Preparing to Buy

Before You Start

Research! Make sure you spend some time going over other sales results for similar properties in the area. For instance, if you’re being asked for $700,000 for a freestanding home on 400sqm and a very similar place three doors down recently sold for $550,000, then it’s probably worth reconsidering your position.

Where do you find it? Not too long ago, every property was advertised in either the local newspaper or Saturday’s Sydney Morning Herald. That is no longer the case. Escalating advertising costs and changing technology means many properties are now advertised only on the internet. Property portals such as realestate.com.au and domain.com.au reflect most of what is on the market. They also have the facility for you to input your requirements and receive email alerts when a suitable property is listed. Try our Property Alert – you can register from the top right hand corner of this page.

Be clear on exactly what you want. It is unlikely you will get everything you want in a property so be clear on which requirements are negotiable and which are not. Buyers frequently end up purchasing something quite different to their initial demands, which is why agents will often suggest something that you may feel is not appropriate. It is not that we are not listening, just that something you may have said will have triggered the idea that a particular property will work for you. Make notes on the properties as you go through – if you are attending a lot of open inspections, you will start to forget which features belong to which property. Use the below checklist to make this process easier.

 

Property Checklist

Download Property Check List

 

Is this the one?

Keep it real! Okay, you have fallen head over heels in love with 10 Smith Street, Pleasantville. It’s got everything you want -three bedrooms, garage, pool, garden and a golf course nearby. Only problem is, it’s $50,000 over your budget. But if you stretch and scrape and beg … BE CAREFUL! While your heart is saying “whatever it takes”, don’t forget that eventually you will have to pay the piper. If you load up on credit and personal loans to get inthe door, you may be taking on an unmanageable financial burden. It won’t necessarily be obvious at first, but as time goes on, living on the financial edge will be extremely stressful. Take a deep breath and count to 10 before diving in too deep.

On the other hand … If everything checks out and the place is the one you’ve been looking for, don’t stubbornly refuse to negotiate if the vendor won’t come down a couple of thousand. If you can afford it without sending yourself into the debt abyss, shell out a little more to make sure you get the right house – such a small amount makes very little difference in the long run. For instance, an extra $5,000 over a 25-year loan is less than $40 per month.*

 

How’s your credit

How’s your credit? If you or your partner have a bad credit rating or big debts on credit you need to be up front about it. Your mortgage broker can advise you on obtaining a loan despite a bad credit rating, but don’t think you can hide it as lenders check you out thoroughly before approving your loan. Also make sure you consider the best mortgage product for you. There are plenty of choices available now, even loans that will provide you with 100% of the sale price, plus some, although you need to remember that there will be a requirement to pay mortgage insurance if you have less than 20% deposit. Make sure you consider the state of the economy and interest rates as well, as it may be appropriate to fix part of your loan – make sure you ask the question. But be sure to find out any potential penalties involved in case you need to sell during the time your loan is fixed