The Buying Process

Purchasing residential real estate can be a very exciting process, however it can also be a confusing time for the prospective buyer. As you may already be aware, different agencies usually have different sets of rules and standards, so we would like to inform you of the buying process should you decide to purchase a property through Raine & Horne Crows Nest.

Should you decide to secure or make an offer on one of our listed properties, we will ask you to confirm the following details, enabling us to help you in the best possible way:

  1. the actual purchase price you will be paying for the property
  2. the method by which you choose to pay the 10% deposit (e.g.) bank cheque/deposit bond
  3. the settlement period you may require
  4. the name of your chosen solicitor/conveyancer
  5. any special conditions or requests that you may have so that we can inform the vendor (property owner)


Once an agreement on price, settlement, conditions etc. has been reached with the vendor, the sale can proceed. An exchange of contracts is the only way to actually buy and sell a property.

EXCHANGE OF CONTRACTS

The exchange of contracts occurs when the purchaser and vendor each sign an identical copy of the proposed Contract for the Sale of Land. The exchange of contracts can be made according to terms under any of the following options:

Option 1 - Unconditional Exchange

This means the purchaser’s solicitor has signed a 66W certificate. This certificate will waive any cooling-off period and makes both parties committed to an instant, legally binding relationship. There is no turning back. This option also applies when a purchaser is the successful bidder at an auction (where contracts are unconditionally exchanged).

Disclaimer: the information provided is intended for educational purposes only. Raine & Horne Crows Nest and its agents are unable to accept any liability or responsibility whatsoever to any error or omission or any loss or damage of any kind sustained by a person or entity arising from the use of this information. It is recommended that you seek professional advice relevant to your specific circumstances before acting on the information based in this document.

Option 2 – Exchange of contracts subject to a 5 day cooling-off period

The signing of a 5-day cooling period provides the purchaser with full protection against the vendor pulling out of the sale or another purchaser paying more for the property. With the contract exchanged, the purchaser has the opportunity to organize inspections and reports, and to allow their legal representatives to check the contract. The period for withdrawal lasts for 5 working days and allows the purchaser the right to rescind the Contract of Sale for any reason. This period commences upon exchange and terminates in New South Wales on the fifth working day at 5pm E.S.T. Remember that Saturday and Sunday, along with public and bank holidays, are not business days. The vendor may extend this period by a clause in the contract or by notice in writing given before the end of the period.

This protective method requires commitment by the purchaser by means of a deposit in the amount equaling 0.25% of the purchase price. If the purchaser fails to pay the required deposit after the agreed cooling-off period, then the 0.25% deposit is forfeited to the vendor.

Option 3 – a purchaser does not wish to sign anything without their solicitor’s approval

In this case Raine & Horne Crows Nest will issue the potential buyer with what is known as a Sales Advice. This contains all the relevant details of the sale. Your solicitor/conveyancer will then make contact with the vendor’s solicitor/conveyancer and proceed with reports and reading of contracts with no determined time-frame for exchange. However it is important to note that whilst this is taking place, the property will remain on the market, and anybody wishing to make an offer can do so. By law, every offer that is put forward must be presented to the vendor. An offer may be accepted by the vendor and the interested party can sign the contract under the cooling-off period as outlined in Option 2. The property is then secured leaving you no option to purchase the property.


Disclaimer: the information provided is intended for educational purposes only. Raine & Horne Crows Nest and its agents are unable to accept any liability or responsibility whatsoever to any error or omission or any loss or damage of any kind sustained by a person or entity arising from the use of this information. It is recommended that you seek professional advice relevant to your specific circumstances before acting on the information based in this document.

GENERAL TIPS

If you want to make an offer, be certain that you can follow through by having the following items confirmed:

  1. a pre-approval of finance from your bank or lending institution
  2. your own property sold, or at least assessed for value and possible sale time
  3. you have a solicitor or conveyancer selected
  4. determine how you will be paying the 10% deposit and associated costs
  5. an idea of settlement required before taking possession

 

BUILDING AND PEST REPORTS

Before you purchase any property it is important that you receive a copy of a Pest and Building Report from a qualified inspector. Please note that this report is a complete list of defects of the property. The point to note is that all homes require maintenance and that this is known as capital improvement on the property.

STRATA REPORTS

For those intending to purchase a unit/apartment in a strata block, it is advisable to obtain access to the strata reports of the unit block. These reports provide details regarding financial balance sheets, where money has been spent, what is in the sinking fund, and the minutes of strata meetings.

BANK VALUATIONS

Do not be alarmed if your bank or lending institution request a valuation by a registered property valuer. This is normal practice of lending institutions, and serves as confirmation of the agreed sale price.

BUYING AT AUCTION

If you intending to buy at auction, all the above-mentioned must be in place. Auction day is final. If you turn up to bid and you are the highest bidder past the received price (on-the-market-price) you are the instant owner awaiting settlement of that property.


Disclaimer: the information provided is intended for educational purposes only. Raine & Horne Crows Nest and its agents are unable to accept any liability or responsibility whatsoever to any error or omission or any loss or damage of any kind sustained by a person or entity arising from the use of this information. It is recommended that you seek professional advice relevant to your specific circumstances before acting on the information based in this document.