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Buying a home is one of the biggest financial decisions you make. It’s important you understand your rights, take your time making decisions and read everything before you sign.
Here is the general information and resources to help you with the buying process.
Organising your finances
Your lender will tell you how much you can borrow based on your income, assets and expenses. But you must decide if it’s affordable. Remember to plan for future commitments or changes in circumstances.
If you're borrowing a percentage of a property's value, keep in mind that the price you offer might not match what the lender thinks the property is worth.
Make sure you have funds available for the deposit before you sign a contract to buy.
See the government incentives available to first-home buyers.
Finance tools
- check repayment amounts for different interest rates and work out how much you can borrow with the Moneysmart mortgage calculator or HomeStart mortgage calculator
- calculate transfer fees and charges.
Finding and researching properties
Think about what you need and what you would like in a home. Consider:
- if you need to be close to schools, public transport, shops, parks or recreation centres
- any businesses nearby that might be noisy or create a lot of traffic
- whether you need a unit, apartment or house
- how many bedrooms you need
- how your needs may change over time
- yard size – low or high-maintenance gardens, and outdoor living areas
- whether you want an older or newer house
- the cost and time for any renovations needed.
Work out if you can afford a home in the areas you’ve chosen by checking real estate websites, recent sales and auction results.
When looking for properties, you could:
- observe auctions without bidding
- go to open inspections for different properties.
Looking into the market early, even before you're ready to buy, can help you stay realistic and less emotionally attached when you find a property you like.
Inspecting a property
When you find a property that you’re interested in, make sure you inspect it thoroughly. You can check some things yourself, but others should be assessed by a professional.
Read more about inspecting a property.
Form 1 – vendor’s statement
A Form 1 statement is a legal document. It provides information about things such as the property’s title, mortgages on the property, easements and zoning.
It does not include information about:
- encroachments onto neighbouring properties
- the condition of buildings – unless a housing improvement notice or other notice has been given due to the house being unsuitable for habitation
- whether buildings comply with regulations – unless a notice has been issued regarding fire safety requirements or requirements to remove or perform work if a building is non-compliant with a development approval
- if measurements on the title are accurate.
It’s your responsibility to find out about anything not covered in the statement. Your solicitor or conveyancer can help you.
The Form 1 is signed by the vendor and must be factually accurate and complete. It must be available to prospective buyers before the auction or 10 clear days before the settlement of a regular sale. As a purchaser, it is preferable to seek the Form 1 before you sign any contract to purchase a property.
Read more about easements.
Viewing the Form 1
If the property is to be auctioned, the agent must tell you where and when you can view the Form 1.
The Form 1 must also be available at the:
- auctioneer’s office or the vendor’s agent, at least 3 consecutive business days before the auction
- auction site, at least 30 minutes before the auction is due to start.
Potential bidders should consider if they will have enough time at the auction to view the Form 1 given the number of other people who may be present.
When a property is not sold via auction, the Form 1 must be provided at least 10 clear days before the settlement date. However, the Form 1 is often provided much earlier.
Some agents will make the Form 1 available for inspection to potential buyers, and most agents provide the Form 1 to the buyer soon after the contract is signed. This is because the contract doesn’t become legally binding until the cooling-off period has expired.
Check the title
Conveyancers and solicitors who deal with property transfers can access land title documentation and advise you how the title will affect your ownership. Land title documentation will also show registered restrictions or encumbrances on the land. It’s also important to check with the vendor or their agent for full details of any unregistered dealings that might affect you.
Learn more about land and property titles.
Boundaries
You can ask for a document called a deposited plan to see the property’s boundaries the date it was registered.
If you have any suspicions or concerns about boundaries as a potential purchaser, consider seeking a survey report before signing a contract (or make the contract conditional on obtaining a satisfactory survey report).
Only a licensed surveyor can properly verify the correct boundaries and exact location of fences and buildings.
Encumbrances
An encumbrance is a document that usually contains restrictions on the future use or development of the land. These restrictions can be significant and can reduce the value of a property.
Make sure you read and understand any encumbrance before you sign the contract.
Buying a property
Most property sellers (also called vendors) hire an agent or other expert to manage the sales process, although some people choose to sell a property themselves.
Real estate agents can provide helpful information to potential buyers, but remember they are working for the vendor, not you as a buyer.
Agents will usually:
- take your details and tell you about properties you might be interested in buying
- answer any questions about listed properties
- arrange inspections
- pass on your offer to the seller
- organise for the contract to be signed.
Learn about making an offer, buying off the plan, rent-to-buy schemes and cooling-off rights at offers, auctions and buying off the plan.
Holding deposit
The agent can ask you for a deposit ($100 maximum) when you make an offer. This holding deposit will be given back to you if the offer is not accepted. However, if you sign a contract and then ‘cool off’ within the cooling-off period, the vendor can keep your holding deposit.
In many cases you get a cooling-off period of 2 clear business days to reconsider the purchase.
The deposit must be paid once the cooling-off period has expired. This money is held in trust until settlement. Find out more about deposits (on this page).
Chattels are moveable items and belong to the vendor, rather than the property. Generally, all movable items such as personal effects, furniture and garden ornaments are excluded from the sale, unless specified.
If you want to buy any chattel, ask for the item to be noted in the contract.
Fixtures are items that are attached to the property, for example by bolts or strong glue. If the vendor wants to take a fixture, include a condition in the contract that the vendor repairs any damage caused by removal of the item and that the affected surface is restored – such as matching paint applied.
If tenants currently live in the property, the lease period and details must be recorded in the Form 1.
Depending on the rental agreement, you may be able to seek vacant possession as a condition of sale, but you must record the condition in the contract.
Find out more about residential tenancies.
Once you’ve signed a contract
Insurance
Contracts usually state that risks relating to the property fall to the purchaser from the date of the contract. It’s important to have your own building insurance in place for the property from the date of signing the contact.
If you have finance for the property, the lender will usually require you to update the insurance policy, so they are listed as an interested party. They will likely require a ‘certificate of currency’ for the insurance, that you can get from your provider.
Insurance for strata or community lots is different because building insurance is in the name of the strata or community corporation.
Deposits
If you bought by private sale, you may have paid a holding deposit. A further deposit is paid when the cooling-off period ends.
Be cautious of paying a big deposit if the vendor isn’t using an agent. By law, the agent must pay the deposit into a trust account.
Purchases by instalments are prohibited and you can only be required to make up to 3 payments by way of deposit.
Buying property with another person
If you are buying with another person, you must decide how to hold the land. There are 2 options:
- As a ‘joint tenant’, where each person owns the property jointly and one title contains the names of all owners. If one of them dies, the property automatically passes to the other(s).
- ‘Tenants in common’, where each party holds a set share of the whole property. Tenants in common can sell their share or leave it to someone in their will.
Seek professional advice from a solicitor or conveyancer if you are unsure about these forms of ownership.
Recently built or renovated
If you're considering buying a house that was built or renovated within the last 5 years, it’s recommended you seek specific advice on what warranties and potential remedies may be available to you.
Find out more about warranties and building, extending and renovating a home (PDF 8MB).
Also check if any building indemnity insurance is in place. This insurance is required for all new builds and many renovation projects to protect the property owner and any future owners if the builder dies, disappears or becomes bankrupt in the 5 years after the work was completed. Details of the building indemnity insurance should be disclosed in the vendor’s statement.
Settlement
Settlement is usually 4 to 12 weeks after contracts are signed but can be negotiated between you and the vendor.
Learn more about settlement.
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Related information
Other websites
Helpful contacts – buying and selling a home - Consumer and Business Services
