For the uninitiated, buying a new home can seem like an intimidating process filled with contracts, negotiations, legal forms, financial documentation and legal jargon–a minefield to traverse.
Whilst all of these aspects are involved in the process of purchasing a house, it can be comforting to know that many of these complexities are handled by either:
A conveyancing lawyer
The selling agent
To simplify the process for those considering taking the plunge and purchasing or building a new home, let’s take a look at the buying process from the purchaser’s point of view.
How much can you afford?
Speak to your lender first.
Clarifying how much you have to spend will save you the heartache of falling in love with something beyond your reach. With Government rebates and concessions especially around house and land packages making home buying more affordable, it pays to do your research.
Your lender will be able to guide you through the process of applying for Government grants and supply you with a list of documentation they will require from you, such as:
Current outstanding financial commitments
Make a wish list
Working with your budget, create a list of ‘non-negotiables’ that you need in the property you are seeking to purchase. This will shorten and simplify the process of house hunting.
When buying a house and land package, view as many Display Homes as possible and ASK QUESTIONS. Identify what is included and have the consultant clarify what is upgraded on the Display Home.
Do your research. Whether building a new home or buying an established one, inspect as many homes as possible. Identify which floor plan works best for your lifestyle and circumstances. Ask yourself a few questions such as:
What is the neighborhood like?
Is the property close to public transport and solid infrastructure?
What shopping options are there?
Where are medical facilities and hospitals located?
What are the noise levels of traffic like both during the day and at night?
Once you have identified a prospective property, enlist the services of a professional conveyancer. They will review the Section 32 (supplied to you by the selling agent) to ensure the property is sold with no encumbrances. It also verifies the existence and location of covenants and boundaries related to the property.
Making an offer
Once you have fixed on a property within your price range, it is time to make a formal offer. The selling agent will write up the offer and take a deposit–usually ten percent of the selling price but this can be negotiated.
Conveyancing and settlement
When the agreed settlement date has arrived, your bank and conveyancer will work in unison to transfer the funds and confirm with you that the transaction has occurred. The property is now yours.
The scenario for purchasing at auction is different to the offer and acceptance used in a traditional sale. When buying at auction, you must have your bank finance approved and in place and the required deposit available to transfer on auction day, should your bid prove successful. Settlement will then occur as per the date stated on the day of the auction.
House and land packages
The procedure for building a home through a builder is different again. The process will involve staged payments over the course of the build.
Once your finance is approved your lender will review the contractual terms laid out by the builder and payments will be staggered as each stage of the process is completed. A final payment will be made once the house is ready to be handed over to you.
As with many things in life, purchasing a property can be a daunting prospect. Surrounding yourself with trusted advisors and experienced friends will assist in make the process a far less stressful process.