MAKING AN OFFER ON A PROPERTY

Please find following an outline of the processes and important factors involved in the purchase of a property in Queensland.

Please read through and consider the information below when considering your next property purchase;

 FINANCES

Having a thorough understanding of your current financial situation and what you can afford, before you being to view properties, will save you both time and effort. Pre-approved Finance will give you a guide to finding a property within your budget and also act in your favour when competing offers may arise.

Know your options when it comes to Mortgage Terms whether it be through a bank or mortgage broker; time spent in seeking comparative quotes and asking detailed questions on rates, fee’s penalties and payment options could save you thousands of dollars over the life of your future mortgage.

Research your entitlements as they may increase your budget; government grants and schemes may be limited to your first home purchase. Your RE/MAX Agent will be able to assist and guide you in the right direction if required.

Know the potential costs of buying; associated costs to purchasing a property will vary in each case but may include legal fees, transfers tax, property taxes, new home landscaping etc., your RE/MAX Agent will be able to offer you advice on these matters if requires.

   

  START SEARCHING  

• Before you begin your search, start by listing down your essential requirements; are you downsizing? Looking for extra room? Must have a pool and outdoor entertaining? Working with a RE/MAX agent will allow you to narrow your ‘essentials’ into a workable list to find you the right property.
• Agent assistance; once you know what you are looking for your RE/MAX agent is able to compile a list of properties that match your needs and proceed to arrange inspection times and guide you on what to look for, conditions to consider and important local information.

   

  CONTRACT OF SALE

• You have found ‘the one’! Now is the time to complete and ‘Offer to Purchase’ form. Your RE/MAX agent will guide you through this process and also important factors to include such as Finance details, building and pest inspection, deposit monies, valuation options and conveyancing solicitor choices.
• Other options to consider in making an offer include Special Conditions of the Contract; for instance, if your current property on the market? Again, your agent will take you through this process, please ask as many questions as you need to make sure you are fully aware of your position and requirements.

   

 THE PROCESS OF MAKING THE OFFER

The process of making an offer on a property can vary from state to state. For some areas, the first offer can be verbal, for others it is written.

Before entering the ‘game’, understand the rules and preferably make the offer in writing – this eliminates any confusion concerning what the offer and conditions were.

Before getting to the offer, your relationship with the agent might consist of a number of phone calls, second and third visits to the property and possibly some inspections.

During this process and before you make an offer make sure that you:

• Have a clear understanding of the process. Get the agent to explain how they intend to make an offer. Check with your solicitor to ensure they are happy with this. Remember to seek advice from third parties.
• Know what price you want to pay for the property and work out your strategy to accomplish this.
• Research the property fully and ensure it satisfies all your requirements.
• Have studied other comparable properties that have sold in the area recently. The agent will be able to provide you with this information. You can also get this information from companies such as RP Data.
• Have an understanding of the vendor’s motivation to sell, their preferred settlement date and any other information that may make your offer stronger.
• Have patience. Some property offers can take a while and they can be stressful. Don’t rush offers if you don’t need to.

 QUESTIONS TO ASK BEFORE MAKING AN OFFER

Have there been any offers made to date? If so, what were these and why were they rejected?

Sometimes it is not the price offered which has seen an offer rejected. It might have been due to settlement dates, conditions, etc. you don’t necessarily have to up the ‘price’, it may be just changing (adding or deleting) another condition.

Did you set the asking price or did the vendor?

This question will give you an understanding of whether the vendor has an asking price they are looking to achieve. It may be that they are being unrealistic or need a certain amount for a particular reason, for example, buying another property.

When did the property come onto the market? Are you the first agent to offer the property for sale? Has the asking price been reduced at all?

This question will give you a handle on whether the vendor might be ready to negotiate.

 

 HOW TO OFFER AT AUCTION

Making an offer on a private treaty can be done in your own time, but an auction is different. Auctions are emotional and you have to keep cool under pressure. To get an idea of how these play out, attend numerous auctions before ‘the big one’. This way you can check out strategies used.

Before the day, have all your inspections, terms and conditions etc., completed and checked out by your solicitor.

On the day, know what you want to pay for the property and don’t deviate. Remember, deposits are 10% of the purchase price so have that available. Make sure you have the support. If you are not comfortable bidding at an auction use someone that is – a friend, relative or buyer’s agent.

 

 SHOULD I GET A VALUATION?

It is definitely worth getting a registered valuation on the property. Although this is generally done as part of the loan process. Although this is generally done as part of the loan process, your negotiations would have already taken place.

If you want to get your offer on the table, you can always add a condition that is subject to a valuation. However, the vendor might not accept this condition and you might miss out on the property.

 COMMON MISTAKES

There are some common mistakes people make when making an offer…Don’t fall into this trap;

• Playing games. Be upfront if you are interested in a property. You don’t have to give an agent your life’s history but enough information for them to know to contact you and keep you in the loop if there is movement on the property.
• Not researching. You can’t make an informed offer if you haven’t researched the market and the property.
• Talking the property down. This just gets people off side!

   

 SETTLEMENT

• Congratulations, your offer has been accepted! An interim period will follow between Contract date and Settlement of the property, where legal ownership of the property is transferred. Your solicitor or conveyancing company will look after these details for you.
• Remember, your RE/MAX Agent will be with you through every step of the process.