Eight surprising myths about buying a property
Buying a property is an exciting, life-changing experience, but there are many myths about the process - especially if you're a first home buyer.
1. If it's listed in the advertising, it has to work Incorrect. Just because the ad says the property has air-conditioning, doesn't mean the air-conditioning must be in good working order. All electrical and gas items at the property should always be checked, before any contract is signed = buyer beware.
2. The agent said the vendor will remove the rubbish / fix that No they won't, unless they want to. Vendors don't have to fix anything, and they can leave loose items and rubbish behind at the property after settlement. Nothing the real estate agents say, or even SMSs or emails you, is legally binding - only the contract is.
3. We have preapproval, that's enough No it's not. Preapproval is always subject to a satisfactory valuation, which could be problematic for small, new-ish, one bedroom apartments on main roads, without car parking.
4. We'll love living there Have you measured rooms to check if your furniture fits? Are your pets allowed under the Owners Corporation rules? Have you visited the property at night time, to see what the noise, traffic and lighting is like? Have you checked out the neighbours, including in the street at the back?
5. The vendor will clean it before we move in No they won't, unless they want to. The property doesn't have to be professionally cleaned, and it doesn't have to be perfect on settlement day - fair wear and tear is permitted.
6. We'll be able to move in earlier than settlement day No you won't, unless the vendor agrees to grant you a licence agreement. And they can charge you a market-value weekly licence fee (the equivalent of rent), and pass on their legal costs to you. But even if the property is empty, many vendors won't let purchasers in early, to avoid the risk that the purchaser will become a squatter if they fail to settle.
7. We can inspect the property a few times before settlement day No you can't, unless the vendor agrees. The contract allows a purchaser to inspect the property again only once, in the week prior to settlement day. However, you could try to tag along during a building and pest inspection (if the contract is subject to that).
8. Our bank needs a few extra days to be ready to settle; that will be fine No it won't. If you don't settle on the contracted settlement date, the vendor can issue a default notice under the contract, which will result in you incurring hundreds and possibly thousands of dollars in default interest and legal costs.
Note: the above is general information and should not be considered as legal advice.
Photo by Andrea Piacquadio