Help! I need to urgently buy a property
What are the risks involved with quickly signing a contract to buy a property?
Over the Covid years, when the cost of borrowing money was cheap and while international borders were closed, there was a feeding frenzy in the Victorian property market. Properties often sold within a few days of being listed, and even within a few hours of the first open for inspection! Because 2023 is arguably a buyer's market (certainly for properties priced under $1M), it's less likely that buyers will need to act urgently to secure a property. However, it's still very important to consider the risks of an impulsive decision to sign a contract.
Should I buy a property without inspecting it in person first?
Only if someone you trust inspects it for you. Online photos and videos don't accurately show ceiling heights, the slope on a block, the amount of natural light entering rooms, paint finishes, whether appliances work, inside cupboards and who the neighbours are. Only a personal inspection can clarify all those items. If a family member or friend is unable to attend an inspection, a reputable buyer's advocate can help, and they can also take care of other handy tasks on your behalf.
Should I buy a property without having pre-approval?
Generally no, unless you are lucky enough to be paying cash or relying on a guarantor. Has your banker/broker checked the address of the property, to flag any potential concerns? Never solely rely on a pre-approval: it's always subject to a valuation of the property you wish to buy, so please be closely guided by your banker/broker, and always get their advice about whether to buy or not in writing.
Is it genuinely urgent, or is the real estate agent bullsh*tting me?
Remember: the agent works for the vendor and in their best interests, not yours. By sleeping on it and taking at least a day to think about it, you might change your mind, or find a better property, or think of some questions that would need to be answered before you make an offer (and getting a building + pest inspection done before you make an offer could be strategically wise).
Have all the legally required documents been included in the vendor statement/section 32, and are there any nasty special conditions in the contract?
An urgent contract review can quickly answer those questions, which is crucial if you are signing the contract under auction rules. But if you can't, for whatever reason, wait for legal advice before you sign the contract, and if it's a private sale, please insist on including this special condition (word for word):
This contract is subject to review and approval by the purchaser’s lawyer, within three (3) business days of the date of sale. If the purchaser’s lawyer is not satisfied with this contract, and does not promptly receive copies of requested documents that ought reasonably to have been included in the vendor statement/section 32, the purchaser may terminate this contract, via written notice, within five (5) business days of the date of sale, and any deposit monies paid will be immediately refundable.
Note: the above is general information and should not be considered as legal advice.
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