Purchasing a property can be like wading through choppy waters – you never know just how big the next wave might be and how prepared you need to be when it hits.
Whether you’re a first home buyer, a property investor or simply scaling up or down, the guidelines for your property purchase will often change depending on your personal circumstances and what and where you want to buy.
Equipping yourself with the right legal knowledge and tools before you enter into a property transaction is crucial so that you protect yourself and get the best deal.
So here’s some tips and advice to help navigate the legal side of a property purchase and ensure its smooth sailing all the way to the front door of your dream home:
What is conveyancing and why do I need it:
- Conveyancing is the legal process of transferring title from the seller to the buyer. It’s how you buy and sell a property. A conveyancing lawyer like lawlab will protect your rights under the contract for sale, help you navigate the conveyancing process and secure your property.
- It’s important to know that each state and territory has its own property laws and conveyancing processes so it’s essential you engage a lawyer who has experience in the state or territory you’re looking to buy in, even if they’re not physically located in that state.
- Communication is critical in conveyancing because your lawyer needs to liaise with your real estate agent, broker, bank, accountant and sellers legal team to secure your property – so choose a conveyancing lawyer that is responsive and efficient or is a member of the Rundl property network. If they’re a member of Rundl’s transparent communication network you know they won’t drag out the process.
- When buying your first property, your lawyer will undertake the critical steps of: contract review; contract exchange; search enquiries; notice of contract conditions; liaising with your bank; preparing land titles office forms; paying stamp duty; organising settlement; calculating settlement figures and attending settlement.
Avoid common first home buyer mistakes:
- It might sound odd, but a big mistake we see from some first homebuyers is going away on holiday right after signing the contract. While it’s fine to celebrate your new purchase, it’s really important to be available to sign last minute documents or at least be contactable by your lawyer – so heading overseas isn’t a good idea. However, more and more tech savvy lawyers are embracing online platforms like Rundl, which allow buyers to login from anywhere in the world to monitor their transaction and share and approve documents.
- The legal side of buying a property is full of tight deadlines, yet a common first homebuyer blunder we see is not acting quickly enough to provide information to their lawyer, which can cause major contract complications or even kill the deal completely.
- We all know legal advice doesn’t come cheap, but first homebuyers can avoid unexpected and excessive costs by choosing a conveyancing lawyer that offers a comprehensive service for a fixed fee.
- Stamp duty is a complex and variable beast in Australia. But luckily it’s your lawyer’s job to organise the correct and timely payment of stamp duty which fluctuates depending on state or territory laws, the type of property and the purchase price or value.
- For example in NSW, if you are buying a newly constructed property, as your first home to live in, for a purchase price less than $550,000 then you won’t pay any stamp duty. That could save you as much as $20,240.
- At the moment, eligible first home buyers won’t pay stamp duty in Queensland (for new and existing homes less than $500,000) and Western Australia (for new and existing homes less than $430,000). In Victoria, first home buyers may be eligible for a 50% stamp duty reduction on new and existing homes less than $600,000.
Protect yourself when buying off the plan:
- Never sign a contract without first seeking legal advice, especially if you’re buying off the plan. Developers and agents have their own interest in your purchase, but a good conveyancing lawyer is there solely to protect you.
- Make sure you double check the plans and schedule of fixtures and finishes in your contract because these are all that you have to rely on – artists impressions and marketing material of your soon to be built property are just for show.
- Always engage a building inspector before settlement to inspect the property and to make a list of the defects that the developer must fix during the defects rectification period.
Every property transaction is different and buyers will often have questions throughout the journey. Remember, your service providers – conveyancing lawyer, mortgage broker, building inspector– are there to help you at every step, so make sure you take advantage of their knowledge and experience.
Richie Muir is Legal Director at lawlab, a specialist legal services provider for property transactions large and small across Australia
Image source: http://www.greenhillslegal.com.au/gladesville-property-lawyers/