You’ve found the perfect property – what next?
Crunch the numbers
Whether you’re going to buy property via auction or private treaty, it’s important to have your finances sorted beforehand.
Knowing how much you can afford to spend is important, as it will help narrow down the property hunt and ensure you can afford the repayments on any home you do buy.
Sit down one weekend and work out what your incoming and outgoing payments are. Ask yourself how much you can afford to spend on mortgage repayments and how long it will take to repay the loan.
Having income protection insurance may provide peace of mind too, so you know your future – including your home – is secure.
Once you’ve done this, you’ll be able to seek conditional approval from your lender. This will show you are serious about buying, which is ideal when you wish to make offers.
Play it cool, but be reasonable
If you find your ideal home, let the agent know you’re interested. However, don’t be too eager at open inspections, as this might indicate to the vendor that you would be willing to pay more to secure the property.
Instead, play it cool, while clearly demonstrating your interest in the property. Make sure you carry out a thorough inspection and consider obtaining a valuation, too.
A valuation will help you work out what you might offer – but be prepared to negotiate! Remember that the asking price on the property is often higher than what the vendor would accept.
However, popular real estate in Sydney, Perth and Melbourne is attracting many potential buyers – so get in quick and make an offer that the vendors will actually consider.
Conditional or unconditional?
Depending on your current housing situation, you’ll either make a conditional or unconditional offer on a property.
As the name suggests, there are no conditions attached to an unconditional offer. Make sure you are financially able to make this offer, as once the vendor accepts this, you’re obliged to follow through.
Auction offers are unconditional. However, provided you’ve done your research this is a positive – you’ll appreciate the certainty of obtaining the perfect piece of real estate once the hammer comes down!
A conditional offer means certain conditions have to be fulfilled in order to form a binding contract. For instance, if you are already a homeowner, you might make an offer to buy a property that’s conditional on you selling your existing property.