Just like you wouldn’t enter into a relationship or new job without asking a few questions….
For many, buying a new home or investment property is one of the biggest financial steps they will take so it only makes sense to research, and then research some more.
We have covered many of the ‘best things to do’ when looking to build or buy elsewhere on our blog, and this time we are taking your through our essential checklist for questions to ask before buying a new home or investment property.
The three main areas of consideration are the price, the age and condition of the home, and the area, such as the suburb or street.
Let’s start with the essential questions in relation to price.
1. How was this property priced
Ask to see a recent property report, and ask how the agent and owner came to the price the property is listed at. You can also ask what similar properties in the area sold for, and are currently listed at.
2. Why is the vendor selling?
This can make a difference! If the seller has already purchased a new home, or has put the home on the market due to a change in circumstances such as divorce, you may be able to negotiate a better price for a quick sale.
3. How long has the property been on the market?
Most metro areas currently have strong markets so if the home has been for sale more than six to eight weeks, take some extra time to research if it has been priced too high, or if there is something undesirable about the location.
This brings us to our next set of essential questions – all about the location, location, location.
4. What are the neighbours like?
When it comes to the suburbs, or a close-knit development, a home is only as good as its neighbours. If there is a poor relationship between people either side of your fence, you may want to reconsider unless the relationship can be repaired.
5. Is the area on an upward or downward slope in regard to property prices?
Are you buying in a suburb considered ‘the next big thing’ or in an area that will struggle to maintain its appeal? It is tempting to buy into areas that are booming, but be sure to research the reasons behind the boom and assess if they are long-term or a potential risk.
6. Is there anything which may become an annoyance?
They say those who live under a flight path eventually get used to the noise, but will you. Take time to ‘live’ in the area a little before making the commitment. Is there a main road nearby, does it get heavily congested, is there a bus stop at your front door? While the home may win you over, the suburb or street may not.
Once you have the price and location firmly assessed, it is time to take a closer look at the condition of the home.
7. Is there maintenance ahead?
A fresh coat of paint, a little landscaping, and some styling will take years off a home – but they can’t erase any structural issues. Be sure to ask about the condition and age of the roof, gutters, and even the electrical and plumbing systems in older homes. All three pose potentially expensive repairs if something goes wrong, and it is better to be prepared.
8. What features are original, and which have been replaced?
Has the home received and updates such as new wiring, dishwasher, windows, toilets, or plumbing over the years? This adds to the appeal and could mean years without having to invest a large amount on maintenance.
9. Can you see any signs of pests?
Look for damage or signs of pests such as ants, cockroaches, or mice by checking inside the cupboards in the bathrooms, laundry, storage areas and kitchen. You don’t want to move in only to be greeted by a few hundred guests.
And the final question to ask before buying a home…
10. Can you afford it?
When you find a home that ticks every item on your checklist it is tempting to relax your budget to cater for a slightly higher price, but that will only cause stress in the long term. Buying and renting have a lot of the same expenses, with homeowners also needing to ensure they have the funds for insurance, regular repairs or renovations, as well as rates and/or body corporate fees. They can all add up, and if you are already stretching the budget to cover the mortgage, each unexpected expense is going to add stress where it is not needed.
Be sure to be open and honest about your financial situation, and maybe even seek the advice of a financial planner before taking the plunge into the world of home ownership, or investment properties.