Whether off-the-plan or existing, whether a house or apartment, consider these 8 steps to ensure a smooth settlement when buying a property:
- Loan Preparation – Arrange your loan documentation with your bank including maximum conditional pre-approval before looking for a property. At exchange you will need to provide at least 10% of the deposit price to the Vendor.
- Property Hunting – Consider the type of property and price range you wish to buy to determine whether you may be entitled to a little help from the Government with some stamp duty or tax concessions. As a First Home Buyer you may be eligible to a stamp duty exemption for any property below $750,000. As an off-the-plan Purchaser, you may also be eligible for a $5,000 stamp duty concession.
- Pre-Exchange Due Diligence – We can assist in arranging all pre-exchange searches including all pest and building reports, surveys, due diligence and physical inspections. We will review your Contract prior to auction/purchase and liaise with the Vendor for amendments in your interests.
- Exchanging Contracts – We will meet with you in and assist you with signing the Contract. We will then exchange contracts with the Vendor and contracts will become binding after 5 days on all parties unless a cooling off period of 5 days has been waived or the property was purchased at auction. It will be generally a 6 week period until settlement takes place.
- Post Exchange Steps – Following exchange, we will correspond with the Vendor’s Solicitor regarding any queries or questions that they may have. We will also provide you with all the steps you need to take until settlement including arranging your insurances, stamp duty payments, unconditional loan approval, final inspections and getting you ready for settlement day. We will look after all of your required statutory searches to ensure the Vendor has complied with all statutory requirements by law and paid all water/council/strata rates up to the day of your settlement.
- Getting Ready for Settlement – We will book settlement for you and liaise with your bank regarding your finance and all you need to do is undertake a final inspection of the property a couple of days before settlement to make sure it is all ready for you to move in. At settlement you will need to pay the remainder of the funds off to the Vendor and must have all of your approvals and money ready.
- Settling Your Purchase – We will attend settlement on your behalf and complete the documents for the bank to have the property registered in your name. Following settlement you will be able to collect your keys from your agent.
- Post Settlement Checks – At the end of the process, we will notify all authorities to update your details on their registers and we will provide you with all of the documents for your safekeeping as well as maintaining them on our files.
Be sure to update your estate planning such as your wills as you have a new addition to your property portfolio!
Important points to keep in mind:
- When buying apartments, you need to look at the by-laws and a strata report which will help you determine whether there is a healthy and friendly operation of the building.
- When buying off the plan, as the process generally takes a couple of years, you need to consider that the market may change considerably and interest rates and property prices are likely to fluctuate from when you purchase until you settle.
- Choose the type of ownership you want to own it under if you are purchasing with a spouse or friend as this can go against your wishes under a Will.
- Think about fluctuating interest rates, upfront costs, First Home Owner Savings Accounts and budgeting for your lifestyle when buying a property. Also consider your inspection costs, conveyancing costs, stamp duty costs, set up costs and changes to interest rates in your budget to buy a property.
- Liaise with your accountant if you are buying a property for investment purposes, as there could be significant tax benefits for you.
If you are planning to buy a property, be sure you contact a member of our Property Law Team. We are here to help.