They can also provide valuable locality information including schools and facilities. Try to attend inspections and auctions in your area to get a feel for the marketplace.
Inspections
Once you have found your ideal home, we recommend you arrange for a building and pest inspection. This helps to ensure that you don’t inherit costly repairs.
Sale
Once you have found your ideal property, you may decide to pay the asking price or make an offer, dependant on your opinion of its value. Ask your agent to send a copy of the contract of sale to your solicitors. Remember, the agent is acting in the best interests of the vendor, so if you’re making an offer less than the asking price, you may risk losing the property. Once an agreed price has been reached, it is usually best to exchange contracts as soon as possible.
Auction
At an auction, all interested parties have the opportunity to put their best offer forward. This method is the best and fairest way to sell a property that is expected to generate much interest. To familiarise yourself with the process, it is wise to attend as many auctions as possible before your sale date. If you are unfamiliar with this method, you can authorise someone to bid on your behalf.
New laws, which came into effect on 1.9.03, affect all agents and bidders at auction in NSW. Mostly, they are designed to help eliminate ‘dummy bids’ and agents falsely understating prices. These laws have gone a long way to increasing buyer confidence in the auction process. One such rule requires all bidder’s register with the selling agent/auction house before auction. If you would like to read more on these new laws, the details are outlined in the Department of Fair Trading Bidder’s Guide
If you have decided to buy a property that is to be auctioned, discuss your interest with the listing agent well ahead of the auction date. They will guide you through each step and help you prepare for the day.
Overseas Buyers
Overseas buyers must seek approval from The Foreign Investment Review Board (FIRB) before purchasing real estate in Australia. Some rules and requirements apply to foreign investors, however, these rules do not usually apply to Australian’s living overseas.
Purchase
Now that your offer is accepted, a deposit will be required, usually 10% of the acquisition price. At this time, your solicitors will sign and exchange contracts between you and the vendor and a settlement period will be agreed upon, an average of sixty days.