7 Steps in Buying a Home

Purchasing a house in Australia is most likely one of the most expensive things you will ever do, so you want to get it right.

By John Christian – April 7, 2022
person handing over keys to home

Purchasing a house in Australia is most likely one of the most expensive things you will ever do, so you want to get it right. You might not be paying for the whole value of the property at once, but buying a home is still a significant expense and one that will need to be repaid over time (plus interest). While the process might seem complicated and confusing at first, you will soon see that there are clear steps to follow.

The process of buying a home

When you’re getting ready to purchase a property, understanding the property purchasing process is key. To make it easier for you to understand, we have listed 7 things to know before buying a house in Australia.

1. Outline Your Budget

Getting a good idea of your budget is the first thing you will want to do before you go any further. It will help you to determine what price range you should be looking at and what you can afford to buy. To determine your budget, you will need to look at your finances and consider what future expenses you might be paying for.

There are a few things you’ll need to ask when calculating your budget. Such as “how much can I afford each month on mortgage payments?” “How big does my house deposit need to be?” and “How much will lenders be willing to let me borrow?” With a quick Google search, you can find borrowing calculators online that can help you determine how much you might be able to borrow based on your income and current and future expenses.

2. Getting a Mortgage

Securing a mortgage involves several steps, but the first is looking for some good deals and getting a home loan guarantee certificate or pre-approval certificate. This means that, once you have found the home you want to buy, you will be able to borrow from the lender since you have already met the required conditions.

Pre-approvals will also make you feel more confident when you get to the make and offer phase as you’ll have a more precise number in mind. Loan approvals will last for around six months, or sometimes longer, so don’t apply if you’re not ready to buy just yet.

You can use a mortgage broker to help you find the right mortgage or apply directly to the lender. Remember to shop around for different loan types and mortgage rates as this can significantly impact how much your repayments will be.

3. Find Your Home

Once you’ve secured pre-approval on a mortgage, you can now set out to find the perfect home. There are various online property portals that can help you to browse listings and filter your search. You can also go directly to real estate agents or use other methods, such as using a buyer’s agent. You can then start attending open homes and property inspections of homes you might be interested in buying.

4. Make an Offer

When you’ve decided that a property is the right one for you, making an offer is a next step. You might do this through a private sale or you might be bidding on a property at auction. If it’s a private sale, you’ll have to decide how much you want to offer. At an auction, you won’t have to do this, but you should set a maximum price that you’re willing to pay.

It’s also a good idea to do your research on other property sales in the area, both recently sold properties and those currently on the market as this will give you a good indication of how much to offer.

If your offer is accepted, the real estate agent will draw up the necessary paperwork and deliver the contract signed by the buyer to the seller who will decide if they want to accept your offer. It is usually at this point in the buying a home journey that you engage the services of a conveyancing solicitor.

5. Property Inspection

Once you’ve found a property that you think you want to buy, carrying out an inspection of the property will help you make sure it is a sound investment. It’s always important to be aware of any potential issues with the property, as it will ultimately affect your decision to proceed with the property sale or help you negotiate the price. Building and pest inspections are vital and will highlight any issues or potential problems in the home you’re buying. Thankfully most residential contracts include this as a condition of purchase, so if any issues are raised, you have the right to terminate the sale without losing your deposit.

6. Conveyancing

All of the legal work that needs to be completed when you purchase a property can seem a little confusing for a first-time buyer. However, the conveyancing process doesn’t need to be difficult when you have a reliable conveyancing team by your side. Conveyancing involves carrying out searches to find out things like who owns the property and if anyone else has an interest in it, and transferring the property title to you as the new owner.

A conveyancing solicitor will also help you prepare and lodge the necessary documents to transfer legal ownership of a property’s title from one person to another. They will complete the transfer form, and property information form and assess whether any exemptions from stamp duty apply to your specific circumstances in buying a home.

While there are options available for DIY conveyancing, it’s much better to have it taken care of professionally by a conveyancing solicitor as they can ensure that all the correct paperwork is finalised and that absolutely nothing has been missed.

couple buying a home taking photo with keys

7. Settling on Your Home

When settlement day arrives, the property title is transferred into your name. If you’ve taken out a mortgage, it will also take effect from this day. The contract of sale will define the settlement period and your conveyancing solicitor will handle finalising the settlement. They will calculate any adjustments relating to the property which will need to be fairly split between the buyer and seller and organise the balance of the purchase price to be paid to the seller. When this is all finished, you’ll get the keys to your new home.

Follow these 7 steps in buying a home to understand the basics of the process. You can always get help from professionals too, including mortgage brokers, conveyancers, and real estate agents.

Article by John Christian, Principal Lawyer, Founder and Director of Victor Legal

John has extensive experience in complex civil and commercial dispute resolution and litigation matters, specialising in:

Building and construction disputes
Complex litigation
Contract drafting and review
Dispute Resolution
Commercial Law
Corporate insolvency
Securities and caveats
Debt collection
Contract disputes
Commercial and risk mitigation advice

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