Part 2: Making the Open Home work for you

February 20, 2015

In Part 1: Buying a House – the Financial Pinch, we looked at the financial implications and decisions we need to consider when purchasing a (new) home.

In this second instalment, we’ll address the key things to look for when attending an open home and the key questions to ask the salesperson in an attempt to ensure that the buying decision provides no hidden repercussions for you and your loved ones.

It may take one, it may take twenty plus open homes, to find the place you fall in love with. The point here is the place you fall in love with. As soon as you’ve fallen in love, you’ll run the risk of making an emotional sale rather than an objective decision.

We cannot stop you from falling in love, but this guide will help put a few things into perspective and sway the pendulum back into the objective zone (with a tinge of emotion).

 

Preparing for the Open Home

We would advise that you attend a number of open homes that have the listed characteristics that you, your spouse and/or your family want in a house. Be selective and concentrate your energies on viewing properties that you want from the outset, not just those that you will settle for. For example, if four bedrooms is going to be a deal breaker, why would you consider a three bedroom home? (Unless it has the ability to extend or an office that could be converted).

The work starts before you even get to the property. Scour the local real estate pamphlets, brochures, newspapers and highlight the properties of interest.

 

Take a drive

If you have the time, take a drive around the neighbourhood of potential properties. Is it close to amenities and schools (if this is important to you)? Do the neighbours and the street look tidy? Is there junk strewn through properties in the area?

You may see from a quick look around the surrounding properties that though the home you want is amazing, the actual location isn’t – this will impact upon your desire for the house, what you are willing to pay, and of course what a potential future resale could be if you did purchase and looked to sell on in the future.

 

Ask the neighbours

One of the most cost-effective ways to get an understanding of a property and the neighbourhood is to ask a current resident! If you are able to talk to owners/renters of a property down the road, you are more likely to get honest feedback about the area and the property you are looking at.

Of note and consideration is the asking of opinions of the direct neighbours of the property. While it is possible that you will get tip-offs about the property, it is possible that bias feedback comes from these quarters due to the friendship they hold with the seller or alternatively that they are just anxious to see the back of them.

 

What to ask the salesperson?

Before asking the salesperson anything, take a look around the property and determine if it is one you could potentially want to own. There is no point in wasting your time asking multiple questions of the salesperson when you take one look around and think that it just isn’t right for you!

If the property on the surface is ticking the right boxes, it’s time to ask some big questions. Don’t feel that you’re being cheeky, you potentially could be about to part with hundreds of thousands of dollars! 

 

So what do I ask?

Some key questions to ask of the salesperson (or owner if a private sale):

  •  How old is the house?

This may lead onto further questions due to the age i.e. if it is an older house you may ask further questions around when was it last re-wired, what renovations have been made, how old is the hot water cylinder and when was it last replaced (the life expectancy of modern copper or stainless steel cylinders is 20-40 years, but mains pressure glass-lined steel can be shorter at 12-20 years[1]). The newer the house, the likelihood that these additional types of questions are irrelevant.

  • How long has it been on the market?

Asking this question, you get an understanding on what the competition is like and the salesperson is likely to state if previous offers have been made and declined, and possibly an indication of the price (range) expectation that the vendor is seeking. 

The longer a property is on the market, will tell you two things: one, the market isn’t willing to meet the sellers expectations (some room to move and a potential bargain); or two, that the seller’s motivations to sell are not urgency based and that they are happy to be in the market until the ‘right’ buyer comes along.

  • Has the seller had any offers? Much like the above question, you’ll be able to determine the demand a market for the property and get an indication on an acceptance price.
  • What parking is available? Are there any issues? This may be self-explanatory if a single or double-garage is present, but if nothing exists, it is important to know off-street parking exists.
  • Does the fireplace work and when was it last tested? An important question if your new property has a fireplace. If it doesn’t, how else is the home heated. And if it hasn’t been tested for a period of time, it may be something that is negotiated or alternatively you will know needs to be carried out when you move in and want to use it.
  • Has there been any trouble at the address or is there anything else I should know? The last thing a salesperson wants to offer up is that there was a murder in the house three weeks ago! But is important to know as it will put some buyers off, while others may see a bargain. You can also do a Google search on the address and see if this picks anything up in the search results.
  • What’s included in the sale? This will identify everything that will come with the house but more importantly provide you with a list of things you may need to purchase once moved in or what can be a point of bargaining when it comes to negotiation. For example, you may want a spa pool where one currently sits and it would be easier to purchase with the property rather than purchase new and have it installed; or the 60 inch television that currently sits on the wall of the lounge.
  • Has there been any subsidence problems? This question should not replace a builder’s report and/or LIM report.
  • What are the neighbours like? This is a leading question to determine if any previous disputes with the neighbours have been had or whether the vendor has had previous discussions with neighbours about development and what the outcome of those discussions have been.

The aim of questioning the salesperson is to gain as much information as you can and make an informed decision on whether to make an offer, and at what level that offer should be (assuming you can meet the expectations of the seller).

 

Conclusion

In this instalment we’ve taken a look at the preparation to undertake before attending an open home and the key questions to ask a salesperson once you have taken that first look around. This will give you the necessary background into whether the property should be further considered to become your new home. Ready to make offer? We’ll not just quite yet.

In part 3, we’ll guide you on the things to look out for when attending the first open home, but more importantly when you are viewing the home for a second, third or tenth time – before you put an offer on the table. Keep an eye out for part 3 in March.

Is there another question you’d ask at an open home or a preparation task you undertake before going to an open home? We would love to hear it in a comment below.



[1] http://www.smarterhomes.org.nz/energy/water-heating/

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