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House hunting tips

House HuntingIt was a quick decision. One week we were contemplating the landlord saying he was selling up, the next we are working out our budget to pay the new mortgage. As a real estate writer I’m often saying to people “don’t be in a rush when you are buying, it’s a big decision”. But then reality strikes and you’ve got a landlord breathing down your neck keen for you to move on when your lease expires, and a family to house, including two small kids who thrive on certainty, and two little dogs who landlords never like. Nothing against the dogs personally, I think, just that they are the dreaded PETS and pretty much always, in the small type, at the bottom of the rental ads are those words. NO PETS.

So how do you buy a house in a week?

1. Save for a raining day. For some time now we have been slashing and burning our spending, knowing that we’d want to buy soon. And I mean slash – buying nothing new for a year, and sourcing toys and clothes from second-hand stalls and op shops. No pay TV, no holidays, most meals at home, and plenty of free entertainment at the park. Due to the landlord deciding to sell we didn’t amass quite the deposit we wanted but did cobble together enough to scrape in. Wary of changing incomes when you’ve got a young family, we didn’t want to mortgage ourselves up to the hilt. Hence the original plan of renting for a while, save up a decent amount and then buy a property in our new home state.

2. Take a hard look at your budget. Assess what you can afford and then find the suburbs that offer that. Looking at suburbs you think could suit and finding out their median price is a good starting point. Where we bought wasn’t necessarily the suburb of our first choice but in the end it’s what we could pay for. Rather than stretch ourselves, we went for a place that ticked many of the boxes where we knew the mortgage wouldn’t be a killer. Given it was such a rushed decision, it seemed like the safest strategy.

3. Research. Information is gold. For this purchase I trawled through houses on the market, and then looked at what had sold in the suburb over the last two years. As well as using the sold feature on Domain, I also looked at properties that have traded in the past using Australian Property Monitors’ Home Price Guide (owned by Fairfax). I compared block size, number of bedrooms and toilets, how much parking there was, and the condition of key features such as the kitchen and bathroom. I also looked at layouts using floor plans and assessed whether the living areas caught the northern sun or would need to be reconfigured. When there was no north drawn on a floor plan, I compared the property with a map to see which way the house faced.

4. Look see. Check out all the houses on the market. I tried to get around to see most things on the market in the suburbs we were looking in to get a feel for what the different price brackets buy you.

5. Building inspector. There are plenty of people who tell you that building inspections are not worth it, but I tracked down an inspector who was a star. I was on-site for the inspection so he could show me things as he went, and while he was crawling about in the roof space, it gave me time to more thoroughly investigate the house itself, and discover its charms – like the wide floorboards hidden under the carpet, and the fantastic ironing centre from the 1950s. There were also some nasties – a leaking shower that was damaging the wall, and asbestos eave linings that I would not have known about without the inspector. And because it was an auction and we were settling on how much we might bid, it was great to chew the inspector’s ear about what the property could sell for compared to others he had seen. The inspector cost $360 but was worth every cent.

6. Think outside the square. Many people want north-facing blocks but we’ve bought a south-facing one. The fantastic thing is that we happened on a house where back in the ’50s the designer knew how to chase the sun. All the living areas face north and the bedrooms south. The layout is perfect and, while the kitchen and bathroom need to be replaced, there is no major structural work needed. It’s got a biggish backyard so if we ever wanted to extend we could potentially build a separate, north-facing building out the back and link it with a hallway to the main home – a much cheaper option than having to pull off the back of the house to build onto it, and also a lot simpler renovation that would be easier to live with too.

7. Be weird and knock on the neighbours’ doors. I’m sure our new neighbour is scared about the odd busy body who has bought the place next door, but it doesn’t hurt to knock on the neighbours’ doors to ask them about the area. In the same vein, calling the local council is a good idea and they can often shed light on whether any of your immediate neighbours are planning a major renovation, and also any plans for the area in general. In this case, nothing jumped out and one neighbour was planning a deck – so it didn’t sound like they were going to knock their place down and start a rebuild anytime soon.

8. Auction strategy. With all our new knowledge about the area and its houses, it was fairly simple to settle on a price that we’d pay. There’s a school around the corner, so that added a bit more value for us than it might have done for people without children. There’s also a busy road a few hundred metres away – which could detract from the price but was far enough way not to be a factor for us. With a figure firmly in mind it made going to the auction a more straightforward process. But when it came down to bid, I realise I am easily swayed and sometimes get carried away, so my husband led the bidding. He was less emotionally attached to the home so would probably make a clearer decision about stopping at our pre-determined limit. It was a good result, we spent less than we had set as a maximum, and slightly more than our preferred price. But the vendor was 94, so it’s a nice feeling buying a well-loved home.

Story by Carolyn Boyd www.domain.com.au

Tags: advice, buying, investment, marketing, news, property, real estate, selling, tips

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