At BlueRock, we understand what it’s taken to get that deposit and we want the purchase process to be rewarding.
Like a lot of things in life, some basic prep will give you the competitive edge, calm nerves and confidence to enjoy the experience. So here are seven things you should be on top of when buying your first home.
1. Making informed decisions prior to offer
It’s easy to let emotions get the better of you when you find “the one”. Before you get swept up in the moment, make a commitment to getting your legal representative to review any Contract of Sale before you make an offer. Independent advice will allow you to negotiate the contract terms and conditions and secure not just your home, but a deal you’ll be proud of after the honeymoon period is over.
2. Loan Approval
Understand that pre -loan approval is like an engagement - you have the ring but there’s still room to back out before you get down the aisle. The bank will most likely approve your loan but it’s under no legal obligation to do so.
We don’t want you to end up alone at the altar if the bank decides to do a runner. Always sign the Contract of Sale ‘subject to finance’, even if you have pre-loan approval. You’ll be able to terminate the contract and recover your deposit if the bank changes its mind or values your property lower than the purchase price (spare a thought for Hughesy, who paid paid $3.067 million for the Block house only to discover the bank valued it at much less).
Like a wedding planner, a broker might help take some of the pressure off by obtaining different valuations for the same property and increasing your chances of borrowing the required amount.
3. Stamp Duty Exemptions and Concessions
Home ownership is expensive, so make sure you squeeze every possible cent out of First Homeowner Grants, Exemptions, Concessions and Reductions. You’ve been paying tax for years, so BlueRock wants you to get a good return on your investment.
To take advantage of all possible savings, we’ll advise you on the type of property and price range you should consider when searching for your first home.
4. Principal Place of Residence
Who knew you could get a discount simply for living in the house you’ve purchased?
A Principal Place of Residence concession is a stamp duty reduction available when the purchase price is $550,000 or less. The only catch? You must live in the house for at least a year and move in within 12 months of the settlement date.
5. Additional Fees
We all know we should be reading the fine print but how many of us actually do it?
At BlueRock, we understand that you’re so caught up in the purchase price that all those additional fees can get overlooked. We advise you in the beginning so you can budget accordingly.
You wouldn’t be the first person to have forgotten:
- Stamp duty – land transfer duty calculated on the price of the property
- Professional fees – charged by the lawyer/conveyancer for their service
- Lodgement fees – fees charged by the Land Titles Office for transferring the property into the Purchaser's name
- Adjustments – rates, taxes and outgoings that need to be adjusted for to ensure that the Vendor only pays for the portion up to the Settlement Date
- PEXA fees – a one off fee of $114.07 to settle the matter electronically
6. Property and Pest Inspection Reports
When looking for a home, it’s easy to make decisions with your heart and not your head. No one wants to be starring in the sequel to The Money Pit.
We don’t want your dream home to turn into a nightmare, so obtain a Property and Pest Inspection report prior to purchasing the property. The experts will be open and honest, and you won’t find yourself on A Current Affair as termites reduce your home to rubble.
7. Building and Planning Permits
With so many DIY renovating shows gracing our screens, is it any wonder so many people think that all you need is some basic skills and a trip to Bunnings to tackle any home reno?
Hopefully all the works on your property have been left up to the experts, but just in case, the Vendor will need to supply the following:
1. Relevant planning and/or building permits
2. Defects report
3. Building insurance
Councils can order for illegal works to be rectified or demolished - unless you’re a competitor on The Block, that sounds costly and stressful.
We understand that purchasing your first home is one of the biggest financial decisions you’ll make so don’t just blunder your way through. You wouldn’t run a marathon, have a baby or take on a new job without doing some groundwork. We’re here to provide legal and financial support every step of the way to make your Great Australian Dream a reality!