How to make an offer on a home

Finding the property that’s right for you and your budget is an exciting milestone! But what happens next? We explain how to make an offer and seal the deal.

Most of us buy a home only a handful of times in our lifetime.

So it’s not surprising that plenty of buyers – from first-timers to home owners who purchased several years ago – are uncertain about the buying process.

If you’re in the dark about how to make an offer on a property, read on as we break down the steps that can take you from house hunter to proud owner.

1. Talk to us first

Before you make an offer on a home, you should be confident that you can actually follow through with the purchase.

That’s why it’s important to call us first.

We can explain your borrowing power, which together with your deposit, sets your buying budget.

While some people prefer to have home loan pre-approval lined up before they start home-hunting, it’s not absolutely necessary.

Once you’ve found the right property, however, you’ll likely want to get the ball rolling on the finance side of things straight away.

That way your home loan can be ready in time for settlement.

2. Ask for a copy of the contract

When you see a place you’re keen to buy, you can ask the selling agent for the sale contract.

Then you can have it checked out by your solicitor or conveyancer.

This shouldn’t take long. But it can alert you to any conditions that work in the seller’s favour and not yours.

Any out-of-the-box conditions, such as a quick settlement, may not be a deal breaker – they may even be used as a bargaining chip in your price negotiations.

3. Know the market

By now you will likely have checked out plenty of properties and carefully researched the local market.

This will give you an idea of what similar homes in the area are selling for.

These insights can give you an idea of what is a reasonable offer for the home you’re thinking of buying.

4. Consider trying for a discount

Even if you think the property is fairly priced, it could still be worth trying for a discount.

As a guide, CoreLogic says sellers are currently accepting a median discount of about 3.4%.

On a home priced at, say, $600,000, that can add up to a saving of $20,400.

But it does depend on the local market. Some areas are hotter than others.

The main point is to stay within your buying budget.

5. Put your offer in writing

When you’ve arrived at a price you’re comfortable with, put your offer in writing. It shows you’re a serious buyer.

What follows may be some to-and-fro in price negotiations.

When you and the seller reach a price you’re both happy with, you may be asked to pay a small holding deposit, often around 2.5% of the purchase price.

This is not the same as the 10% you will usually be asked to pay when you and the seller sign the contract of sale to cement the purchase.

Be sure to call us when your offer is accepted. We can confirm details of the property with your home loan lender and begin the process of finalising your loan.

6. Exchange contracts

It can take a few days for the sale contract to be finalised.

Use this time to check with the selling agent how you should pay the 10% contract deposit.

When the contract is ready, you and the seller each sign a copy, then swap – or ‘exchange’ – contracts. Now’s the time to hand your 10% deposit to the selling agent.

As your broker, we’ll stay in touch throughout the process.

7. The road to settlement

It generally takes 30–90 days for the sale to settle – that’s when the property is transferred into your name.

During this time, we’ll work behind the scenes to help ensure your home loan is ready to go on settlement day.

And when you receive the keys to your new home, we’ll be in touch to help you celebrate!

Want to find out more?

Buying a home can seem complex (and scary). Rest assured though that we can help break down the steps involved.

Call us to find out other ways we can help streamline your home-buying journey.

Disclaimer: The content of this article is general in nature and is presented for informative purposes. It is not intended to constitute tax or financial advice, whether general or personal nor is it intended to imply any recommendation or opinion about a financial product. It does not take into consideration your personal situation and may not be relevant to your circumstances. Before taking any action, consider your own particular circumstances and seek professional advice. This content is protected by copyright laws and various other intellectual property laws. It is not to be modified, reproduced or republished without prior written consent.