Buying a property doesn’t have to be a daunting process. We’ve outlined the steps involved below and our agent will work with you every step of the way.
Find the right property
Consider all the features you’d like in a property and start searching. If you’ve found some properties you’re interested in, get in touch with the agent to arrange an inspection, or attend a scheduled open home event. Don’t hesitate to ask questions!
Your property search may be guided by your budget. If you need to borrow money in order to purchase the property, search online for a “borrowing power calculator” to see how much you can afford to borrow, or take it a step further and get peace of mind by speaking to a mortgage broker about pre-approval for a loan. Be aware that you will need a deposit from your own money (typically 5-20% of the property value, depending on the loan product) as the bank won’t loan you 100% of the property value.
Make an offer
After you’ve found a suitable property, make an offer to start formalising the process. The agent will liaise between yourself and the seller to determine if the seller is willing to accept the offer, or to negotiate further.
Offer accepted
If your offer has been accepted, you’ll be sent the contract of sale, which will be signed by yourself (the buyer), and the seller.
At this point, if you haven’t done so already, it is recommended that you engage a conveyancing solicitor who will help you through the legal processes.
You may opt to agree to the sale on the condition that certain criteria is met. Typically, for the sale of a house, one such condition would be a building and pest inspection, i.e. the sale would be “subject to building and pest inspection”. If this you are indicating that you’d like the sale to be “subject to building and pest inspection” then you will need to arrange to have a building and pest inspection carried out before the settlement date.
If you haven’t yet obtained finance (i.e. you haven’t yet received approval for a home loan, or you haven’t got the funds to meet the sale price yet), then you may also wish to make the sale “subject to finance”. You would need to ensure you have arranged finance prior to the settlement date as well. Speak to a mortgage broker about a home loan if you haven’t already done this.
Settlement date is set. This is typically 30 days after the contract date to allow for any conditions to be met (e.g. obtaining finance, getting the building and pest inspections done, time allowance for previous occupants to move out, etc), but may be shortened if necessary.
You pay the initial part of the deposit into our trust account, which is typically $1000, within 48 hours of signing the contract. The remainder of the deposit gets paid later, when the contract becomes “unconditional” (see below for details). The trust account is the account we use for holding money that is not ours, i.e. the deposit is being held on behalf of the seller. Trust accounts have limited access and are subject to regular independent audits, ensuring this money is kept secure.
Awaiting settlement
There is typically a 5-day cooling-off period on a contract of sale, which commences once both parties (buyer and seller) have signed the contract. You may wish to waive or shorten the cooling-off period if you wish. During the cooling-off period, you are able to cancel the contract if you change your mind.
As noted above, you may have built conditions into the contract, for example:
- the contract is subject to you obtaining finance (e.g. 7 to 21 days to allow time for your bank to approve a loan)
- the contract is subject to a building and pest inspection (usually with a period of time by which that inspection should be completed, e.g. 7 days after contract signing)
- the contract is subject to the sale of another property (e.g. if you need to sell your old property in order to finance this new property)
If there are conditions built into the contract like this, then the contract is considered “conditional”. Once those conditions have either been met or waived, the contract is then considered “unconditional” and therefore binding by both parties (i.e. the buyer is legally bound to proceed with the purchase, and the seller can no longer cancel the sale unless there is a breach of the contract).
Settlement date
By this time settlement date is reached, you should have secured finance for purchasing the property, a building and pest inspection should have been carried out (if applicable), and any other searches you asked your conveyancing solicitor to perform would have also been completed.
If there is nothing preventing the purchase from going ahead, your conveyancing solicitor will ensure payment from you (or your bank) goes through to the seller. Conveyancing solicitors typically use PEXA to facilitate this payment. Note that PEXA may charge a fee (https://www.pexa.com.au/) for this service, which the conveyancing solicitor usually passes on to you. Speak with your conveyancing solicitor if you’re unsure.
Keys will be handed over to you at your earliest convenience. Congratulations!