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FAQ(common questions)

1. What paperwork should I check out before buying a house?

LIM report which is a land information memorandum report this is obtained from the district council and generally cost about 200$ included in the MIM will have all information the council has on record about the house including who built it when it was built any changes from the original floor plan zoning of the property school zoning where power and water is connected to the property. Any known land defects and any other information you want to know about the property

2. What problems should I look out for when buying a house?

You can also get a registered valuation which will tell you the registered value against similar properties selling in the area and these reports include sales data and property information pertaining to the property and quite often required by the bank so secure finance. These cost approximately 400$
Problems:”things to look out for when doing a building inspection” you should also take into account the location which the property resides as this can have quite an impact on the resale value of the property.

3. Why should I use a real-estate agent rather than selling my home my self?

Well real estate agents often have a pool of buyers that they work with frequently this can mean that the process can be a lot shorter. When using a real estate agent you as the home owner do not have to worry about anything as the agent does it all for you. This includes marketing appointments ads photos websites phone calls buyer feedback and contracts all the seller has to do is sign an agreement when it comes their way once they are happy with it. Many sellers feel that the commission of an agent is going to cut into their profits by more often than not an agent will work a buyer to negate such costs.

4. What exactly does a real estate do to deserve such a large chunk of commission?

The systems and experience that a real estate agency have in place can quite often mean that as a seller you don’t have to do anything. The commission is generally just a standard fee that any business would need to run profitably. When you use an agent you are transacting the real estate asset securely and everything is being done to sell your property. For a buyer it doesn not cost anything to use a real estate agent.

5. When is the best time to buy a first home? Seasonally? And market trend wise

If you are looking to buy a house buy when the market is down as you will have more time ands more choice to make an informed decision. Now is the best time to buy a property as the prices have come back 5 percent in the previous year and have flattened off which means that you will not lose any value straight away on your npurchase but remember that real estate is a long term investiment to profit from. Also the end of winter is generally when prices of property are weakest seasonally.

6. What are common mistakes that people make in regards to wasting time and money when looking to buy and sell property

Buying: people can gt into a mode when they think they will wait for the price of a property they like to come down in price once they have decieded they like it, but in theis time other people generally are making the same moves. Then all of a sudden you have a person putting an offer in and you also want to put an offer in alongside 2 or 3 other people this is called a multi offer where you don’t have any movement to negotiate as you need to put your best offer forward on the day so you don't miss out on somebody else putting a better offer in this can mean you have lost your negotiating power and are likely to pay more than you normally would.

7. A few years ago their was the “leaky home” scandal in Auckland; are their procedures that buyers should follow in order to find these issues with the property ( LIMB report, property check by builders etc)

The leaky home saga was created by a certain type of way buildings were constructed where there was no flashing on the windows and water would get in and cause problems most of these effected homes were built in the early 90s. If you are worried about your home you are purchasing being a leaky home then you shouldget a builders report and ask for a moisture test this will confirm whether there is any water inside the house walls.

8. What should be looked for in regards to a investment property(rental)

When looking for a rental investiemtn the biggest thing to look for is the rental return at the moment the average is approximately 7% which would not cover the average mortgage there are many factors such as how many bedrooms land size, chattel that can increase the rent value of the property. Also try and buy a house that would not require huge maintainance as this would eat into the rental returns that you are creating, the best situation would be having a house covering the mortgage ie mortgage repayments are 300$ a week and rental income per week is 320$ this is called positively gearing.

9. What makes buying a home such a good investment as oppose to shares etc

Property is a long term secure and stable investiemtns with long term stable capital gains for example if you had 5 properties where the rent was covering the mortgage in ten years time each of those properties could have increased in value 80000$ gving you a total of 400,000$ capital gain and it didn’t cost you anything to have them as the rent was covering the mortgage costs.

10. A lot of lenders offer the same interest rate as one another – what other factors should I consider when choosing between banks

When it comes to finance you should use a mortgage broker as they can negotiate the best terms for your application and circumstances on your behalf. Because they deal with many different lending companies they can get better deals than you could by going straight to them.

11. Obligations to chosen realtor -
” I think my agent is doing a poor job marketing my property can I change agents?”

When decieding to choose you real estate agent to market your property you need to research and find out about them and how good they are. This means maybe going to an open home or 2 where that agent is working to get a feel for their style once you have a few agents you could be happy with invite them to your ome to do a market apraisle where you can talk with them about the marketing of your property this is always a no-obligation way to get a feel for your real estate agent. Once you decide you are haqppy with a certain agent they will get you to sign a residential listing contract generally for a 3-4 month term. The most common type of contract is signed as an exclusive agency which means that for the term specified in the contract that agent will be dealing with you that means when the house sells you pay them the fee you can not under this time use any other agent from any other company so make sure you are happy with them before you sign the agreement.

© 2008 Martin :D