The Top 7 Things to Beware of When Buying a House

Not all of these warnings apply to all types of purchases:

1. The proposed Contract contains Special Conditions that are oppressive to your interests. Special Conditions add to or overwrite the 28 General Conditions of the Contract that were historically set down by Parliament. The Vendor adds Special Conditions to a Contract to “improve” it from their point of view, and so their merit needs to be carefully considered to ensure that they don’t mean that you lose and the Vendor wins. We recommend that we review your proposed Contract before you sign it.
2. The building has defects or a pest infestation. A qualified building and pest inspector should be engaged to inspect the property before you make an offer.
3. Illegal building work has been performed, i.e. some structural building work has been done on the property without obtaining a Council building permit and inspection. This risk can be managed by taking out a Title Insurance policy, this insurance also protects you from the consequences of other unforeseen title defects, such as part of your building encroaching onto a neighbour’s land.
4. The Owners Corporation is proposing significant maintenance work that will result in a special levy being raised. Examples would include major roof repairs, or the removal of flammable cladding. Also, the Owners Corporation may be proposing to increase its ongoing fees to maintain solvency.
5. The property may be subject to a planning overlay, such as Heritage or Bushfire Management, which may constrain what you may do with the property. It may be also be subject to inundation or a proposal by Vic Roads.
6. The property’s title may be unencumbered, meaning that the vendor has control of title and therefore could deal with it (mortgage it or transfer it to another party). We can place a purchaser’s caveat on the title for you, this forbids dealings on the title until your Transfer is registered.
7. If you are buying a property from a vendor who pays land tax on the property, then you will have to compensate the vendor for a proportionate share of their land tax assessment for the current calendar year, even if the property will be your principal residence and you will be exempted from having to pay land tax in future years. Your proportionate share of the land tax assessment will be greater if your settlement is in the first part of the calendar year.

Contact Glenferrie Conveyancing for more information.