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Avoid getting ripped off when buying property

Making money on property is a no-brainer, right? Well, not always. We show you how to avoid a bricks and mortar lemon.

Making money on property is a no-brainer, right? Well, not always. We show you how to avoid a bricks and mortar lemon.

“You can't go wrong with property” is a commonly touted view. And the vast majority of homes can be an outstanding long term investment.

However, CoreLogic's latest Pain and Gain report1 found 9.6% of homes resold in the March quarter of 2017 sold for less than their purchase price. It meant the owners were left wearing a loss, and it's important to ensure this doesn't happen to you.

Knowledge is king

A key first step is to do some homework. Have a good idea of property values in the area you're buying, and aim to buy with your head, not your heart. Look for a home that ticks all the boxes in terms of meeting your needs rather than falling in love with just one or two features.

Don't skip the pre-purchase inspection

Once you've found a place that seems right, arrange a pre-purchase pest and building inspection. Many buyers don't, and it could see you facing unexpected costs for repairs, pest infestations – or worse, struggling to sell your home in the future because of illegal building work.

Talk the talk

Real estate agents can pepper their talk with jargon like ‘caveat', ‘DA' or ‘private treaty'. Take the confusion out of the conversation by checking out a few online glossaries (some real estate agents feature these on their websites), or talk to your Mortgage Choice broker about any terms you're unsure of.

Buying at auction – know your limit

An informed approach is especially critical if you're buying at auction. It's very easy to get caught up in the pressure-cooker environment of an auction and end up paying more than you planned – or can afford.

Your Mortgage Choice broker can give you a clear idea of your borrowing power. This is vital information to determine your bidding limit or to negotiate effectively if the property is passed in.

Talk to your Mortgage Choice broker today

Along with helping you find the loan that's right for you, your Mortgage Choice broker can answer all your property questions, giving you the information you need to find the property that's a ripper –rather than a rip-off.

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Posted in: Home loans

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