Tips for Buyers

The thrill of finding the right property, in the right area, at the right price, is something special. It's also one of the biggest financial decisions you will make during your lifetime. Residential property can be a very rewarding investment over the long term, so it is important to understand your rights and how to exercise them. It is also important to spend time working out what you need and what you can afford before you commit to the purchase.

Choosing a Location
Before you set out to buy a home, you will need to decide where you want to buy, and what size and type of home you want. These factors will affect the price of the home, which in turn will affect the amount of deposit you will need.

Make a list of the locations you would like to consider. Don't forget about the facilities available close by such as schools, shops, public transport, parks, childcare and recreation centres plus your travel time to and from your place of employment.

Methods of Sale
There are generally two methods of sale commonly used in South Australia, they being Private Treaty and Auction.

A private treaty sale is when a house is offered for sale at a negotiated price. The normal practice is for the vendor to set a price, and you negotiate with them until a mutually agreeable price is reached. Unlike at auction, the potential buyers do not know what others may be offering for the property. Private treaty sales are the most common method of sale used in South Australia.

The auction method of sale is different from a private treaty sale in that the vendor will establish a reserve price that they are prepared to accept for the property. The reserve price will not be disclosed to you or the other bidders at auction. Ultimately, the bidders determine the price they are prepared to pay for the property.

If bidding does not reach the reserve price, the vendor may decide not to sell the property. The vendor may then choose to negotiate a sale with any of the bidders or choose to put their home up for private treaty sale on the open market.

If you hope to purchase a property at an auction in South Australia, you must be registered as a bidder. You do this by providing the agent conducting the auction with your details. You will need to show proof of your identity when you register. If you are bidding on behalf of someone else you are also required to provide information about that person and present evidence of that person's identity and a copy of a document signed by that person authorising you to bid on their behalf.

Negotiating the Purchase
It can be difficult to work out how much to offer. Do you make your best offer upfront, or offer a lower price and be prepared to negotiate? If there are several prospective buyers who want to make offers, the vendor may decide to accept another offer, without giving you the chance to increase yours. If you are not confident negotiating with the selling agent, you may want to get a solicitor, conveyance or buyer's advocate to negotiate for you. Most will charge you a fee for this service.

See our Useful Links page for more information on purchasing a residential property in South Australia.