How to use property reports to research and buy a home
A huge part of the fun and excitement of looking for a new home is browsing all the real estate websites and cooing over the glossy, high–definition photos and 360–degree tours.
You can find yourself fantasising for hours about what you’d do to that particular corner of the garden, where you’d hang your guitar collection and how you’d change that dull little box room into a study…
Sometimes you hit upon the perfect property that just makes your heart go zing and you really go into overdrive. OK, it’s $15,000 above your budget, but that doesn’t matter; it’s perfect!
Just curb your enthusiasm for a few minutes at least
There are going to be things that you need to think about before you phone your home loan provider, or even the real estate agent to book a viewing.
There’s so much more to a property than just the walls and the cute reading nook, though. You have to step outside the place at least once a day and it’s important to know what you’re stepping out into. This is where property reports come in to help you to just take a step back and think with your head, not go off running to catch up with your racing imagination and heart.
What is in a property report
Keeping an eye on the real estate market is an ongoing part of being a property owner or buyer. But no one can be an expert in every property.
Now you can download property reports for homes you are interested in, whether they are for sale or not, at InfoChoice.
Real estate agents are invaluable when you’re looking for a property because they know exactly what to do at every stage – and they also seem to know the house you’re looking at now is perfect for you.
But a property report gives you the facts and arms you with essential information.
Is the property’s estimated worth about equal to the sale price? Is there anything about the place, the land or the neighbourhood that you should know about before parting with that deposit?
A comprehensive property report will include lots of details about sales and rentals in the area, as well as how often the property you’re looking at has been bought and sold in recent years.
Read the property report before you do anything
You don’t even have to order one in most instances, as many mortgage providers and estate agents offer free property reports. Infochoice now offers free property reports, so you can check out a place thoroughly before comparing home loans.
What to look for in a property report
1) The estimated value of the property
The report will give you a good idea as to the price of a property on the market. This estimated value is shown as a range, very often with a confidence level attached to it. This value is based upon data from actual sales that have been completed in the area.
If the area has had quite a lot of sales, especially of the type of property you’re looking at, for example 3 bedroom, 2 bathroom, 1 garage, freestanding homes, then the accuracy of the estimate is likely to be higher.
You should still ask for a professional valuation, though, before making any commitments. A property report is an estimate, not a valuation.
2) The sales history
If the property has sold within the last 15 to 20 years, then the sales history should be available. The report will show when the property sold, for how much and which agent dealt with it. Some sales going back well into the last century will be available on InfoChoice’s Free Property Reports.
3) Recent sales in the neighbourhood
Having this information will help you to decide whether the price estimate is accurate or not, as well as to give you a picture of the neighbourhood itself. Have a lot of places been renovated and sold for more than they were bought for?
Look up and follow other sales in the postcode area yourself to get a feel for the local market.
4) Other properties for sale or rent in the area
If you’re planning to buy an investment property, then knowing how much you could get each month in rental income is a big factor.
Similarly, if you know that three–bedroomed detached houses don’t sell for as much as the one you’re looking at is listed for, then this could be good leverage for asking for a reduction.
5) How the neighbourhood is performing in the property market
You can see how much prices in the suburb have changes in the last decade or so, which will tell you whether the area is up–and–coming or not. This is especially important if you’re planning to develop the property or live in it for a few years before selling again.
How to use property reports to save money
You already know how much a property report can tell you about the neighbourhood and the place you’re looking at, which can help you to make up your mind about whether to part with your deposit or not.
A property report can also help you to save money during the process of buying a new home, too.
If you think that a particular property is overpriced, for example, based on real data from recent and real sales in the locale, then you can ask for a reduction in the price.
Similarly, if you see that the house of your dreams seems to be below what you might expect, then you should take steps to find out what’s making it such a bargain. Has there been neighbour disputes in recent years? Is the house next to a busy road and will triple–glazing be necessary before you move in?
You should also look at property reports in your own neighbourhood
If you need to sell your existing property in order to buy a new home, then you need to know what sort of asking price is going to work best for you. Pitching too high means you’ll be stuck on the market watching your dream area get ever more expensive and pitching too low means, well, you won’t get as much as you could do. It makes sense to turn to a property report before making any sort of move.
The information contained on this web site is general in nature and does not take into account your personal situation. You should consider whether the information is appropriate to your needs, and where appropriate, seek professional advice from a financial adviser. If you or someone you know is in financial stress, contact the National Debt Helpline on 1800 007 007.