Owning your own home is still one of the great Australian dreams. Whether you are a first time property buyer or a veteran of several properties, the excitement of finding the right home and making that successful offer or bid never wanes.
It's important to first organise your finances to work out how much you can afford before you start looking at properties. You can make the buying process a lot easier by becoming pre-approved, or at least pre-qualified with a lending institution. You'll then know at what price range to start looking...
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Apart from your mortgage repayments, there are other costs to consider in purchasing a property:
Do you qualify for the First Home Owners Grant? Visit http://www.firsthome.gov.au/ or call 1300 130 624 to find out eligibility requirements.
Before you hit the pavement, write a list of your requirements. You'll need to consider:
Now that you've worked out your finances and property requirements, it's time to start the search. The best way of sourcing suitable properties is through local newspapers and property internet sites. Other ideas to find properties include:
When you have located a property you would like to buy, ask the selling agent for a copy of the contract. The contract includes the title documents, drainage diagram, zoning certificate, council restrictions on the property, and items included or excluded from the sale. Your legal adviser (solicitor or conveyancer) should thoroughly check the contract to ensure everything's in order.
CONVEYANCING. Inexperienced buyers should seek professional help and advice on the conveyancing process. A conveyancer or solicitor is skilled at handling the paperwork associated with the property purchase.
You should then organise for building and pest inspections of the property.
With most contracts, it's up to the purchaser to check the building before signing. When you consider the amount of money that you'll pay for the property, a few hundred dollars spent obtaining professional building and pest inspections, ruling out any defects, is a small investment for piece of mind. Your inspection reports should cover:
Should the contract be approved and building inspections passed, you can now place an offer to buy. Before you do so, it's important for you to know the following.
Once you and the vendor have agreed on all issues, the agent will require you and the seller to sign the sale contracts. There are 2 copies, one for you and one for the seller. Only when you have both signed the contract, exchanged copies, and the deposit paid, do you both become bound by the contract. The deposit will likely be held in trust by the agent.
You are now committed to buying the property subject to the 'cooling-off period'.
As a buyer of residential property, in most cases you'll be granted a "cooling-off period". This period commences on the day of exchange and ends 5 business days later at 5pm. During this time, you can withdraw from the contract, however if you do so, you will forfeit 0.25 percent of the purchase price (taken from the deposit paid).
If you've not already conducted your pest and building inspections, you now have 5 days to do it!
It's vital that you have written confirmation of your loan approval before the expiration of the cooling-off period.
The period of time between the exchange of contracts and settlement is usually 6 weeks. Settlement day is a pre-arranged date when the exchange of contracts will be formalised. This is typical of what happens on settlement day:
Purchasing before you sell. This places you under pressure to sell your property within a given time. As a result you may end up accepting a lower offer than you would normally accept.