As purchasing a house is one of the biggest commitments you’ll make in your life, it is critical you do your homework and understand all the various moving parts. But sometimes it can be hard to know where to start and what information to look for.
We understand this is a common issue, especially for first-time home buyers. That’s why we have created a short list of the most important official documents you need to get before committing to purchasing a house.
We highly recommend getting a title search on any house you are interested in. A title search will outline key details regarding the house you are looking at and potential limitations or special access you need to give people.
The key pieces of information to look at are, who the proprietor is, this is the legal owner of the house. This information should be cross-referenced against details of the selling party, to ensure everything is above board.
Secondly, the type of estate the property is and what the conditions are regarding ownership. This information could restrict what you are able to do with the property and who you need to consult if you wish to have work done on the house.
Lastly, any special interests which are rights or restrictions that are held against the title. Common rights that may arise, include easements, which allow someone to use the land for a specific purpose, such as a utility company. A covenant, which allows or restricts certain activities on the property, such as building heights, or mortgage descriptions, which outline the mortgage situation of the house.
Local council files
The most common file you’ll need to get from your local council is a Land Information Memorandum (LIM). This report is prepared by your local council upon request, and it provides a complete summary of all information and documentation the council has on the property in question on the day of the request.
In a LIM you will find information regarding zoning, any special heritage protections, unique land features or issues, outstanding rates, building permits and requests.
A LIM is a complete record of everything the council knows about the property, so it is important to note, that if the council hasn’t been informed of an issue it will not show up in the LIM.
Purchasing a house is the biggest financial commitment one will make in their life, so it is important you have an accurate reflection of the value of the property before buying.
Every three years local councils complete a rating valuation (RV), which provides them with an accurate picture of what a house is worth. This value can be easily found on your local council’s website and is often used by agents as a reference point during the sales process.
Another option for gauging the value of a property is to hire a registered valuer to complete an independent evaluation. Where an RV is used by the council to inform rate prices, getting an external evaluation will provide you with a much great level of detail into the value of the house.
If the house in question is a unit, apartment or townhouse, chances are there will be a body corporate who manages the complex. It is hugely important you understand the manner in which the body corporate is managed.
One of the best ways to do this is to ask for minutes from the last few body corporate meetings and any public budgets or financial records. These will provide you with a clear picture of how the body corporate is managed, any issues with the properties that the body corporate is responsible for and how they were fixed. You can also take the time to ask individual residents about their views on the body corporate.
If you are eager to purchase a unit or apartment, the seller is legally obligated to provide prospective buyers with a pre-contract disclosure statement before signing a sale and purchase agreement.
The information contained in this contract needs to include, body corporate levy details, a 12-month plan of maintenance work, funds held by the body corporate and whether-tightness issues.
Doing your homework before signing a sale and purchase agreement is critical to arming yourself with all the information and ensuring you are in the best position possible. While there is a lot of documents and information available, it can often be hard for first-time home buyers to know where to start.
If you are in this situation and need some help, contact us today and we can help put you on the right path.
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