But you have to get more practical than that, with a loan lined up and legal and other costs to be taken into account. This is a straightforward guide.
1. Talk To A Lender
2. Talk to a Lawyer
3. You Need A Strata Search
4. Get A Building Report
5. Organize a Deposit
6. Exchange Contracts
7. Settle
1: Talk to a Lender
Before making any more specific enquiries about a property, contact a bank, other lender or mortgage broker to help you get what you want.
When you have pre-approval for your loan (usually after the first meeting) you can buy an apartment and move quickly to exchange contracts.
St George Bank has mobile lending managers who come to you. At a first meeting, they will talk you through your options and provide a quote for the best home loan.
In the eastern suburbs, the mobile lender is Michelle Dub.
Phone: 0430 367 089
Email: dubm@stgeorge.com.au
Mortgage brokers help you find a home loan that you can afford and take care of a lot of legwork.
In the Eastern Suburbs:
Adrian Bartels
Bartels Property Finance
40 Macleay Street Potts Point
Mobile: 0414 857 165
Phone: 02 8354 1041
Fax: 02 9331 5300
Email: adrian@bpfinance.com.au
As well as the interest on the money, take into account that you should be prepared for:
- Stamp duty (though there are exceptions to this)
- Legal costs;
- The cost of searches and inspections;
- Owners’ Corporation fees, sinking fund contributions and liability insurance; and
- Contents insurance.
2: Talk to a Lawyer
Before you make an offer, you should get a lawyer to review the contract that the Real Estate Agent usually has at the Open for Inspection.
Lawyers who specialise in conveyancing will explain exactly what the contract entails, and can point out some features of the apartment that are not included in the deal (for example air conditioner and dishwashers).
Conveyancing solicitors have reliable contacts to arrange a strata title search and a building inspection.
3: You Need a Strata Search
A strata search tells you what money is in the accounts, what the insurances are, whether there are active disputes within the building, and whether maintenance work or significant repairs have been done recently or are planned. These will result in a levy, that could be several thousand dollars for each unit.
A strata search needs to be done by an expert such as:
Matt Trachtenberg
I+D Strata Searching
Phone: 0412 212 432
Email: matt@idstrata.com.au
Web: idstrata.com.au
4: Get a Building Report
A building report looks at the condition of the building and identifies anything that may affect the occupants, including the need for fire upgrades, dampness, waterproofing issues and noise transmission.
For example, the popularity of timber flooring has caused some acoustic problems, mainly to do with floating floors.
There can be potentially expensive problems with cheaper buildings which look financially attractive to first-home apartment buyers.
Experience pays when choosing someone to give you the building report. A local firm that handles frequent inspections is:
John Avigdor and Associates
26/167 Brougham Lane,
Woolloomooloo NSW 2011
02 93314027
5: Organise a Deposit
Make sure your home loan is approved and then organize a deposit on the property.
The contract will usually require a 10% deposit. Most vendors will accept 5%. If you don’t have the cash your lender will organise a deposit bond.
There are only 2 other financial steps you need to take:
- Sign and return the Loan Offer to the lender; and
- Sign the mortgage documents.
Experienced conveying solicitors will help you with these transactions.
6: Exchange Contracts
Once your finance is in place and you have organized your deposit, you are ready to exchange contracts with the owner.
This is handled by your lawyer.
Settlement is usually 4 to 8 weeks after exchange.
7: Settle
On settlement day you have the right to inspect the property before settlement takes place. It is advisable not to move in on the same day the property settles as this allows breathing space to resolve any disputes.
Sellers must ensure any damage to the property between exchange and settlement is repaired but they have no obligation to repair damage in existence prior to exchange unless that was agreed to as part of the sale.