FAQs - Buying a Property

Q. When should I make an offer?
A. You should commence negotiations once you have decided that you would like to purchase the property.

Q. How much deposit do I need to buy a property?
A. 10% of the purchase price is the standard deposit required. If you don’t have this amount readily available, we may be able to negotiate a 5% deposit, or deposit bond, on your behalf.

Q. What is a deposit bond?
A. A deposit bond is an alternative to paying cash upon exchange of contracts. A deposit bond can issued by authorities and are underwritten by an insurance company. For example, Deposit Power and some financial institutions may provide one to you for a fee.

Q. Will paying a small amount of money often referred to as a “holding” deposit secure the property?
A. No, a legally binding agreement does not take place until exchange of contracts.

Q. What does “exchange of contracts” mean?
A. There are two identical copies of the contract. The vendor signs the original contract and the purchaser signs the other copy. The contracts are then checked carefully page by page to ensure that they are identical. Once identical the contracts are then dated. The agreed deposit is then paid. The contract for sale is a legally binding agreement at this point.

Q. Do I need property inspections before contracts exchange?
A. Yes as there will be no chance to pull out of the purchase once contracts exchange. Pest, building and strata inspections are recommended prior to exchange of contracts, so you will have as much information as possible about the property. Once contracts have exchanged, subject to any cooling off rights, both parties are committed to the provisions of the contract for sale.

Q. What is a cooling off period?
A. 5 business days in which you are entitled to exercise your rights to cool off. Most vendors will ask you to waive the cooling off period as they do not wish to have a conditional contract and this can be arranged by providing a 66W certificate.

Q. What is a section 66W certificate?
A. A licensed conveyancer will explain the implications of waiving the cooling off period and if you agree then a section 66W certificate will be provided. There will be no cooling off period if a section 66W certificate is provided on exchange of contracts.

Q. Is there a cooling off period if I buy at auction?
A. No. Contracts will be legally binding at the fall of the hammer. Your licensed conveyancer should thoroughly review the contract and arrange any property inspections prior to you attending the auction which is why all searches are conducted and the contract is reviewed prior to attending and bidding at the auction.

Q. Should I get unconditional finance before I exchange contracts?
A. Yes. Once contracts exchange you will be bound to complete whether or not you can obtain finance. A conditional approval, often referred to as pre approval, will be subject to assessment of your personal financial situation. The mortgage provider may also require that a registered valuer provide a satisfactory valuation of the property. An unconditional loan approval will be provided once the mortgage provider is satisfied that you meet their criteria for a home loan and the valuation of the property is satisfactory. Your mortgage broker will be able to assist you in obtaining unconditional loan approval.

Q. What do I have to do once contracts have exchanged?
A. You will need to arrange to have your mortgage documentation and, if you are a first home buyer, First Home Owners Grant application forms signed and returned to the bank in readiness for settlement.

Q. What are property enquiries and why are they done?
A. Property enquiries are a set of searches that we conduct on relevant government authorities to ensure that the property is not adversely affected. For example, we search the RTA to ensure that your property will not be required for resumption.

Q. When is stamp duty payable?
A.Stamp duty is due on settlement or 3 months after exchange of contract, whichever occurs first.

Q. What is settlement?
A. Settlement is when the vendor’s conveyancer and bank, the purchaser’s conveyancing, and their bank meet to exchange documents. Once all parties have received the documents that they require the funds are then handed over and settlement is complete. You will then be notified and you legally own the property.

Q. Do I need to attend settlement?
A. No. We will arrange for settlement agents to attend on your behalf.

Q. Do I need to insure the property before settlement? Do I need to have the property insured before settlement?
A. No, not unless you take occupation of the property prior to settlement. You will need to arrange for the property to be insured in your name from the date you become the owner. This is usually organised several weeks prior to settlement. In some circumstances insurance will be required before you become the owner – such as if the vendor agrees you can move in before settlement.

Q. Do I need to do a final inspection of the property before settlement?
A. This is strongly recommended to ensure the property is in the same condition as when you signed the contract. Once settlement has taken place there is usually no recourse against the vendor.

Q. Will the First Home Owners Grant be available for use on settlement?
A. Yes so long as the forms are lodged with your mortgage provider well in advance of settlement. We will liaise with your mortgage broker or provider to ensure that they have submitted the forms to the Office of State Revenue for processing.

Q. When will I get the keys to the property?
A. Once settlement takes place you can collect the keys from the real estate agent and start moving in!

Q. Do I need to advise the water authority, council or the valuer general of the change of ownership?
A. No. We will arrange this on your behalf.

Q. Do I need to advise the electricity, telephone, gas or any other services companies of the change of ownership?
A. Yes. You may wish to start arranging this shortly after exchange of contracts to ensure that services are ready when settlement takes place.