6 steps to buying a house
Purchasing residential real estate can be a very exciting process, however it can also be a confusing time for the prospective buyer. As you may already be aware, different agencies usually have different sets of rules and standards, so we would like to inform you of the general buying process.
Property owners receive all types of interest – some genuine, some not. Some people submit offers to test the possibility of sale, but do not actually stay true with their offer.
This can lead to frustration and concern for the owners as they try to assess who is actually a genuine buyer. The best way to present a strong offer on any property is to follow the steps below that allow you to understand what is required in preparation
Allowing you to put forward your strongest purchasing proposition to the agent. All offers must be presented to the owner in writing and all purchase details correct for filling in the contract for signing.
Step 1 – Provide agent with your full details such as:
- The actual purchase price you will be paying for the property.
- The method by which you choose to pay the deposit. eg. cheque/ bond/other.
- The settlement period that you require or the vendor has stipulated.
- The name of your chosen Solicitor or Conveyancer.
- The name of your bank or financial lending institution.
- Any special conditions or requests that you may have so that we can inform the vendor (property owner).
Step 2 – Confirm your time frame available to do any investigations
Find out if the property has a deadline on it, such as auction or other offers from interested parties.
Step 3 – Decide if you are going to obtain a pest & building report
Before you purchase any property – in particular a new home – it is important that you receive a copy of a Pest and Building Report from a qualified inspector. Please note that this report is a complete list of defects of the home, and is very different from the feature brochure that you receive from our agency.
Most people are shocked with the report they receive on the home, and most times misinterpret the report, e.g. the home is 34 years old and is in need of new roof tiles. Roof tiles last approximately 35 years and need replacing on every home of that age. The point to remember here is that all homes at one time or another require maintenance, and that this is known as a capital improvement.
Step 4 – Notify your bank of your purchase address & details
A pre-approval of finance from your bank or lending institution needs to be in place before safely proceeding with your property purchase, however many banks will approve you in principle yet may require a valuation.
Don’t be alarmed if your bank or lending institution request a valuation by a registered property valuer. This is normal practice of lending institutions, and serves as confirmation of the agreed sale price.
If you are intending to buy at auction, all the above-mentioned must be in place. Auction day is final. If you turn up to bid and you are the highest bidder past the reserve price (on-the-market price) you are the instant owner awaiting settlement of the property.
Step 5 – Don’t forget to include stamp duty funds in your final numbers
Step 6 – Meet with the agent and provide all details for sign off with the owner
Once agreement on price, settlement, conditions, etc has been reached with the vendor the sale can proceed. An exchange of contracts is the only way to actually buy or sell real estate. This is achieved by signing the contract of sale which is then processed by the agent with all legal parties.
Preparation is key. Understand the steps of sale and have everything in place is imperative to reaching your property goals. Whether you are considering purchasing this property or another in the near future and in need of advice, please feel free to contact your local Laing+Simmons team with questions that you may have.