What is the process when buying a property?
Once you have found a suitable property, it can be a little daunting taking the next step to purchase the home you’ve fallen in love with. It may have been many years since you bought a property or you may even be a first home buyer. In either case, having a good understanding of what to expect when buying a property will help make the process as smooth and stress-free as possible.
Make an offer.
Generally as a buyer, you will make an offer on the property with the price you believe is fair and negotiate with the seller until both parties agree on a sale price. At this point you will also need to stipulate the terms of your offer, which will include the length of time you will need to have your finance approved, the time needed to carry out building and pest inspections, and also when you would like settlement to occur.
Negotiate the terms.
All of these time frames are negotiable and depending on the circumstances of the seller, shorter periods are often more favourable. An offer which specifies a shorter building and pest, and finance clause means the terms of the contract can be satisfied within a matter of weeks and the sale becomes unconditional.
Pay the deposit.
Once the sale price and terms of the offer have been agreed on and the contract has been signed by all parties, the property is now under contract. The deposit will need to be paid and you will need to satisfy the clauses of the contract within the specified time frames. Your nominated solicitor will handle the legalities of the contract.
Carry out building and pest inspections.
Engage a licensed building and pest inspector who is qualified to carry out a thorough inspection of the property. The latest infrared technology can be used to pick up termite damage within walls and moisture which is impossible to see from the outside. If a concern does arise, the buyer can negotiate with the seller to have the issue repaired prior to settlement.
Making your offer ‘subject to finance’ is a standard condition in property contracts. It allows time for you to organise a loan for the home you are purchasing and the bank will usually arrange for an independent property valuer to inspect the property. If your loan application is not approved, the finance clause allows you to end the contract and not go through with the sale.
Contract becomes unconditional.
Once all of the clauses of the contract have been satisfied, the sale of the property will go unconditional. An unconditional contract means the sale is binding and the parties are legally obliged to settle. Removalists can be booked and champagne can be popped as everyone celebrates the proceeding of the sale!
Attend a pre-settlement inspection.
A pre-settlement inspection is usually carried out by the purchaser in the week leading up to settlement. The aim is to ensure any special conditions have been met and that the property is in the same state as when the contract was signed.
Settlement occurs and keys are handed over.
On settlement day, your solicitor will advise the time in which the property is due to officially settle. When this occurs, the ownership will be exchanged, payment will be made and keys will be handed over. It is the most exciting day in your property purchasing journey where you can walk in to that beautiful home you fell in love with and know that it is finally yours!