FINANCE
Obtain preliminary approval for finance
Before you commence your search for property, you should shop around for your finance. It is in your interest to obtain a preliminary approval for finance. This document will confirm what amount you are able to borrow and also if there are any restrictions on your purchase. Once this approval is received you can start your property search knowing if you see a property of interest you will know if it is within your price range and be able to act quickly to secure it!
Some lenders will have restrictions on lending for apartments and houses and it is important to be aware of this before commencing your search for property.
PRIVATE TREATY SALE
Attain a contract for sale for a property you are interested in purchasing
Once you have found a property you are interested in purchasing you should ask the selling real estate agent for a copy of the contract for sale. If you have not already found a solicitor or conveyance you should at this point find one. We would recommend a solicitor that specializes within the area.
Making an offer
If you are interested at the asking price you can make an offer. The selling agent is obliged to present this to the seller.
You should be ready to sign the contract as soon as possible once a sale price has been accepted by both parties. Make sure your finances are in order. Lengthy negotiations and waiting for finance approval create the opportunity for another keen buyer to offer the vendor more or provide a quicker exchange of contracts.
Exchange of contracts
The contract sets out the terms and conditions of the sale. It will also identify any items to be included in the sale (e.g. curtains, air conditioning, light fittings etc). Your solicitor will examine the contract carefully and if purchasing an apartment will conduct a strata search. This search will examine the financials and any issues relating to the building.
There are two copies of the sale contract – one for the buyer and one for the seller. Each party signs one copy before they are swapped or ‘exchanged’. At this point the deposit (usually 10%) is also paid. Once this process takes place you are bound by the terms of the contract.
Settlement
Settlement occurs when the balance of the purchase price is paid to the seller. The standard contract has a settlement period of 42 days (from date of exchange of contracts). This can be altered if agreed by both parties and is usually done prior to exchange of contracts.
AUCTION
- Obtain a copy of the contract and get advice from your solicitor or conveyance.
- If you are interested in the property, let the agent know. You may consider making an offer before the auction. As with a private treaty sale an agent is obliged to present all offers to the seller.
- Contact your finance provider well in advance of the auction to make sure you have finance available if your bid is successful.
- For all auctions of residential property in NSW you are required to register with the selling agent prior to the auction or on the day itself. You must provide proof of identity on auction day.
- A card or document issued by government or a financial institution showing your name and address is needed as proof of identification.
- All bidders must display their registration number when making a bid. The agent cannot accept a bid from a bidder who is not registered.
- If you are bidding, make clear and confident bids. Waiting until the last moment may not be a good idea as you could miss out.
- Remember to take your cheque book! If you are the successful bidder you will be required to pay a deposit (usually 10% unless otherwise agreed) when you sign the contract following the fall of the hammer.
FIRST HOME BUYERS
There are currently great concessions for all first home buyers. All first home purchasers under $500,000 are stamp duty exempt, and a scaled rate between $500,000 and $600,000. First home purchasers will also receive a $7,000 from the NSW Government. One of the stipulations of the grant is the value of the property must not exceed $750,000 in order to be eligible.
There are no income or assets test to qualify for the benefit. This information is subject to change and we recommend you visit the Office of State Revenue free call 1300 130 624 or visit their website www.osr.nsw.gov.au for further information.
FINDING THE RIGHT PROPERTY
Do your research! Attend open house inspections, view listings (both for sale and sold) on www.realestate.com.au and www.domain.com.au and go to auctions. As agents that specialise in this area we are more than happy to provide advice, even if just a second opinion on a particular property, location etc.
