Australia’s real estate market is seeing a lot of activity from various buyers. Whether you’re a first time buyer looking to obtain your first slice of real estate or an existing homeowner eager to upgrade, make sure you understand the purchasing process.
“In an encouraging forward sign for new home building, the number and value of loans for both construction and new dwelling purchase headed higher in May 2014,” noted Harley Dale, Housing Industry Association Chief Economist.
From completing a home loan comparison and securing finance to making an offer and counting down to settlement day, the process is full of important steps. Make sure you don’t miss anything – and always ask for advice if you’re unsure.
Choose a lender
In some ways, you can compare buying a house to running a marathon. If you don’t plan adequately, you might get off to an okay start, but you’ll trip up further down the road.
Before you get swept away with the magic of open inspections, complete a home loan comparison, pick a lender and secure loan pre-approval. Not only does this give you peace of mind, vendors will see you as a serious buyer when you make an offer.
Make an offer
That brings us to the next step – making an offer!
Whether you bid at auction or negotiate in a private sale, making an offer can be an experience full of equal parts excitement and nerves. A buyer advocate can help negotiate on your behalf, but you may feel confident tackling this task yourself.
If your offer is accepted by the vendor, you’ll need to sign a contract of sale and pay a deposit (usually around 10 percent of the purchase price). But before you put your name on the dotted line, be sure to get a professional to check the fine print.
Contact a conveyancer
This step is all about dotting the Is and crossing the Ts. A conveyancer or property solicitor will go through the contract of sale with a fine tooth comb, looking out for any unusual or unfavourable terms.
If you’re concerned about putting your heart, soul (and financial future!) into a property, you could opt for a conditional agreement. This means you’ll sign the contract of sale, which will become binding on a stipulated term being fulfilled.
It’s common for a sale of contract to be conditional on building and pest inspections coming back with the golden seal of approval. This way you’re protected if it turns out a property’s built on crumbling foundations or otherwise.
Complete building inspections
Right – you’ve signed a contract, your legal representative is completing a title search and your lender has signed off your mortgage.
However, don’t forget about the property itself! You don’t want to rely on your credit cards to pay for expensive repairs and maintenance costs if you’ve bought a lemon. This is the time to obtain inspection reports for your potential new home.
Get ready to settle
Leading up to settlement day, the balance of the purchase price will be transferred to the vendor and your conveyancer or solicitor will transfer the certificate of title.
On settlement day, you’ll get the keys to your new home. Don’t forget the final touches, such as furniture or white goods for your new home.