Buy a Real Estate in Victoria - What to do? Key takeaways from HN Conveyancing.

Purchasing a Real Estate (Property) is exciting, especially for whom are first home buyers. Hence you will easily forget or not be aware of what are key important things in a property transaction. Do not worry, we are here to help. These are key takeaways when you buy your first home or even your second or investment property.

1.   Contract of sale and Section 32 review

Before you sign the Contract of sale with the vendor, the vendor must disclose a vendor statement about the property, so-called section 32. A vendor statement is a true statement disclosing all facts and required information according to Section 32, Sale of Land Act 1962, including but not limited to financial matters, insurance, title, Plan, Zoning, Notices, Services not connected to the land, Any details on planning permit, building permits, owner builder works or warranty insurance (if applicable), Owners Corporation (if any). We suggest you read and understand the vendor statement before you enter the Contract. If you are not sure how to read the Contract and the Vendor statement, please contact our office for assistance.

2.     Finance

If you are seeking finance, please obtain a loan approval as soon as possible. At least you should have a pre-approval before you sign the contract, and you should have a finance clause as a part of your offer (not with an Auction contract). The finance clause should state clearly the financial institution's name, loan amount, and the due date. Once the vendor accepts your offer, you should be mindful of the due date. If your finance is not unconditionally approved by the due date, you should seek an extension on the finance clause from the vendor. If you do not, you are deemed to satisfy the finance clause, which means you go ahead with the purchase regardless of your financial status.

The finance clause is also a precedent condition of the Contract, which means that if your finance is not approved, you might end the Contract by serving a written notice to the vendor, given that you have fulfilled all other conditions stated in the Contract, especially not in default under the Contract.

3. Cool–off period

If you sign a private sale contract, you have three (3) clear business days after signing the Contract to end the Contract. If you wish to end the Contract within this time, you must give the vendor or the vendor’s Agent a written notice that you are ending the Contract. Be mindful of the deadline.

This cool-off period does not apply if you make an offer at an auction or within 3 clear business days before or after the auction date, or if you buy a property which is used primarily for industrial or commercial purposes; or if the property is more than 20 hectares  in size and is used primarily for farming; or you and the vendor previously signed a contract for the sale of the same land in substantially the same terms; or you are an estate agent or a corporate body.

You are entitled to a refund of all the money you paid except for $100 or 0.2% of the purchase price (whichever is more) if you end the Contract in this way.

4.     Deposit money

You must attend to pay the deposit monies by the due date stated in the Contract of sale unless an extension is granted by the vendor. Failing to pay it by the due date might result in a penalty imposed by the vendor and mean you are in default under the Contract. Please note that if you are in default, you cannot exercise other rights related to terminating the Contract should the contract be subject to finance and/or Building and Pest Inspections. The deposit should be paid to the real estate agent's trust account.

We suggest that You must verify any bank account details via phone before making any payments as your precaution to avoid the high risk of cybercrime.

5.     Stamp duty and other fees

In Victoria, most conveyancing transactions are conducted via Electronic Lodgment Network Operators (ELNO). PEXA is an ELNO. And Stamp duty must be paid at settlement. Besides stamp duty, there are fees and charges you must pay at settlement, including Registration fees (to pay Land Registry Victoria), PEXA fees, Conveyancing fees, and other disbursements.

Please contact our office via 0412770215 or book a free 10-minute consultation for a quote should you need one.

6.     Building and Pest inspection pre signing

If you purchase an existing property, it is imperative that you are satisfied with the property condition before making an offer. As after you sign the Contract, it is difficult to end the Contract if you later find out a major building defect, unless you have such condition in place. The best practice is to engage a building inspector to inspect the property before you make an offer. Or your offer should be subject to a building and pest inspection within a reasonable time (generally 14 days from the day of signing, LIV standard contract).

Kindly contact our office for full advice.

7.     Building Insurance

Unless the Contract says otherwise, the vendor carries out the risk of a building until settlement. However, as soon as you sign a contract, you have a property interest. The best practice is you should have your own building insurance in place as soon as the Contract is signed.

Kindly contact our office for full advice.

8.     Caveat.

As you are a purchaser, you have a property interest. We advise that you should consider having a caveat placed on the title. The caveat will prevent any dealings on the title by other parties. If the parties want to proceed with the lodgement, they must notify you of the transaction.

Contact our office at 0412770215 or hanh@hnconveyancing.com.au for full advice.

9.     Title insurance.

You should consider obtaining title insurance as title insurance would provide protection against loss incurred due to title and property-related defects that generally are pre-existing and unknown to you at the time of purchase.

Contact our office at 0412770215 or hanh@hnconveyancing.com.au for full advice.

10.  Final inspection

You are entitled to one final inspection during 7 days period prior to settlement to inspect the property. Please contact the Sale Agent to organise the access. The key takeaways are to check if the property is in the same condition as it was on the day of sale except for fair wear and tear.

Contact our office at 0412770215 or hanh@hnconveyancing.com.au for what you need to check at your final inspection.

11.  Verification of Identity (VOI)

Each party in a real estate transaction must have their identity verified. This requirement is mandated by the Land Registry. Without completing your verification of identity, your transaction can not proceed.

Contact our office at 0412770215 or hanh@hnconveyancing.com.au for how to complete your verification of identity.

HN Conveyancing is a conveyancing firm specialising in property transfers of all aspects in Melbourne, Victoria. We have experienced conveyancers who are passionate and professional and will ensure you have a seamless transaction and keep you informed every step of the way. Contact us at 0412770215 or hanh@hnconveyancing.com.au for your first free consultation.