Whether you are adding to your property portfolio or buying your first home, purchasing a property is a big commitment. A contract of sale is a legally binding agreement between you and the owner of the property so it’s important to get the contract right so the transaction can be completed successfully.
A real estate contract can look a bit daunting because they’re usually full of clauses and fine print.
To help, we’ve put together a list of some of the key things you should consider before entering into that all-important contract of sale.
1. check your purchasing entity
It is important to ensure the name on the contract is the correct legal name you wish to purchase the property in as changing this at a later date can be problematic and very costly.
2. check what’s included in the sale
Are you expecting curtains or pool equipment to be left behind? Make sure inclusions get noted down in the contract to avoid any uncertainty come settlement day.
Check the timing for payment of the deposit. Often an initial deposit is required the day you sign the contract and failure to make payment on time is considered a default of the contract terms.
In Queensland, the property becomes the buyer’s risk the business day after the contract is signed, so make sure you organise adequate insurance as soon as possible to avoid any complications.
Are there tenants living in the property? If so, when do they vacate? This is an important consideration if you plan to move into the property as your principal place of residence and importantly, tenants impact your ability to claim a home concession for transfer duty.
Consider how you will fund the purchase. If you require bank finance it is important the contract is ‘subject to finance’ so you have some time to obtain your unconditional loan approval with the bank.
7. building + pest inspections
It is important you conduct a building and pest inspection on the property to identify any potential defects with the property prior to the contract going unconditional. Always ask the agent to make your contract subject to a building and pest inspection where possible.
The above is not an exhaustive list of matters to consider. Before you sign a contract, you will need to get it reviewed by a lawyer to check that everything is sound. Get in touch with a business lawyer on 1300BDEPOT or contact us here if you would like to discuss or have any queries before signing on the dotted line!