The Ultimate Buyer’s Guide: What to Look for Before and When Buying a House in Australia

1. Define Your Property Goals Before Buying

Before you start attending open homes or scrolling through listings, it’s crucial to clarify your property goal, whether that is an investment property or your first home. Knowing exactly why you want to buy a property will guide every other decision you make. You and Me Personalised Property Services can help you decide on the first steps in your property journey.

Ask yourself before buying property:

• Am I buying to live in, rent out, renovate, flip, or keep it as an investment property?
• What kind of property am I after? (Apartment, townhouse, house, land?)
• What are my non-negotiables (location, number of bedrooms, yard, school zone, expected rental income)?
• Is this a long-term or short-term purchase?

Setting clear goals will help narrow your search and avoid time wasted on unsuitable properties.

2. Know Your Financial Position In The Property Market

Understanding your finances should be your foundation when buying a property and seeking finance approval, especially for an investment property. Start by assessing your current financial situation and borrowing power.

Steps to take regarding the purchase price:

• Get pre-approved by a lender to understand what you can afford
• Save a deposit, ideally 20% to avoid Lender’s Mortgage Insurance (LMI).

Factor in additional costs:

• Stamp duty (varies by state)
• Conveyancing and legal fees
• Building and pest inspections
• Bank fees and loan application charges
• Council rates and water rates (pro-rata)
• Home and contents insurance
• Interest rates for an investment property loan (if intended to be an investment property)

Also, explore if you qualify for government grants or schemes such as:

• First Home Owner Grant (FHOG)
• First Home Guarantee
• Stamp duty concessions for first-time buyers

3. Research the Property Market

The Australian property market is dynamic and varies significantly from suburb to suburb. Researching mortgage repayments, expected rental yield, property management fees and capital gains tax helps you make strategic decisions and avoid overpaying.

What to research in the property search:

• Suburb trends: median prices, rental yields, days on market, vacancy rates.
• Planned big infrastructure projects: future schools, transport upgrades, public transport, and shopping precincts.
• Demographics: crime rates, employment stats.
• Comparable sales (comps): always compare like-for-like recent sales from similar properties.

4. Choose the Right Support Team

Having the right professional team behind you can make or break your property purchase. You and Me Personalised Property Services can guide you in your journey to navigate buying a property or the property-buying process.

Key professionals to engage with for your property investment:

• Buyer’s Agent
• Mortgage Broker
• Conveyancer or Property Lawyer
• Building & Pest Inspector

Choosing experienced professionals with a strong local reputation can save you thousands and reduce stress regarding property expenses and seeking financial approval.

5. Inspect the Property Thoroughly

First impressions count, but you need to dig deeper to ensure a property is structurally sound and worth the investment. Assessing a property is more than just checking for natural light. It includes considering other factors, like inspections and maintenance costs. Building and pest inspections are essential to avoid costly mistakes in the future.

During a building inspection, consider aspects of the property value:

• Condition
• Layout and orientation
• Storage
• Fixtures and fittings
• Noise and neighbours
• Structural issues

Don’t skip professional building inspections, especially in older properties! Depending on the property type, you may also need to consider asking for a strata report. This is mainly for apartments that may have strata levies, and provides insight into any past or present issues with the property

6. Understand the Contract of Sale

When you find the right property, things can move quickly. Understanding the legal side of property conditions is essential. Research, money and loan options will also help you to complete this process.

Check for other potential ongoing costs including, but not limited to:

• Special conditions
• Inclusions/exclusions
• Deposit amount and settlement period
• Zoning restrictions
• Actioning any findings from the pre-purchase building inspection report

Have your solicitor or conveyancer review the contract thoroughly before you sign.

7. Finance and Final Approval

Once your offer is accepted, it’s time to finalise your mortgage. Submit the contract of sale to your lender.

Important finance tips:

• Avoid financial changes during this period.
• Ensure your deposit is accessible, insurance is sorted, and the conveyancer is ready.

8. Settlement and Ownership Transfer

Settlement is the final step when the property officially becomes yours. This happens after the contract is signed, final legal documents are completed, and the final payment is made.

What happens during settlement:

• Lender pays seller
• Conveyancer handles legal documents
• You receive the keys

9. Ongoing Ownership Considerations

Now it’s time to protect and maintain your investment. After settlement, it is vital to put in place appropriate insurance or property management, depending on the property’s intended use. This can help protect your home in case of emergencies, legal issues, or home maintenance.

After settlement, other amenities include:

• Insurance
• Utilities
• Maintenance
• Property management (if renting out as an investment property)

10. Common Mistakes to Avoid

• Skipping inspections – This could help avoid costs in the future (structurally and aesthetically)
• Buying based on emotion – This could lead to major financial issues based on the property
• Not researching comparable sales – Always do thorough research to confirm the value and scope of different areas
• Overlooking future costs – Budget accordingly to save any surprises in costs
• Not getting legal advice – Always get legal advice from experts to confirm any property contracts or information

Bonus Tips: Buying at Auction

Complete all due diligence before the auction and ensure you have thoroughly explored the property’s features.

• Have all inspections, finance, and legal reviews completed.
• Set a hard maximum budget and don’t let emotions take over.

Considering Buying In Australia?

Buying a property in Australia doesn’t have to be overwhelming. With the right preparation, research, and support, it can be a rewarding journey that sets you up for long-term success.
At You & Me Personalised Property Services, we encourage you to take your time, ask questions, and lean on professionals to guide you through the process. Contact us today to assist in the property process.