August Wrap Up 2022

Greetings from Scoutable and welcome to our August Wrap Up.
 
I hope you are well.

Properties in Australia are usually sold via auction or private treaty. In Sydney and Melbourne, the majority of properties are sold via auction. However, auction clearance rates are currently sitting between 50% – 60% for both Sydney and Melbourne, resulting in many properties converting to private treaty post auction. Below is a refresh on the process of buying a property via private treaty.

For a property sold via auction (sold via public sale to the highest bidder at a set date), you need to have completed all your due diligence / research before the auction as you are buying the property unconditionally. The due diligence you should undertake includes finance / mortgage pre-approval, contract review, building and/or strata report review, investigation of council / zoning regulations, a check for development applications that could affect the property, and market research to set your price limit.

A Private Treaty sale is where a property is listed for sale with an asking price. The buyer will make an offer to the sales agent who will then present the offer to the seller and negotiations may follow. If you reach price agreement, you have two options (in NSW): - 
 
Option One - sign the contract of sale, pay 0.25% deposit and enter into a five-day cooling off period. During this period, you will complete your due diligence (if not already completed) and your mortgage broker will action your final approval of finance, including bank valuation. If during the five-day cooling off period you do not want to proceed with the purchase of the property for whatever reason, you can pull out of the contract. However, the vendor will keep the 0.25% deposit. If you continue with the purchase, on the fifth day, you are required to pay the remaining deposit - usually 10% of the purchase price. 
 
Option Two – complete your due diligence first and then sign the contract. At this point the full 10% deposit is paid and the cooling off period is waived. 

Please note, these terms can vary from state to state.

The pro of Option One is that the option to buy the property at the agreed price, is exclusively yours, you cannot be gazumped. The con is, if you choose not to proceed for whatever reason (for example, issues with the building inspection or strata report) you will lose the 0.25% deposit.
 
The pro for Option Two is that you will not pay a deposit until you are satisfied there are no issues with the property. The con is, whilst you are completing your due diligence, someone else could make an offer and you could lose the property.

If you would like to discuss the buying process in more detail, or are looking to buy property in Australia, please get in touch to learn about Scoutable's services and how we can assist with your property search.

Until next month,

Kellie Landrey | Principal Buyers Agent

PROPERTY OF THE MONTH

43 MITCHELL PARADE, PASCOE VALE SOUTH, VICTORIA

Pascoe Vale South is located approximately nine kilometres north of central Melbourne. The suburb is surrounded by its more widely known neighbours of Essendon, Brunswick West and Coburg. Pascoe Vale South is considered a gentrifying suburb, becoming a popular area due the more affordable character housing options to the neighbouring suburbs whilst providing good retail amenities and easy access to the CBD via train and tram networks.
 
43 Mitchell Parade is a prime example of the housing available in Pascoe Vale South. The property is a single level, freestanding dwelling, built in the 1950's with 488sqm of land. The property is positioned on a corner block with a northern aspect. The home accommodates three bedrooms, one bathroom, WC, living room, eat-in kitchen, garden and single lock up garage. The property is presented in liveable condition with potential to add value through renovations.
 
The property is scheduled for auction this Saturday with a price guide of $1,050,000 - $1,150,000.

If you'd like to know more about this property or any others, please get in touch.