Living in Australia is a dream come true. The country has so much to offer, from its beautiful beaches to its amazing wildlife to its friendly people. However, it can be difficult to find your way around when you first arrive here. This article will help you understand how property purchasing works in Australia. You must know what steps are involved before deciding where to buy or sell your home.
Steps involved when buying a property in Australia
1. Gather your professional associates
Conveyancer: A person who helps with legal matters such as real estate transactions. They may also assist clients by preparing contracts and other documents related to purchasing a new house.
Mortgage Provider: When you land the best mortgage provider, they will provide you pre-approvals on properties that match your criteria. You then have time to look at these houses until you decide whether or not you want them. If you choose one of those homes, you need to ensure that you get all the necessary approvals prior to signing anything.
Accountant: Buying international properties requires an accountant because they need to prepare tax returns on behalf of buyers. Accountants often work together with conveyancers.
Buyer’s Agent: Many investors choose to hire an agent to represent them during the sale of their properties. Agents often work closely with buyers and sellers to ensure smooth negotiations between both parties.
2. Get pre-approved for loans
When you apply for a loan, lenders usually ask for proof of income. To qualify for a bank loan, you must show that you earn enough money each month to cover the costs associated with owning a home. Banks use this information to determine if you can afford the monthly payments. Once you receive approval, you can begin looking for properties to purchase.
3. Apply for government assistance
If you plan on using private funds to pay for part of your down payment, you should consider applying for financial aid through the Australian Government. There are many programs available to help low-income earners save up for a deposit. These include grants, interest-free loans, and even rent subsidies.
4. Find properties to buy
Once you have received pre-approval for a loan, you can start searching for properties online. Most websites allow users to search for specific properties based on location, price range, size, etc. Some sites even let you narrow down your searches by features like the number of bedrooms, bathrooms, garage space, etc.
5. Start negotiating
Negotiation is key when selling or buying a property. Both sides need to agree upon terms regarding the final cost of the transaction. For example, if you are trying to sell your home but don’t think you can reach a fair deal, you might try asking for more than what you originally wanted. On the flip side, if you plan to buy a particular property, you could lower your expectations slightly. Remember that negotiation isn’t always easy; sometimes, things just aren’t meant to go smoothly.
6. End the Formal Loan Approval
After reaching an agreement on the terms of the contract, it’s important to sign off on the formal loan application. This means that you officially accept the offer from the lender. After doing so, you can move forward with making arrangements for closing. The buyer needs to send his/her own copy of the signed contract back to the seller along with any additional documentation required by the lender. At this point, the seller has no choice but to close the sale.
7. Make the Down Payment
The next step involves paying the full amount due on the property. Depending on how much equity you have saved up, you may be able to put some cash into escrow instead of having to borrow against future earnings. However, most people prefer to take out a personal loan rather than putting extra cash into escrow. It makes sense since banks charge higher rates of interest compared to credit unions and building societies.
8. Finalize important arrangements
At this stage, both parties will make sure all necessary paperwork is completed before moving ahead with settlement. You will want to ensure everything is ready for inspection prior to signing anything official. If there are issues with the title, they will likely require an amendment which requires further negotiations between the two parties.
9. Settlement
Settlement occurs once the last piece of paper is signed. During this time, the buyers transfer ownership of their house keys to the sellers. They also hand over the money needed to complete the purchase. Once these steps are done, the new owners become responsible for maintaining the property until the end of the lease term.
Property purchasing costs
When you buy property, you pay several fees upfront. These include legal fees, surveyor fees, stamp duty, conveyancing fees, land tax, mortgage broker fees, bank charges, solicitor fees, valuation fees, etc. In addition, you must factor in maintenance expenses such as water bills, electricity bills, insurance premiums, repairs, cleaning services, gardening, lawn care, pest control, pool service, etc. All of these factors add up quickly.
