Open for Inspection: What to Ask, What to Consider

03/12/2019


You come across a listing that has you seriously excited. The location stacks up, the floorplan looks ideal, the photos have you mentally moving in and the sales copy fills in the gaps – ducted air-conditioning and a solar heated pool complete the lifestyle goals you’ve been searching for. Whilst this property may very well be the home of your dreams, it’s important to do your due diligence before you sign on that dotted line.
Questions you should ask are:
1)     How long has the property been on the market and how many times has it been on the market? You can check how many times the property has been sold on websites such as realestateview.com.au, if it has churned and burned vendors then that may raise some red flags. Same applies for a property  that has been on the market for longer than 2-3 months. It could suggest it’s priced incorrectly, or there may be other reasons that are turning buyers off. Either you or your solicitor should check the section 32 thoroughly.
2)      What renovations have been made? If there has been a significant addition made to the home you need to confirm that the renovation has been conducted with council approval and built to code.
3)      Have you had any offers on the home? This can help you determine the demand for the home and whether you need to act quickly. If offers have been declined, try and find out what the offer was (or a ballpark figure) so you can craft your own offer.
Things you should consider:
1)      Which direction does the property face? If the main living areas or bedrooms are west facing, expect them to get quite hot during the summer months.
2)      Is the house on stumps? If so, are they timber or concrete? What condition are they in? Has the house noticeably dropped in places or are certain windows/doors hard to open and close? Restumping isn’t usually a big deal but it is something you will need to factor into your budget if it is required.
3)      What state are the gutters and roof in? Repairing/replacing a roof can be quite costly.
4)      Are the electrics old and has the switchboard been updated to include safety switches?
5)     Get a building and pest inspection done. A building inspection will reveal any potential issues or major problems. It’s important to remember that the older the home, the more wear and tear it will have sustained. Any older than 40 years and there will undoubtedly be things that need updating if it hasn’t  been done already. This shouldn’t necessarily deter you, depending on what sort of work you are willing to take on you can just factor the cost of the updates into your offer.
You may wonder why we haven’t suggested that you ask why the vendors are selling. Quite simply, it’s because more often than not, you will receive a vague – and sometimes even dishonest – answer. If the reason the owners are moving is a negative one, i.e. the neighbours are atrocious or the vendors are in significant debt, the real estate agent is extremely unlikely is disclose this. If the reason is run-of-the-mill, i.e. the owners are upsizing/downsizing or seeking a sea-change, this makes little difference to how you perceive the house, nor does it give you any sort of leverage during negotiations. By all means, ask the question if you wish, but don’t expect the answer to be overly enlightening. 
Lastly, as hard as it is, try and keep your emotions in check and approach your decision with a logical mindset. So, the house is absolutely perfect EXCEPT for the fact that it backs onto a major freeway….. you may tell yourself at the time that the constant sound of droning traffic doesn’t bother you, however will you feel differently 2 years down the track? Look at the house with very critical eyes – analyse the negatives (and unless you have an unlimited budget then there will always be some drawbacks) and determine if they are just small compromises that you can live with or if they are actual deal breakers. You’re spending a lot of money and paying a significant lump of stamp duty; you want to choose a property that is going to suit your needs for many years to come.

You come across a listing that has you seriously excited. The location stacks up, the floorplan looks ideal, the photos have you mentally moving in and the sales copy fills in the gaps – ducted air-conditioning and a solar heated pool complete the lifestyle goals you’ve been searching for. Whilst this property may very well be the home of your dreams, it’s important to do your due diligence before you sign on that dotted line.

Questions you should ask are:

1)     How long has the property been on the market and how many times has it been on the market? You can check how many times the property has been sold on websites such as realestateview.com.au, if it has churned and burned vendors then that may raise some red flags. Same applies for a property  that has been on the market for longer than 2-3 months. It could suggest it’s priced incorrectly, or there may be other reasons that are turning buyers off. Either you or your solicitor should check the section 32 thoroughly.

2)      What renovations have been made? If there has been a significant addition made to the home you need to confirm that the renovation has been conducted with council approval and built to code.

3)      Have you had any offers on the home? This can help you determine the demand for the home and whether you need to act quickly. If offers have been declined, try and find out what the offer was (or a ballpark figure) so you can craft your own offer.

 

Things you should consider:

1)      Which direction does the property face? If the main living areas or bedrooms are west facing, expect them to get quite hot during the summer months.

2)      Is the house on stumps? If so, are they timber or concrete? What condition are they in? Has the house noticeably dropped in places or are certain windows/doors hard to open and close? Restumping isn’t usually a big deal but it is something you will need to factor into your budget if it is required.

3)      What state are the gutters and roof in? Repairing/replacing a roof can be quite costly.

4)      Are the electrics old and has the switchboard been updated to include safety switches?

5)     Get a building and pest inspection done. A building inspection will reveal any potential issues or major problems. It’s important to remember that the older the home, the more wear and tear it will have sustained. Any older than 40 years and there will undoubtedly be things that need updating if it hasn’t  been done already. This shouldn’t necessarily deter you, depending on what sort of work you are willing to take on you can just factor the cost of the updates into your offer.

You may wonder why we haven’t suggested that you ask why the vendors are selling. Quite simply, it’s because more often than not, you will receive a vague – and sometimes even dishonest – answer. If the reason the owners are moving is a negative one, i.e. the neighbours are atrocious or the vendors are in significant debt, the real estate agent is extremely unlikely is disclose this. If the reason is run-of-the-mill, i.e. the owners are upsizing/downsizing or seeking a sea-change, this makes little difference to how you perceive the house, nor does it give you any sort of leverage during negotiations. By all means, ask the question if you wish, but don’t expect the answer to be overly enlightening. 

Lastly, as hard as it is, try and keep your emotions in check and approach your decision with a logical mindset. So, the house is absolutely perfect EXCEPT for the fact that it backs onto a major freeway….. you may tell yourself at the time that the constant sound of droning traffic doesn’t bother you, however will you feel differently 2 years down the track? Look at the house with very critical eyes – analyse the negatives (and unless you have an unlimited budget then there will always be some drawbacks) and determine if they are just small compromises that you can live with or if they are actual deal breakers. You’re spending a lot of money and paying a significant lump of stamp duty; you want to choose a property that is going to suit your needs for many years to come.