Buying a home can be a daunting experience and is often made harder with the real estate jargon that is thrown about.
Here are some of the “Buzz” words that you should be aware of :-
Appraisal : This is prepared by a real estate agent and used as a guide to pricing a property for sale and rent. Not to be confused with a Valuation (which is completed by a licensed valuer).
Body Corporate : Now known as Owners Corporation. This group is responsible for managing the common property (shared driveways, carparks, lifts, corridors, gardens) of strata titled properties eg. units, townhouses and apartments.
Buyers Advocate : A real estate professional who assists purchasers to locate the right property for them at the lowest price. Buyers Advocates are becoming more popular, (thanks to ‘The Block’) as they can take the stress out of an emotional purchase.
On the market : When the property being sold has reached the vendor’s reserve price at Auction, the property will be sold to the highest bidder.
Off market : When a property is for sale, but not officially or publicity listed or advertised. Purchases are usually completed via Buyers Advocates or purchasers directly.
FIRST TIME BUYER TIPS
FOMO (fear of missing out) trap : Auctions are very competitive. The last thing you want is to exceed your budget, through fear of missing out. Stick to your finance limit, needs and want list.
Pre Approval Offer : Many people think that obtaining a Pre-Approval for a home loan secures the loan. This is incorrect. Pre-approvals only assess your desirability as a borrower based on your income, financial history and ability to make loan payments. The amount is only an estimate and is not a done deal.
Market Influences : This refers to pricing increases and lack or slowing of real estate stock. Over the last 18 to 24 months, property sales have been a vendor’s windfall. Higher price tag s came about due to a lack of supply. The more properties that come onto the market, the more choices the buyer will have with price variation.
BEWARE OF ADDITIONAL EXPENSES
There are many costs that you will need to factor into your budget when purchasing a property. Here is a list of some additional costs:
Lenders mortgage insurance (LMI) : If the loan is above 80% of the property value, some lenders require LMI subject to the policy of the day.
Your legal fees
Disbursements for purchase : This could include adjustments for water, owner’s corporation fees, search fees, council rates etc
Building and pest reports Removalists costs Building Insurance
Property Contracts : In a rapidly moving real estate market it is tempting to overlook or cut corners when reviewing a contract and not all purchasers are familiar with what’s actually in a contract.
Beware of being caught up in a possible “bidding war” to secure the property : It is paramount that you engage the services of a Solicitor or Conveyancer to carefully peruse the contract prior to placing an “Offer” or signing. Perhaps you may need to see if your legal representative will accept a financial retainer for reviewing any property contracts that you’re investigating to ensure the right property is secured. Most will be pleased to assist in this regard.
Employ an old adage, Caveat Emptor – “Let the buyer beware”
Contact Paul today on 0417 567 747 to discuss any current or future commercial finance requirements you may be considering.