Buying Information

Are you looking to purchase a property? Consider these key points before making your decision.

 

THE WISH LIST

It is important to determine the features you are looking for in a property. You are more likely to make the right choice if you know what you want and are informed about your options.

Make a list of what you must have in a property so you are not tempted to buy a property that looks fantastic, but doesn’t meet your needs. It is important to analyse what you want based on needs and wants. Needs are things you cannot live without, wants are desirable items but you can install them yourself or can live without them.

The more information you can supply, the easier it is for Brooke Stone to show you promising properties. 

 

THE TOTAL COST

Buying a property is a big decision and a large financial commitment. It is important for buyers to spend some time working out what they need and what they can afford.

Purchasing a property is not just the cost of the property. The buyer should factor in the additional purchase costs such as:

  • Legal fees
  • Loan establishment fees
  • Government charges (stamp duty)
  • Property inspection fees (termite inspection, building inspection)
  • Settlement fees
  • Moving costs and set-up costs
  • Insurance

You should also allow for contingencies such as interest rate increases, problems that may arise in the property that need attention, rates and body corporate fees. Do you want to make improvements or buy new furnishings for your new home?

 

FINANCE

It is important to contact your bank or a mortgage broker to find you a loan that will suit your needs. It is a good idea to find out how much you can borrow before you start looking for a house. 

It is easier for the broker to compare terms and conditions of various finance institutions and advise the result of their comparisons.

Brooke Stone suggests using a good finance broker to help you obtain the best loan suited to you. The best part is that it costs nothing for a qualified broker. If you would like the names of some good, experienced brokers, ask Brooke Stone Real Estate.

Arrange with your lending provider for a letter of “pre-approved finance”. This will make your real estate transactions easier and the best way to ensure that you won’t be disappointed if you find later that you cannot get finance.

 

SEARCH FOR A PROPERTY

There are many ways to find what homes are listed for sale. 

The internet is one of the best ways to see what is on the market in your desired location. The website www.realestate.com.au has up to 95% of the properties listed for sale. You can search by entering the number of bedrooms you want and the price range in which you wish to search.

Other sources to find properties for sale are: Newspapers (The West, Sunday Times), local papers, Real Estate WA magazine, Real Estate Agents window displays, ‘For Sale’ signs and through friends, family and neighbours.

If you are confused by any of the common terms in property advertisements, speak to the Brooke Stone Real Estate Sales department.

One of the first things to do is look at house prices in your preferred area. If prices are higher than you can afford you may need to lower your expectations or look in another suburb – a neighbouring suburb may be a little cheaper and close to the area you desire.

Many purchasers make the mistake of buying on emotion rather than make valued, factual decisions. Things to consider is resale value (one day you may want to move to a bigger or better property). Cosmetic items can create an emotional response – either positive or negative and may enhance a good floor plan or make the buyer overlook a good floor plan that could be easily changed to improve for a few dollars. Analyse the potential from a logical and professional point of view.

 

BUYERS’ AGENT

A Buyer’s Agent are licensed real estate agents who work exclusively to help people buy property. A Buyers’ Agent will take the necessary steps to help you find and purchase real estate. The Buyers’ Agent will research property that suits your needs, liaise and negotiate with other agents for you, bid at auctions on your behalf, arrange building and pest inspections, conveyancing and even finance and removalists – whatever your require.

If you are looking for a new home or an investment property but don’t have the time to devote to it, or aren’t confident about buying real estate, consider appointing Brooke Stone as your Buyers’ Agent.

A Buyer’s Agent can be cheaper than you may think as these professionals can often negotiate a purchase price lower than the fee to appoint them.

 

QUALIFYING THE PROPERTY

Searching for property on offer will soon lead to inspecting other prospective properties. Make sure you make notes so you can compare.

  • Score the property out of ten.
  • Record your first impressions
  • Perform a do-it- yourself building inspection or arrange a professional building inspection
  • Draw a sketch of the property and if possible take a photo.
  • Record your final analysis of the property.

If you like the property and wish for more information make sure you check;

  • Review the vendors’ statement, copy of the title certification showing the boundary measurements, easements and/or covenants, planning information.
  • Outgoings – water rates, council rates, body corporate fees.
  • Is the property connected to the sewer? Are there any septic tanks on the property that are not decommissioned?
  • What is the total cost to purchase the property? (All fees, stamp duty, etc)
  • Building restrictions
  • Building permits or information for any work completed in the last 7 years.
  • Any agreements the vendor has entered into with others in relation to the property. eg fencing
  • If unsure you can engage a solicitor to review the documents.

It is in the Selling Agent and Vendors best interests to provide the accurate information in this statement. If they do not, the purchaser may be able to get out of the contract or sue the vendor.

 

DO-IT-YOURSELF INSPECTION

It is imperative that you carefully inspect the house you are considering purchasing so you know the exact condition of the property. This way you won’t end up with costly repairs after you take possession of the property.

