Property Buying Checklist for Owners and Investors
Don’t even open that real estate portal, and don’t browse any property ads before you write down the criteria for your property buying checklist. Here are the things to ask yourself before you buy a home:
- Why are you buying the property?
- What is your dream property?
- What does it really look like?
- What is your budget?
- Prioritise your needs and wants
- Is the location right?
- What type of property?
Here’s your property buying checklist:
1. Why are you buying the property?
Are you buying the property as an owner occupier, or as a property investor?
Be conscious of the difference between purchasing for yourself to live in versus for a tenant, as this will change your property buying checklist.
2. What is your dream property?
For owner occupiers, if you had no limitations, what would your dream property look like?
- Do you want to live close to work?
- Is there access to public transport?
- Are new homes being constructed and/or old homes being renovated in the area?
- Which local amenities are important to you: shops, parks, sports, hospitals, cafes, restaurants, cinemas, childcare, preschools, primary school, high school?
- Are family and friends close by?
- Are you interested in a house, apartment or townhouse?
- Is off-street parking available?
- Are you prepared to renovate?
- Would you consider a two storey home?
- Is a modern kitchen important?
- Do you want an en-suite bathroom?
- Do you want a separate laundry?
- How many bedrooms do you want?
- Do you want a large block or garden?
- Would you like a swimming pool?
- Would you prefer views?
For property investors:
- What is the capital growth rate?
- What is the population growth rate?
- What is the residential vacancy rate?
- Is there established and/or planned infrastructure?
- What is the median property price?
- What is the rental yield?
- What is the tax effectiveness?
3. What does it really look like?
For owner occupiers, what does reality look like?
- Define your maximum budget
- Seek professional advice
- Assess your financial situation to decide how much you can afford to borrow and repay, take into account:
- your circumstances and financial commitments
- any future plans; for example, starting a family could mean a drop in income
- other possible changes, such as interest rate rises or unemployment
- Remember to also consider the other costs of buying a property, including:
- legal and conveyancing fees
- loan establishment fees
- government charges
- building and pest inspection fees
- moving fees
4. What is your budget?
Be honest with your budget – it is often better to overestimate your costs than underestimate.
5. Prioritise your needs and wants
Now start working backwards:
- Look at your dream property, and identify which features are essential and non-essential, for example:
- three bedrooms may be essential for a family of four,
- a bedroom on the first floor of a double-storey house may be essential for grandparents living at home
- Don’t be too caught up on the small details – you can add a deck in your backyard!
- Remember to take into account your long-term plans, for example:
- Are you getting married or having kids?
- Are you planning to have a career change anytime soon?
- Buying a home is a big financial commitment, and you may be there longer than you think
6. Is the location right?
Location, location, location!
- What are your preferred suburbs?
- Start with what is going to be most important to you in a new neighbourhood – good schools, commuting distance from work, public transport, crime rates, close to family and friends, proximity to amenities, or restaurant and bars
- Rank them in order of importance
- Map out which suburbs you are interested in and meet your criteria, and see if properties in those suburbs are within your budget
- If not, consider surrounding suburbs
- Be open to moving beyond where you are comfortable
7. What type of property?
What type of property are you (or potential tenants) looking at?
- Do you want a house, townhouse, apartment/unit?
- This largely depends on the area in which you choose as well as your lifestyle
- For example, a young professional may consider a studio apartment, or a family may consider a house with a large backyard
- Consider the pros and cons of new vs established properties
- New property potential benefits
- Low maintenance (convenience of not having to spend money on major repairs or ongoing maintenance too soon after purchase)
- Government incentives (stamp duty for first home buyers)
- Less affordable
- Limited value-adding potential
- Established properties potential benefits
- Renovation potential
- Negotiating power
- Less appeal
From this, you can create a property checklist with your must-haves and nice-to-haves. Bring this to inspections to help you narrow down your dream property, or investment!
Any advice given is general only and has not taken into account your objectives, financial situation or needs. Because of this, before acting on any advice, you should consult a financial planner to consider how appropriate the advice is to your objectives, financial situation and needs.