You’ve done your research, found the property that meets your investment objectives, now you need to close the deal in the best way possible!
It helps to use a competent and qualified conveyancer or solicitor to handle the legal side of the purchase as this will facilitate a smooth settlement. When you are at the stage of making an offer it would be to your advantage to have decided on who you are going to appoint as the conveyancer. Most mortgage brokers have a preferred conveyancer that they use. This is helpful as they will have an established working relationship and both should be working for your benefit. However it is important that you use someone you are comfortable with and that you trust.
Most sales are handled by a real estate agent so it’s a good idea to remind yourself that the agent is working for the seller not the buyer. There is a good chance that you will have established some kind of a relationship with the agent during property inspections and while you may think they are going to negotiate with the seller on your behalf they are employed by the seller.
The agent is obliged to pass on your offer to the vendor, it is up to the vendor to reject or accept your offer, and it is not up to the agent.
Your offer should include the price you are prepared to pay, any conditions you would like to include – generally I recommend that any offer should be subject to finance approval as well as building and pest inspections but there may be other conditions that would like to include such as repairs or maybe you want an extended settlement date.
Although there are general terms and conditions on a contract of sale, these are not necessarily cast in concrete and can be negotiated with the seller. Make sure that you cover all the conditions you want in the offer to purchase.
It is quite normal for the seller to alter your offer to a higher price or other alternative conditions, you should be prepared to negotiate – it may be an idea to allow a bit of room for negotiation on your initial offer.
There are additional items that a buyer may want to include in a contract, such as:
- The contact should be subject to and conditional upon you the buyer being satisfied with the results of any investigations, inspections and searches on the property within a reasonable time period. (you would need to determine what is reasonable)
- Include a reasonable expiry date and time on your offer – you want an answer from the seller. You don’t want to be left for days while the seller makes up their mind and looks at alternative offers. You don’t want your offer being used as a tool to drive up the price with a different buyer.
KEITH MARSHALL | DIRECTOR
AUSTRALIAN MORTGAGE AND FINANCIAL ADVISERS
The information provided in this page is general in nature and does not constitute personal financial advice. The information has been prepared without taking into account your personal objectives, financial situation or needs. Before acting on any information you should consider the appropriateness of the information with regard to your objectives, financial situation and needs. You should seek independent advice from your financial adviser before making any decisions.
AUSTRALIAN MORTGAGE AND FINANCIAL ADVISERS (AMAFA)
Phone: 07 3378 2056
Fax: 07 3378 2069