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Make An Offer - Finance & Property Inspection - Own Your First Home

"Making an offer" will get you prepared to sort your finance and organise
inspection and get you ready to make an offer or bid at auction.

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Be prepared! Finances and Inspections

You should already have pre-approval for your home loan, so that’s the most complicated part out of the way. Now you just have to go back to your home loan consultant with the details of the property you want to buy to get formal approval.
This is likely to take a few days, as the lender may organise an independent valuation of the property, to make sure the amount you’re offering for it is reasonable.

Organise the inspections

For any property you’re seriously thinking about buying, you should have building and pest inspections carried out. If you’re buying a unit, townhouse or villa, you’ll also want a strata title inspection. Even if you’re madly in love with the place and determined to buy it no matter what, knowing its flaws could help you knock the price down. The few hundred dollars spent for each of these inspections could save you tens of thousands of dollars further down the track. So you’ve found your dream home and it seems to be in your price range. Great! But there are still a few more steps you have to take before you can call it your own.

CHECK IT OUT! For property inspection referrals visit www.masterbuilders.com.au

Building inspection & survey

Once you receive the report, read through it carefully. Don’t hesitate to ask about anything you don’t understand. The report won’t include quotes for fixing any problems – unless you’ve specifically requested this and paid more – but the inspector may be able to give you an idea of whether repairs will be expensive or not.
Having the property surveyed is also a smart idea. A survey details the property boundaries; you don’t want to move in and find your extension plans have been thwarted because the neighbour owns half of your backyard.

Pest inspection

A pest inspection will check if borers and termites are present, and if they’ve done any damage to the structure of the property. The report should also give advice on how to deal with the pests and the cost. These destructive pests are quite common in Australian homes, even in brick and steel-framed structures, so don’t be tempted to save money by skipping this inspection.

A building inspector will look at the property inside and out, including the roof space and under-floor space, garages, sheds and fencing. Problems that might be identified could include: cracks in the walls, rising damp, a leaky roof, asbestos in the building or drainage problems.
The building inspector will also examine issues of fire-safety upgrading, noise transmission and waterproofing, giving you an idea of major costs you might incur in the future.
You can specify beforehand if there are things you particularly want the building inspector to look at, or you can ask if you can be with them during the inspection. Keep in mind that they won’t be able to identify every problem, particularly if they haven’t been able to gain access to certain areas of the house. Also, some faults, such as leaks, might not be visible or may have been temporarily patched over by the vendor.

Strata title inspection

If you’re buying a unit, townhouse or villa, you’ll want to take a look at the records kept by the owners’ corporation. You can do this yourself, but many people get their solicitor or conveyancer to do it for them. A strata inspection will tell you things like:

How much the levies are (expect to pay more if there is a pool or gym in the complex).
What the regulations are on matters such as keeping pets.
What renovations and repairs have been done and whether there are any planned.
If the owners’ corporation is being sued for anything (you could be liable if you buy the unit).

Special levies – have any been struck or are any likely to cover costly changes to the building that cannot be covered by the standard levies? Sometimes special levies costing tens of thousands can be struck to remedy faults that a building may have.
The minutes of the meetings can even give you an idea of how well the owners get on with each other.
Once you have the information in the reports, you can reassess how you feel about the property. If it has serious problems, do you still want to buy it? If so, you can reduce the amount you were going to offer, explaining that you will have to spend money on repairs, or you can specify that you want the faults fixed before you buy.

Choose a building / pest inspector

It’s important to find someone thorough and reliable to carry out your building and pest inspections, so ask friends and relatives who have recently bought homes if they have any recommendations. Otherwise, your solicitor may be able to suggest someone. You can also get a referral from an industry association such as Archicentre (www.archicentre.com.au) or the Australian Environmental Pest Managers Association (www.aepma.com.au).
Another – less advisable – option is to look in the Yellow Pages.
As well as getting a quote, you want to ask:

What their qualifications are and how much experience they have.
Whether they comply with the Australian standard.
What the report will cover (you can ask to see a sample report).
How long you will have to wait to receive the report, and whether you can get a verbal report on the day.
Whether they have professional indemnity insurance.

That way, if they miss a serious problem and you end up out of pocket, you have a chance of getting compensation.

Make An Offer - Finance & Property Inspection - Own Your First Home