Buying process:

SO YOU WANT TO BUY A NEW HOME!

What do you do next?

(1) Find out how much you can spend on a new home by talking to

• your accountant
• your Bank Manager (and getting a pre-approved loan)
• any family members who may be able to help you with your deposit and/or a loan

(2) Once you have an idea of how much you can spend on a property, start looking!

• Go through the real estate sections of newspapers, magazines, booklets etc
• Attend Open Homes
• Drive through suburbs you would like to live in
• Take note of homes on the market in your chosen suburb

(3) When you've found a property you'd like to look through, contact the agent on the sign and arrange for an inspection. If you still haven't found a suitable property, contact several agents and leave your details with them in the event they find a suitable property for you. That way you'll get to know of listings before they hit the press.

(4) Inspect the property during the day. Look at it again in the evening/night, on sunny and rainy days, noting:

• Stairs and handrails are stable
• The condition of the walls and ceiling - eg water marks, mould, cracks
• Windows and doorways are square
• Floor boards are level and stable
• Wall paper and fresh paint aren't hiding cracks or warping
• The water pressure - turn on taps, flush the toilet, and check water flow
• Condition of fences round the property
• Large trees too near the house
• Condition of bricks and mortar outside the house
• Condition of roof (if you can see it) and gutters
• Any wood rot or termite mud trails

If in doubt, you can always arrange for a professional building and pest inspection to be carried out.

• Level of noise (traffic, neighbours etc) nearby
• Condition of neighbourhood - you can usually tell if most homes in the neighbourhood are rentals by the amount of parked cars around, and the condition of the yard!

(5) So you've decided this is the home you want to buy! Before you put in an offer, find out how the property is being sold:

• If it's a private treaty sale, there must be a list price on it
  
  
• If it's an Auction or Tender, there won't be a price on it - ask the agent if a provisional reserve price has been set, what offers are being sought and what has sold recently in the neighbourhood that is similar. Also ask whether offers would be considered prior to the Auction/Tender date.

Tell the agent you wish to put in a written offer on the property and have a decision made by the owners within (you can specify the time) hours/days. That's one way of finding out where you stand without having to live in limbo.

A word of warning - private treaty sales are usually listed at high prices that are negotiable, so don't put in your top offer! Put in an offer that's fair and reasonable but allows you room to move if your offer is not accepted. With some highly sought-after properties, however, you may only have just the one chance to put in an offer (you can find this out from the agent). In this case, give it your best shot as you may not get a second chance, especially if more than one offer is being presented to the owner at the same time. Incidentally, if an agent is presenting more than one offer, he/she has a moral and ethical duty not to disclose what one buyer's offer is to another buyer. The agent's job is to market the property and present all offers - it is the seller who makes the final decision.

GOOD LUCK on buying your most valued possession - your home!

So you've bought your new home - what happens next?

Once your offer has been accepted, and it has been counter signed/initialed and dated, it becomes a Contract. You will then have to organize Building Insurance on the property from 5pm on the first business day after the contract date.

Unless it's a cash and unconditional contract with no cooling off (in this case, the house is SOLD as soon as your offer is accepted!), chances are you will have to wait until the following conditions have been satisfied:

• Cooling Off period - 5 working days (from the date the buyer receives their copy of the contract)
• Building and/or Pest inspection - usually 7 days (or more) from the date of the contract
• Finance - usually 14 days (or more) from the date of the contract

There may also be other Special Conditions, like a Pool inspection or electrical/wiring inspection with time limits applicable. Only when these Special Conditions are satisfied can the contract be considered unconditional and the house SOLD.

Note:

• Be aware if you change your mind about buying the house during the 5 working day
  cooling off period, you will be up for a penalty of 0.25% of the purchase price
  
  
• If there is a (reasonable) problem during the Building and/or Pest inspection and the report is unsatisfactory to you, the buyer, you have 3 courses of action:

1. terminate the contract by notice to the seller before 5.00 pm on the Inspection date;
   
   
2. If the problem can be solved and/or you still want the house, have the seller to fix the problem before buying the house; or
   
   
3. re-negotiate the contract price so you can fix the problem yourself

In all the above instances, the seller has a right to ask for a copy of the Inspection reports. Any further negotiations are done through the solicitors (and the agent).

CONGRATULATIONS!
All you have to do now is wait for the settlement date before moving in!

PS: If you are uncertain about any of the above procedures, please feel free to contact Jan Elmore by phone, fax or email.

Phone: (07) 3272 2271
Mobile: 0400-567-340
Fax: (07) 3272 2278
Email: jan@elmorerealty.com.au