The process of buying a home in Queensland
Are you looking to buy real estate in the Sunshine State? We have outlined all the resources you need to achieve a successful purchase.
The Sunshine State is Australia's third largest city is quickly becoming one of the top places to live in Australia. Recently awarded as being the second best place to live (Movehub.com) thanks to our rural laid-back lifestyle, affordable housing and easily accessible public transport allowing for simple access to the CBD. With bustling nightlife and an abundance of attractions it blends everything that is great about Australia into one large state.
So how do you go about buying your own slice of paradise in Queensland?
There are a few main ways that buyers choose to buy property in Queensland, and working out which option is best for you is something that your local real estate agent and finance broker can assist you with.
Private Treaty - This is the most common process of how homes are advertised for sale in Queensland. You browse through the advertised home for sale, and make an offer on the property you like based on the listing price. If your first offer is not successful you then negotiate with the seller via the real estate agent until you both come to an agreed price for both parties. Some real estate agents are more recently starting to advertise a private treaty home without a price, but may offer a price guide. If you are unsure how much you should offer, and the home is not an Auction, the real estate agent will provide you with a price guide or a list of comparable properties within the area. It is then up to you, the buyer to determine how much you are willing to pay for the property.
Auction - The auction process is considered a ‘one-off’ event in which you inspect the property and carry out any due diligence (such as building and pest and finance approvals) prior to the auction day. On auction day you register as a bidder, and compete with other registered bidders, whoever has the highest bid over the reserved price at the auction will be the new owner of the home with no cooling-off period applicable.
Tender - A tender is more common in a commercial setting, however, an owner can sometimes choose to use this option to sell their property if the property is different, or larger compared to anything else in their local market. In this process there is normally a time-frame to which the agent requests all offers to be submitted by, along with a 5-10% deposit. Once the time-frame has come to an end, the real estate agent then presents all offers to the owner, and the owner will then accept or reject the offer depending on whether the offer and the conditions meet their wants and needs.
Off the Plan - This method is popular among new development areas. This process involves buying the property before it is officially built. Usually this is done by engaging developers, or their sale representatives. You can normally choose between multiple different designs and can upgrade the fittings and fixtures in the property to suit your needs and budget, this allows for the entry price points to be quite low for the basic fittings and fixtures. This is a popular option for first home buyers, and experienced property investors who can get the most back on grants and depreciation when purchasing a brand new home.
Preparing to pay for a property in Queensland - what to do before signing the dotted line
One of the first steps when buying a property in Queensland is to ensure you can first afford to buy the property - as well as the associated land taxes and insurances that come with owning your own home. A deposit for a home is normally between 10-20% of the total purchase price. For more information on housing finance it is important to speak to your bank or broker.
Just like any other state or territory in Australia, buying a property in Queensland comes with its own specific set of costs and taxes. A general list of these costs have been gathered below:
Stamp Duty - How to calculate stamp duty?
Loan establishment fees (up to $1,000)
Legal fees for the transaction (between $1,500 and $3,000)
Building and pest inspections (up to $800)
Valuation fee (up to $600)
Swimming pool inspection (up to $500)
Rates and land taxes
The above is a broad list of some of the costs associated with purchasing a property, however, there can be other costs, ensure you speak to your broker or bank to discuss your financial situation.
There are also grants applicable with some property purchases in Queensland. Some of the grants that may be available to you:
For more information on financial help and concessions when purchasing a home visit the Queensland Government website - Financial help and concessions.
How to find a property to buy in Queensland
Once you are ready to start tackling the property market, an important step is finding out where properties are advertised for sale. Realestate.com, domain and your local real estate agency are all the best places to start your search. However if you are having difficulties finding a property, or you are too busy or in another country you can appoint a buyers agent to help you find your dream home.
Narrowing down your search by researching the area you want to live in
Deciding on which area to purchase a property can be an important decision. You need to weigh up the pros and cons of the individual areas throughout Queensland, for example if you are having your employment transferred, and your office will be located in the CBD, you may decide to choose a property within a close proximity to the CBD. However, if you are not relying on a job transfer, or you have not yet secured employment, you may wish to broaden your property search throughout Queensland, and then start to look for employment once you have settled into your new home.
Choosing a suburb that meets your needs, and financial requirements is important, if you are unsure where you should start your search, we suggest using suburb guides such as realestate.com’s neighbourhood page. You can choose a suburb and relative property based on your affordability, and housing requirements, as well as see a full list of all the ‘popular’ suburbs in Queensland.
Standard terms and conditions of a sale contract in Queensland
The sale contract is a legally binding agreement between you and the seller of the property, and it is crucial you go through the document in its entirety with your solicitor or conveyancer prior to signing. A sales contract may look like a scary document full of clauses and fine print, however, the information required is usually just standard personal information, and any terms and conditions you wish to include in the contract. These conditions should be discussed with the real estate agent, or seller prior to you approaching the contract stage.
Price is not the only condition of a sales contract you should carefully consider. If you are purchasing a home via private treaty you will also need to consider the standard terms and conditions of a sales contract. Some of the standard terms and conditions are listed below:
Building and pest inspection - Generally 7 days from the date of the contract.
Finance sufficient to complete the purchase - Generally 14 days from the date of the contract.
Sunset clause - If you need to sell another property before you can purchase this property.
Due diligence clause - this clause allows the buyer to undertake any searches they find relevant on the property, such as future impending development’s, council approvals for work completed, or more information regarding the body corporate appointed.
Deposit amount and due date - an initial deposit is usually required at the time of signing the contract, then it is common that a second deposit may be required once all conditions of the contract have been met and the contract is officially considered unconditional.
Settlement Date - The settlement date can be written in different ways. For example it can be written as an exact amount of days from the date of the contract eg.30-days from the contract date, or as a specific date decided upon between the parties (seller and buyer). Specific dates work well for holiday periods, such as when the 30 day date may fall in the middle of the Christmas holiday break.
Things to be considered when you are entering into a sales contract in Queensland
Building insurance - Building insurance on the property will need to be taken out as soon as the contract is considered an official contract (once it is dated and signed by all parties). As a buyer the property becomes your risk at 5pm the second business day after the contract date. Although the seller does have responsibility to look after the property during the settlement period, it is in your best interest to purchase insurance so you can be certain that a third party will step in and protect you should any misfortune befall the property, such as a fire or flood claim on the property.
The Cooling off Period - The cooling off period is a time period within which you can choose to exit from the contract without providing the seller any reason. It is a right that you have as the purchaser of the property. However please note that the seller has the right to claim 0.25% of the purchase price offered by you as penalty for exercising your cooling off right. The standard cooling off period in Queensland is 5-business days from the day you or your solicitor/conveyancer received the fully signed contract.
What is Settlement?
Settlement is the day when the property will be officially yours. It is an event on the settlement day at a specific time, decided upon by the parties solicitors where the solicitors or conveyancers come together to exchange documents for payment in the form of bank cheques. There is no need for the sellers or buyers themselves to attend the settlement in their personal capacity. Once settlement has occurred successfully, you should be duly notified as it is the point when the property becomes legally yours.
Registration of Transfer - Registration of a property transfer and other tidal documents is an event that occurs after settlement, and is usually completed by your financier or conveyancer. Once completed the property will be officially recorded on the Land Register as proof and declaration to the world that you are the owner of the property.
For more information regarding the purchasing process of a home in Queensland the qld.gov.au page is very informative.
Please note that any information provided in this blog is for general knowledge only, and professional advice and consultation should be sought prior to purchasing a home in Queensland.