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When buying a property, most people will deal with a real estate agent, a bank or mortgage broker, and a lawyer or conveyancer. Our experience is that most buyers deal with the real estate agent first - who negotiates the price of the property, but not any other terms of the sale, and arranges the preparation of the Contract of Sale. By the time the buyer seeks our advice there is no real opportunity to negotiate any other terms (which may well be needed if there are other issues with the property - for example, illegal building works on the property). If there is scope to renegotiate the terms of the contract, this can be both time consuming and emotionally draining.
For buyers, we recommend that the above order changes. By adopting the following order, as a buyer you will better informed and better able to negotiate the terms of the contract of sale (and not just the price).
1. Get legal advice first
Understand what your obligations will be under the terms of a standard LIV/REIV (for Victoria) or Law Society of NSW/REINSW (for New South Wales) Contract of Sale.
Know what should, and should not, be included in the terms of the contract of sale for your benefit. What you negotiate with the vendor's real estate agent should not be limited to the price that you pay for the property.
2. Get your finances in order.
Talk to your bank or mortgage broker so that you know how much you can borrow, and how much of your own money you will need to contribute.
How will you pay the deposit? Do you have the cash, or will you need a deposit bond?
3. Conduct your due diligence on the property before making an offer
Due diligence might include (but is not necessarily limited to) checking that:
a. the property boundary measurements match those on the title;
b. the property (including structures) complies with the relevant planning scheme and any Planning Permits affecting the property;
c. all buildings and structures have necessary building permits, occupancy permits, and consents;
d. any pool and/or spa is registered with the local council, that the pool or spa safety barrier is compliant;
e. any requisite owner-builder insurance or builder warranty insurance is in place; and
f. any soil and/or groundwater contamination is disclosed by the vendor.
We can give more information and advice in these respects.
Consumer Affairs Victoria has more information on its website at https://www.consumer.vic.gov.au/duediligencechecklist
4. Remember that the real estate agent is working for the vendor.
Unless you have engaged a real estate agent as your buyer's advocate, the real estate agent is working for the vendor.
Contract Us to make an appointment to discuss your proposed real estate purchase before entering negotiations with the vendor's real estate agent.