It's a no brainer: Home buying needs solid research
WITH median property prices hitting $655,000 across our state capitals, it's a no brainer that buying a home calls for solid research. Yet one in two Australians devote more time to their favourite TV show than they do to checking out the property they plan to call home.
Research by ME shows three out of five home owners spent less than 60 minutes inspecting the property they purchased. Not surprisingly, 26 per cent of buyers later discovered flaws with the place.
One third of people who found issues with their home turned a blind eye because they "fell in love with the property". A similar proportion admitted they lacked the experience and skill to adequately inspect the property, and about one in ten purchased anyway because they were fed up looking around for the right home.
The same study found most buyers encounter relatively minor problems like dodgy paintwork or fencing. However, others came face to face with issues that are far less easily resolved like zoning problems.
The reality is, you could spend 25 years paying off your home. So it's reasonable to invest time making sure it ticks all the boxes in terms of meeting your needs as well as delivering a clean bill of health.
- For a starters, always inspect a property more than once, and definitely on different times or days. A friend purchased her home on the basis of two mid-morning inspections, only to discover - too late, that the neighbour is a keen drummer who uses his living room to rehearse with his heavy metal band on Sunday afternoons.
- Another must-do is organising a pre-purchase pest and building inspection. It may cost a couple of hundred dollars but the results can confirm (or dispel) any niggling hunches you may have about rising damp, structural defects or pest problems. One in three homebuyers fail to arrange a professional building/pest inspection and it can turn out to be an expensive oversight if the building requires serious repairs.
- Be sure too to have your solicitor or conveyancer review the contract of sale before you sign it. No purchase is so urgent that you can't hold off just a few days to be absolutely sure about what you're committing to.
According to ME, one in five of those home owners who later identified problems say they wouldn't have purchased their place if they'd known about the issues upfront. Don't be among them.
Time invested thoroughly checking out a property before you buy is time well spent.
Paul Clitheroe is Chairman of the Australian Government Financial Literacy Board and chief commentator for Money Magazine.