Buyers

Guide to buying real estate For Sale By Owner (FSBO)
Some people think that they need to use a real estate agent when buying or selling property. This is not true. In Australia there is no legal requirement for property to be sold through a real estate agent.

Owners are more knowledgeable about their own property
Who better to tell you about a property's features than an owner that has more than likely lived in their home for many years? The owner is likely to know what schools are in the area, the location of community amenities such as parks and where the closest shops are. Real estate agents on the other hand can be under-informed about the property that they are showing. A typical agent will often have several properties on their books at any one time and will only remember the basic details of each property.

Real Estate agents are no guarantee
Some agents will claim that by using their services buyers are protected from any misrepresentation as any disputes can be taken to a real estate tribunal. Unfortunately this is not the case. Agents found to be making false claims about a property will often claim that they are acting in good faith on the instructions of the owner therefore they are not guilty of misrepresentation. Members of these real estate tribunals are often chosen by the real estate industry and unsurprisingly dismiss many complaints brought before them.

For Sale By Owner sellers have room to negotiate
One of the main reasons that buyers chose to buy properties for sale by owner (or private sale as it is known in Australia) is that they know the owner can be more flexible on the price and both the buyer and the seller can still end up better off. As the owner is saving on the real estate agent's commission (sometimes this can be as much as 3%) they can sell the property for a lower price and still end up with more money in their pocket than they would have had they used an agent.

Buyers should not, however, expect the owner to discount their property by the full value of the commission saved. If the owner did this then they may as well give it all to the agent! It is only fair to expect that the owner will want to keep some of this saved commission as a reward for their time and effort.

Faster going direct
Real estate agents may claim that buyers can find a home more quickly by using their services as they have many properties on their books for the buyer to choose from. While this may have been true ten or twenty years ago like many other aspects of our lives the internet has changed this by offering a convenient way to bring buyers and sellers together. There are many real estate website including dedicated private sale real estate websites such as www.ownerforsale.com.au that allow buyers to compare hundreds of properties online, all for sale direct from the owner.

Real estate agents are sometimes reluctant to show homes at times other than their scheduled open house inspections. This is understandable as they may have many properties on their books and need to have some control over the viewings. An owner seller on the other hand only has the one property to sell and will often try to be as flexible as possible to be able to show the property at a time convenient for the buyer.

Get organised
Before you start to look for a property you should take the time to work out exactly what it is that you want, as this will speed things up in the long run. Make a list of all the features that a property must have and those features that it would be nice to have. How many bedrooms or bathrooms are needed? Do you have to have a garage or a pool? Don't waste time going to view a property that does not have all the features on the must have list. If after a couple of months you are still looking re-evaluate your must have list.

Finance
It is advisable to obtain pre-approval for a loan before you start looking for a home. This way you will know how much you can afford from the start and you won't waste time viewing properties that you can't afford and will avoid disappointment for all involved. Click here to get pre-qualified to purchase.

Viewing a property
Always be respectful when you are viewing a property for sale by owner and remember that it is their home. The interior decoration may not be to your taste but you can be tactful in how you express this. Antagonising the owner is not likely to result in them accepting a lower price for the property; in fact the opposite is true.

Closing the deal
Buyers should seek a professional home building inspection before finalising the deal (this is the case whether buying through an agent or direct from the owner). A building inspection will cost between $250 - $600 and usually takes a couple of hours. A separate pest inspection is also recommended. There are some companies that offer both a building/structural inspection and pest inspection which covers termites and other pests in the same report. Check to see what the report covers before you arrange it with the inspection company. This report will alert you to any problems such as termites, damp or structural irregularities. Any problems present at the time of purchase may become the buyer's responsibility to rectify as insurance policies will not pay out for a pre-existing condition.

If the owner agrees to make any alterations to the property such as removing rubbish from the backyard, make sure that this is agreed in writing before signing the contract. Likewise if you have negotiated for any fittings such as a refrigerator to be included in the sale price this should also be included in the contract.

Unless both the buyer and the seller have legal knowledge it is advisable for the contract to be handled by a legal professional or licensed conveyancer or settlement agent. As real estate agents have no legal training this would also be the case if buying through an agent.

Increase the chance of finding your dream home
Many homeowners have had previous bad encounters with real estate agents so that when they come to sell they will only deal direct with buyers. By including private sale properties in your search you cast a wider net increasing the chances of finding your dream home. If you have never bought without real estate agents being involved you may be surprised at how easy the process can be.