OK let’s face it, we are in an absolute boom time with our property markets across Australia. It’s very rare that ALL markets are going up at same time as usually each operates at their own speed. But it is happening so we need to face the reality that trying to purchase a property now is so much challenging in a boom market than a normal or subdued market.
As someone who has been swinging my bat and has recently got a property in this frenzy Sydney market, I thought to share a few of my own tips for those of you who are currently swinging your bat hard in trying to win a property.
Know your maximum borrowing limit & purchase price
Property is a game of finance, so first step is to get your finance sorted out! Without finance you are even qualified to get into the game. So my first suggestion would be to sit down with your Mortgage Broker to work out how much you can borrow and therefore work out your maximum purchase price, and get finance pre-approval going.
In current enviornment chances are you will need to stretch yourself as competition is fierce, so knowing how much you can borrow/afford is absolutely crucial, and have the pre-approval in place so that way you can confidently bid without any hesitation.
Get onto agent’s database & make yourself known
Yes agents are really busy at the moment however by getting yourself onto their database and let them know what you’re looking for allows them to share with you any properties that can be relevant to you coming up in a few weeks. It’s also worth noting that some sellers prefer not to take the sale public (for example divorce sale), which means the agent may only advertise the property within their own database so that could be an opportunity for you to strike fast to avoid having to compete with the public!
Do your due diligence (DD) BEFORE visiting property
As soon as a property hit the market the clock is ticking! Time is of essence and in a booming market you just don’t have the luxury of doing your DD AFTER visiting the property.
What you should be doing is complete all the DD prior and have a figure in mind when you attend the first open. Prepare your set of questions about the property for the sales agent so you can obtain all the information leading up to making an offer after the inspection. Keep in mind a good property may not last over a week!
Don’t shortcut your checks!
Because of FOMO a lot of buyers now are shortcutting their usual checks just to try get a property. This is risky because you could overlook serious issues such as active termite, flood/bushfire or potential structural issues of the property. Always make sure you complete ALL the checks and understand the property condition prior to putting through offers. If need be engage professional services for further investigtions to minimize your risk of geting a dud property. Even second or third grade type of properties are selling like hot cake now so this is even more imperative to ensure you get a quality property.
Ask the right questions
So what should you be asking the sales agent? I have a few tips here:
– “Would the owner consider offers prior to auction?”. So you know whether you can try get the property before it goes to auction!
– “Why is the owner selling?”. This leads to understand what could tick seller’s boxes. Remember seller may be looking at upgrading/downsizing, so they may also need some time to find the next property. In that case perhaps a long settlement will benefit both you and the seller!
And if the property is of interest to you, always ask for a copy of Sales Contract and Building & Pest report to reflect yourself as an interested buyer.
Try to get the property prior to auction
In a boom market condition like now it’s almost impossible NOT to pay extra because demand is so much more than supply, especially with some really silly sold prices we’re seeing with houses in Sydney & Melbourne. So it is really a matter of how much extra you need to give to the seller. My suggestion on this is you should always avoid having to fight it out at auction. Once it goes to auction it is pretty much guaranteed to sell for a much higher price due to competition. So try negotiate through sales agent and see if you can come to an agreed price so the property don’t end up going to auction.
So there we go! A few tips for all of you who are currently competing to try get a property. It’s definitely not easy as I have been monitoring the market and swinging my bat for the last 6 months. However don’t give up no matter what, as you just need to keep swinging the bat and do your best. It’s never an easy process to buy a property in Australia and it will not get any easier next few years with low rates remains to be the case – so I wish you all the best in securing a property!