A guide to buying your home

New to the home buying process? Our quick guide has all the information you need.

Do your own research

While the selling agent will answer a lot of your questions about a property, they are representing the seller, so it's always a good idea to do your own research, too. It will take a little time and money but is a worthwhile investment. The following documents are important sources of information:

The Contract of Sale
The title in the Contract of Sale
The 10.7 Certificate in the Contract of Sale
Pest and building inspection, if buying a house with land
A strata report, if buying a townhouse or apartment

The Contract of Sale

The contract holds a rich source of information on your proposed purchase. The front page of the Contract outlines important information on the property your are looking to buy. You will find a Lot number and either a Strata Plan or Deposited Plan number. Be sure that these numbers are the same as on the title and the 10.7 certificate.The Contract of Sale also outlines under which circumstance you are purchasing (Vacant possession or standing lease), what improvements have been effected to the land, what items from the property are included in the sale (think if I pick it up and shake it what stays is an inclusion) and what is excluded from the sale.

The Title

The title is included in the contract and should align with the lot and plan on the front page of the contract. You will also find here the names of the current owners, which should also match the front of the Contract. You will also find any mortgagees or people with an interest in the property. You may also find any easements or caveats on the property and in the case of a Strata Plan, any changes to by-laws along with the entitlements of each lot. If buying into a strata you will also find the strata plan and any development works that have been done to the property. You should also engage a solicitor to read the contract for you, but more on that later.

The 10.7 Certificate

Is a certificate issued by Council and shows what you can and can’t do with the property. Most are outlined in State Environmental Planning Policies or SEPP.

Pest and Building Inspection

You should get a qualified inspector to check out the build of the property. If it’s an older build they will highlight everything that they can find wrong with the building. It is normal for the report to become longer the older the build. The same inspector will organise a pest report for the property which outline any infestations or problems with the property caused by pests.

Strata Report

If buying into a Strata it is often worth establishing the nature of what you are buying into. Being an owner you are also a part of the Strata, so doing due diligence here can save time and effort later. A strata report can be organised by your solicitor.

Get Legal Advice

Buying a property is a big investment, and if things go wrong, it can be costly. A Contract of Sale is legally binding, and you should seek independent advice before you sign anything. Keep in mind that a solicitor or conveyancer should actively work in NSW to understand the applicable state laws.

How to find a property lawyer or conveyancer

Get recommendations from friends, family or work colleagues.
Contact the Law Society.
Contact the Australian Institute of Conveyancers NSW Division

Understand the process

Properties can be sold in several different ways, and practices can vary between agencies. Make sure you confirm with the salesperson how the process will work for the property you are interested in.

In every instance, it's a good idea to research the property to determine the price that you're prepared to pay and make sure that you get your lawyer or conveyancer to check anything that you sign.

Usually, property sales in New South Wales fall into three different categories.

By Negotiation or Private Treaty
Auction
Tender

By Negotiation or Private Treaty

This can be advertised in a number of ways, “Pre-Release”, “Sale by Negotiation”, or sale with a price band. By negotiation is a method of inviting buyers to make an offer without the seller disclosing what they will accept. If the seller decides to accept an offer the the buyer needs to pay a 0.25% deposit, sign a contract of sale and some other documents (an authority for RE/MAX to exchange contracts and an authority to accept a deposit by instalments) and the property goes into a 5 working day “cooling off period”. During this time you can perform any reports you wish and your bank may also want to do a valuation. Work closely with the selling agent as they can make the process simpler and easier that solicitors swapping emails. If you decide not to continue with the purchase you will loose your 0.25% deposit. Once the cooling off period has expired you are required to pay a balance of deposit up to 10% of the purchase price. The remaining funds are paid on the settlement date, usually 42 days from date of signing the contract.

Auction

An auction is an open process where buyers bid against one another to purchase a property. When buying at an auction, you are bidding unconditionally so you must have all your finance and research arranged beforehand. The seller will set a reserve price, and if bidding exceeds the reserve price during the auction, the property will be sold immediately to the highest bidder. If bidding fails to meet the reserve, the highest bidder may be invited to negotiate with the seller after the auction. Sometimes the seller may accept a pre-auction offer.

Tender

When a property is sold by tender, it is not marketed with a price (although a minimum guideline price may be advertised). Buyers make confidential offers to the selling agent by a set date, and then the seller has a pre-defined period when the tender closes. They can then decide which offer, if any, to accept.If you make an offer on a tender, you will often need to pay a deposit at the same time, which is refunded if your tender is unsuccessful. Once the seller chooses an offer, the remainder of the process is the same as a negotiated sale.

READ AND UNDERSTAND THE CONTRACT OF SALE

The contract of sale is a legal document, so it’s vital to read it carefully. It contains the terms and conditions of the property sale, such as:

The price
Details of the buyer’s deposit
Any chattels included (like carpets and ovens)
The property title (i.e. Torrens Title or Strata Title)
Any conditions specified by the buyer or seller
Settlement dates

It also contains clauses that outline the buyer’s and seller’s obligations and outlines what kind of penalties will apply if either party defaults on the agreement terms (e.g., delaying settlement). You cannot change your mind once you have signed the agreement and all conditions have been met – you are legally committed to the purchase.

WORKING WITH THE REAL ESTATE AGENT

Remember, the agent selling the house is working for the seller. You can choose which agent you want to deal with from the selling agency, and it does not have to be the one who has listed the property.

Make sure that the agent you’re working with is licensed so that if anything goes wrong, you can call on the support of Fair Trading NSW. They publish a list of all licensed agents at "Check a Property License",which contains details of any complaints upheld against an agent.

Remember to ask the selling agent any questions you want to know about the property. They are required by their rules of conduct, the Property & Stock Agents Act 2002 and Regulations to deal fairly and honestly with all parties and are not allowed to withhold any information that might affect the sale. Any statements they make to you must be able to be backed up with evidence. They must also notify you in writing if they have any conflicts of interest. Now that you know how the process works, check out our latest listings to find your next home

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	33 Smith Street
	02 8838 5600
	xtra@remax.com.au

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