Buying a House: Costs & Considerations

Buying House Guide

Buying a House: Costs & Considerations

When buying a house, there are several key things to keep in mind

Personal Requirements

You need to determine which amenities you and your family could not live without, and which would be an added bonus.
Make sure there’s enough living space and be sure to properly assess the location, as this can be just as important as the house itself.
Remember to factor in any necessary remodelling. You can even have a certified home inspector look at the property.
Consider the surroundings as a whole, but also don’t forget the little things.
If you need information, branch out beyond the normal avenues and have a chat with your potential neighbours. Ask them questions about the area to get an idea of what life would be like if you moved there.

Legal Requirements

Each state has a slightly different take on the home buying process that have developed through a combination of the state’s legal requirements and the practical process that has become the usual in that state.

Wherever you are, you may want to consider things such as:

  • obtaining an independent valuation;
  • reviewing disclosures made and considering any other information about the property you might like to know by doing searches;
  • checking with your banker or broker about how much you can borrow;
  • generally viewing the property and the area to see if it suits your needs;
  • and obtaining legal advice on the terms of any contract before you sign.

Sometimes you can make your contract subject to completing your investigations after you have signed, however it is important to understand what rights the contract may give you for adverse results.

Insurance over the property is another matter that may be overlooked. It is important that you seek independent legal advice so that you understand whether your contract requires you obtain insurance over the property even during the time before you become the owner.

See below the costs involved in buying a house and understanding private sales.

Costs of buying a house

What costs are involved in buying a house?
When buying a property, it’s important to seek professional independent financial and legal advice, as well as understand and consider all costs that will be involved

This includes:

  • Legal and conveyancing fees
  • Loan establishment fees
  • Government charges such as duty (formerly stamp duty) and GST
  • Building and pest inspection fees
  • Moving Costs

For more information on GST, visit the GST and Property section of the Australian Taxation Office (ATO) website.
It’s also important to consider ongoing costs of property ownership, which may include:

  • Insurance (building and contents) if applicable
  • Property rates and taxes.
  • Understanding Private Sales

How do private sales work?
In a private sale, the property is advertised and prospective buyers are invited to make offers. These buyers negotiate with the seller to agree on a sale price, usually with the assistance of an agent.

What is a ‘cooling-off’ period?

A cooling off period is the time at the start of a contract in which a buyer may be able to bring the contract to an end without other reason. There may be a relatively small penalty for terminating under the cooling off period. The period of time buyers have for this varies state to state as does the amount of the penalty that the seller can apply. Not all states have a cooling off period.

In some cases you may also be asked to waive the cooling off period, essentially giving up the right to a cooling off period. Be sure to speak with us about this before agreeing to it. The cooling off period is a valuable consumer protection provision, it is important that you clearly know the rights you do and don’t have in relation to it.

SOURCE: Buying a House, Costs & Considerations | Slater and Gordon

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