- Posted 04 Mar
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When investing in a property, it’s important to undertake due diligence to ensure you are making the right decision. It may seem a little overwhelming at first, but every first-time buyer faces the same questions and concerns.
The last thing you want to do is to rush into something without having done the proper research. It can seem like a lot of work, but when you are talking about such a large investment, you don’t want to take any chances and make the wrong decisions.
Step 1: Legals
Find a solicitor or conveyance company that specialises in property transactions to help you. Getting assistance from professionals will make the process a lot easier and ensure you are making the right decisions by helping you understand the fine print.
Step 2: Structural Integrity
If you’ve found a property you should always look into its structural integrity first. This can be a huge problem for first-time buyers who think they are getting a good deal out of their property, only to find they have to spend thousands to rectify structural problems with the roof, floor or walls.
Be extra vigilant when buying older homes and always obtain a building inspection. An architect or registered builder should perform these; always check their credentials too.
Step 3: Council
Ensure that you can actually use the property for your intended use. This can be done by speaking to the town-planning department at your local Council, or by checking the zoning certificate.
This is particularly important if you plan to renovate or add on to the existing property.
Step 4: Titles
Get a statement from the vendor, indicating vital technical information about the property and its immediate surroundings. This should include a copy of the title of the building and any additional property such as car spaces. This statement will clearly outline exactly what you are getting from your purchase.
Step 5: Surroundings
Find out if there are any works being planned on adjoining properties. This should be included in the vendor’s statement and could have a big impact on you.
It may affect how you can use your property, your enjoyment of it and even your property value. Any potential builds could be a nightmare for you and your family and have an effect on your day-to-day life.
Step 6: Utilities
Inspect the vendor’s statement for any documents from utility providers that include the presence of easement on your land. This is a portion of land that you legally own, but to which utility providers are given access to perform repairs.
If you have any easements over your land then this could affect if you can build on it and how you use your land.
Step 7: Funding
Finally, you need to ensure that you have the necessary funds to meet your part of the settlement by the agreed date. Legally, the vendor can keep your deposit if you do not meet the obligations of your contract. To make matters worse, they can sue you if they are forced to re-sell the property for a lower amount and you could end up having to pay them the difference.
It may sound like a lot of work to undertake due diligence before buying your property, but it can make a huge difference in the long run.
There is no point trying to rush into something that requires such a large investment and you will be happy you have done the appropriate research.
Let the team at Australian Credit and Finance help by ensuring you have pre-approval for a loan and the right insurance. Call us today.