Australians enjoy a very strong real estate market that is protected by strict regulations and guidelines. When buying or selling a home, people tend to follow the rules laid out for them, making sure everything goes as smoothly as possible.
As with any large industry, there are some who spoil it for the rest! There have been instances of fraudulent activity where sellers or buyers are cheated out of their money, nor do most feel safe due to potential scams.
In this article we will go over how the Australian property market works and some tips to help you be a savvy seller or buyer.
The process of selling a home
After you have listed your house with a real estate agent, the next stage is to find someone who wants to buy it. This can be done by going door-to-door or using online tools to search for potential buyers.
If you are looking to sell quickly, then you should consider listing with a broker instead of an individual agent. A broker works for a specific group of agents, which makes it easier to source suitable candidates.
Brokers also take care of the legal paperwork for the sale, as well as negotiating the sales contract on your behalf. While this may sound daunting at first, we’re here to help!
We’ve created a section containing helpful tips and tricks for buying or investing in property that includes how to pick an agent, what documents to look out for and how to negotiate like a pro.
“Thinking about buying a house means diving into lots of different things – so don’t feel overwhelmed,” says Sam.
How to choose your real estate agent
Finding an excellent real estate agent is not easy, but it is possible! There are some important things to look for when searching for your new home or investment property. Your agent should be able to provide you with a high level of service that goes beyond just buying a house.
They will be there during the negotiation process, helping you find your dream home and then negotiating on your behalf until you close. They will also help you manage the other commitments you have (work, kids, life) while still giving you their full attention.
Their loyalty to you can mean staying up past bedtime to finish negotiations on a sale, or being supportive through others’ questions about the market and the area.
As with any professional, do your research and ask around for recommendations. You want to work with someone you trust who delivers what they say they will.
Getting a mortgage
Finding a home to purchase is not easy, even for experienced real estate agents. It can take months or even years before you find that perfect property!
Most people begin looking for their dream house by going to open houses or viewing properties online. Both of these are great strategies to do while looking for your new home.
These are usually free unless there is an entry fee or the owners ask for one. You will have to pay attention to all the features of the house, talk to other members of the community who live near the house, and if possible, visit the house alone without someone with you.
Viewing Properties Online
Many real estate companies offer a service where you can list and view some of their listings for free. This way you don’t need to go through the cost of buying a house sight unseen. These services also help promote the house for the seller.
Fees associated with a mortgage
A lot of people assume that real estate agents take a commission when they refer you to a lender or broker, but this is not always the case. Some fees are simply for service providers who offer their services to lenders and brokers to help them go through the process more quickly. These include fees for brokering loans, legal documents, and credit reports.
Some lenders and brokers pay these service providers directly, so there is little need for an agent to get involved. This can sometimes cause confusion as to what their role should be. Agents may feel like they are doing a good job helping your business find a home, only to have them leave it up to others.
Agents are usually paid either a percentage off the loan amount or a set fee per person referred. The former is typically lower than the latter, so if agents’ jobs do not seem quite fair, look into whether the loan size makes a difference in how much they earn.
One of the biggest expenses that buyers will have is conducting an inspection. This is when you check all parts of the property for any potential issues or things to learn about it.
Inspections can be conducted at different times, depending on what part of the house people are inspecting. For example, someone looking to rent out a room may not need an extensive inspection as they will likely look through the rooms frequently.
For others, like those who want to buy a home quickly, their search may focus more heavily on an inspection. They may ask questions about how well connected utilities are (such as water, electricity and internet) and if there are signs of moisture or damage around the house.
These types of inspections could cost anywhere from $100–$1,000 according to what item people are checking out. Some areas checked include the roof, gutters, chimney, windows, doors, surrounding yards and basements.
There are also professionals that can do professional level inspections, which usually run slightly higher than normal ones. These can easily cost over $1,500!
So now that we’ve gone into detail about some costs associated with buying a home, let us talk about timing!
Timing an inspection
Most real estate agents will recommend doing your own inspection one week before going under contract. The reason for this is so that anyone else involved can relax and prepare for the sale while you inspect everything yourself.
Making an offer
When you’ve found your dream home, it’s time to make an offer! A good real estate agent will be able to help you determine the best way to present your offer depending on what type of seller you’re talking to (hard or soft sellers) as well as whether they’re under contract with their current house owner.
A general rule is that if the seller has already accepted an offer from another buyer, then they’ll probably accept yours too!
Some tips when offering for sale: Make sure your offer is realistic. Don’t expect the house to drop down in price after you’ve made an offer – this doesn’t happen very often.
In most cases, the seller will get more than one chance to sell their house so waiting to see if it drops in price before putting in an offer can save you money!
Also remember that while it’s tempting to want to rush into negotiations and have them completed ASAP, doing so could cost you money in the long run. The longer the property sits empty, the less likely it is to find its ideal new owner.
Finding the right property
The next step in owning a home is finding your dream house. This can be tricky as most people have a set budget for buying a house, which usually excludes paying expensive fees to find one that fits you.
There are several ways to go about finding your new home. You could search real estate websites such as REIWA’s own website or Domain name Realty where you can create an account free to access their listing database.
You could also visit many different agents who represent various properties around their area of expertise. Some will even call sellers direct for you if they believe it would help them sell theirs!
By being familiar with the market, potential buyers make comparisons more easily so this is a great way to identify what homes meet your expectations. An agent should always advertise how well they work within your budget so you know before you buy whether this person will help you achieve your goal.
Getting a deal in place
When you are ready to buy or sell a house, your agent will work with you to get it done. Agents have their own personal sales strategies and tactics that they use to close deals. Some agents do not like talking about themselves or the process so it is important to be aware of this.
It’s very common for agents to put off putting in effort to find a home until the last day before the sale. This can backfire because most people look forward to looking around homes so they don’t want to make an appointment to see an empty house!
Agents will also hold multiple showings of a property without telling you. They may even put in some extra time to check out a house on their own first before bringing you in as a buyer.
This happens more than you would think and it is totally unethical. It is illegal to act in this way in many states. If you notice such behavior happening, report them immediately.