Purchasing a residential property is one of the most strategic steps towards wealth creation a person can take in their lifetime, according to First National Real Estate Chief Executive, Mr Ray Ellis.
“This means you should take every precaution possible to ensure the property you are buying is in good condition before you sign the contract of sale,” Mr Ellis said.
“Many buyers feel overwhelmed by the time, effort and research that needs to be put into performing due diligence. However, due diligence should be your best friend, not your homework, as it allows you to gain an in-depth view of the property you’re buying.”
Attending an open inspection is the first vital step in determining whether a home is the right fit. While many would consider this obvious, a great many purchases are made without an inspection taking place, particularly by Australians buying investment properties overseas.
“Before signing the contract of sale, you need to purchase a professional building and pest inspection report to make sure the property is structurally and internally sound. If you’re purchasing overseas, try to arrange for somebody you trust to inspect the home and location to confirm its suitability.” said Mr Ellis.
“Imagine if you spent thousands of dollars on a home only to find it will require thousands more to fix termite damaged floors. A professional inspection can help you to identify any problems a home might have before you buy it and save you from this situation occurring”.
It’s important to also establish that the property you’re buying is appropriately priced. In some cases, it’s prudent to obtain a professional valuation, especially if circumstances make it difficult to establish a reasonable expectation. An independent valuation can inform you of the potential resale value of the property, as well as rental return, should you choose to turn the property into rental accommodation in the future.
According to Mr Ellis, another essential part of due diligence is to ensure you have the necessary funds to complete the purchase.
“Will you be able to pay the deposit for the home at the time you sign the contract of sale? Can you pay the balance of the property price by the time settlement date rolls around?”
“It’s a good idea to get your finance pre-approved, in writing, before you begin searching for a home. Not only can this help to make the home buying process a lot less stressful, it can also give you greater confidence during negotiations” said Mr Ellis.
Issued by: First National Real Estate
For further information contact: Stewart Bunn, National Communications Manager, First National Real Estate, on 0413 624 317