Internal

  • Check floors are level and there are no gaps between the floor and the skirting boards.
  • Look for signs of dampness which include: rotting carpet, damp walls, mould, musty odours, bubbling peeling paint around wet areas
  • Check the walls and ceiling for major cracks and problems. (Small cracks in the wall and around the cornice are normal – this is called “settling cracks”). If unsure arrange a building inspection.
  • Check the walls are straight – not bowing under heavy weight. Check the ceiling is not sagging.
  • Are all the plumbing, electrical and gas appliances working? Check them and if something does not work, make the contract conditional upon the Seller fixing these items.
  • Check windows and doors open with ease. If there are security windows, make sure the owner has all the keys.
  • Is the home monitored by an alarm? Ask for the details.
  • Make sure all lights work. Check all power points work – either plug in a small light or purchase an inexpensive power point tester from a hardware store.
  • Test the water pressure of the taps – turn on several taps at one time and see if the pressure is greatly affected.
  • Put in a plug and partially fill up the sink and bath and check the drainage. Water should drain quickly. If the water does not easily drain it could indicate blocked or damaged pipes.
  • If the property is furnished, lift rugs, move furniture, check under beds etc to ensure there are no hidden damages or surprises under the furnishings.
  • Check the hot water and try the reticulation.
  • Find out when you can move in. Is there a tenancy on the property?

External

  • Inspect fences and gates to ensure they are stable, secure and there is no rot.
  • Check large trees near the house. Large root systems can cause structural damage if they are close to the home.
  • Check that the drainage and water runoff is away from the home.
  • Inspect the outside walls. Are they straight, cracked, rotten? Is the mortar in good condition? If it is crumbling or missing, it may need some structural repairs.
  • Check the eaves. Water staining may indicate damage gutters or full gutters. These need to be cleaned regularly of debris.
  • Look at the roof. Is it straight? Are there any cracked or damaged tiles? This could cause leakage and water damage.
  • Check stumps, foundations of the property etc. Is there any rot, termite invasion or damage.
  • If any evidence of rot or termite or anything else which you are not certain, it may ve opportune to employ the professional services of a building and/or termite inspector.

 

WRITING THE OFFER TO PURCHASE

The ‘Offer and Acceptance’ is much more complicated that simply working out how much you want to pay and then signing the document. With huge dollar amounts involved both you and the seller want to make sure you are protected if things were to go wrong. For this reasons built in contingencies need to be written into the document.

Contingencies

  • Finance – who will provide your finance, how much, when does finance need to be approved?
  • Deposit – how much are you going to pay as a deposit.
  • Are you going to have termite inspections, building inspections etc and the timetables when these are to be performed, who pays, what if the results are unsatisfactory?
  • Personal property included in the purchase. Are all the curtains remaining? Is the dishwasher included? Is the shed attached or are they taking it with them? What about the water features?
  • Are there any repairs to be conducted? When do these need to be completed?
  • When will you take physical possession? Do tenants need to vacate? Do you want to take possession prior to settlement?
  • Are you selling your home and need the property to sell prior to purchase?

What price do you offer?

Learn as much about the market and aspects of the property before you put in an offer.

Compare similar properties on the market and ones that have been recently sold. Things to compare include number and size of bedrooms, number of bathrooms, property size, land size, additional features. You can find details of sold properties on www.realestate.com.au, speaking with agents and attending auctions.

Questions to consider 

Do you make your best price upfront or do you want to start at a lower price and be prepared to negotiate up? It is important to note that if the seller receives multiple offers they may decide to accept another offer without giving you the opportunity to increase yours.

Don’t hurry – there is a lot of money at stake and you will spend years paying off a mortgage. Make sure you make the decision that is right for you.

Read all documents before you sign anything. If you don’t understand something you can consult with a solicitor before signing. Make sure anything that has been verbally agreed is also written into the contract.

 

CHOOSING A SETTLEMENT AGENT

You are allowed to do your own settlement but there is a lot involved in the process. It is illegal for a friend to do the settlement for you.

Settlement Agents are licensed, have indemnity insurance and have their trust accounts audited annually. These are all there to safeguard your interests.

Settlements Agents or Conveyancers are listed in the Yellow Pages, can be recommended by a friend or you can ask the Brooke Stone to recommend a conveyance or settlement agent.

There are fees involved during the settlement process. Talk to Brooke Stone to give you an estimate on costs.

The Settlement Agent will conduct all of the searches and enquiries needed to make sure everyone has fulfilled their obligation. 

It is important to ensure you sign all documents provided by the settlement agent promptly. It is your responsibility to ensure you have signed your mortgage documents and returned to the bank. Delays in settlement may attract a penalty interest. Make sure you read all your documentation and if you have any questions, ask your settlement agent.

 

AFTER THE SALE

When the contract price and conditions have been agreed the Purchaser has a number of responsibilities.

  • Deposit – the deposit needs to be made by the date in the contract
  • The buyer needs to contact their bank to arrange finance. The bank will need a copy of the ‘Offer and Acceptance’ document.
  • The buyer needs to arrange for any pest or building inspections (at their expense) within the time frame specified in the contract. Settlement Agents and the Agent need to be advised of any problems or confirmation that the inspections were ok – a certificate may be required.
  • Insurance – the purchaser should arrange insurance for the building and contents to start when the purchaser takes possession of the property. Moving insurance is also a good idea.
  • Pre-settlement inspection – the purchasers can go through the property a week before settlement is due to make sure all electrical items are in good working order and the property is in the same condition as it was when it was sold.

 

Settlement occurs when all conditions are met and the bank and settlement agents have arranged for the documentation and details to be transferred. At this time the balance of the purchase price is transferred to the seller in exchange for the title of the property. A copy of the title with the new owners name will be received in the mail a few weeks after settlement of the property.