Newcastle Living Magazine
Edition 10
Reader Q&A
If I make an offer on a property, when does it become binding and what if I change my mind?
Shaun Elms
Licensed Real Estate Agent and Auctioneer
That’s a pretty important question. An offer, whether it’s verbal or even in writing, does not obligate either a buyer or a seller until a contract is signed, the deposit is paid and the contracts are dated and exchanged. Exchanging is essentially swapping contracts, buyer’s contract goes to the seller’s lawyer and the seller’s signed contract goes to buyer’s lawyer. Unless this entire process occurs – and in particular the dating of signed contracts and paying off a deposit – there actually is no formal agreement. Once exchanged , however, you’re obligated and rescinding an agreement may have significant financial impact on the person residing. In short, if you want to buy a property you need to sign a contract, pay a deposit and make sure the contract is dated and exchanged.
My home loan is going to come off fixed rate and change to variable and my payments will double. I’m going to need to sell. What should I do?
Mel Payne
Licensed Real Estate Agent and Auctioneer
Planning is fundamental. Reach out to a trusted agent as soon as possible. First of all, get an appraisal – these are free – and find out what your home is worth if sold today, then discuss selling and change over costs if you are going to buy again. Make a plan around the best course of action. It’s much safer to be selling when you are not under pressure rather than if repayments are affecting your lifestyle and creating pressure.
I have modifications on my house without approval and am really worried that when I am going to sell it’s going to come back and haunt me. Do I ring the council and tell them or just hope for the best?
Brett Bailey
Licensed Real Estate and Auctioneer
Ironically this is a very normal thing we find. As Newcastle’s full of homes that have been built at times 100 plus years ago – there are often many parts of a house that the council have no records on. You do need advice from a professional before embarking on rectification. If the council was going to target every unapproved modification to a property that existed in the region, the job would be simply impossible. The area of concern needs to be examined based on current laws, and also when the modifications occurred and additionally what impact on the home’s value the modification actually has. For example an unapproved swimming pool would be a major problem, and something that needs addressing immediately, however closing in of a verandah or building a small deck on to a property – may not be a concern at all. But regardless, it’s still important.
I have an investment property and have had a tenant there for years. I’m pretty sure the rent is too low – last increase was three years ago, can I increase the rent and if so how much?
Vivian Rendina
Property Management Business Development Officer
Rents are on the rise, and this has been impacted by the shortage of property and is going to continue to be the case as interest rate rises affect investors. Although tenants themselves are under pressure with rising rent costs, so are property owners with huge increases in repairs, maintenance, rates, insurance and mortgage repayments. It’s prudent to do a yearly rent analysis on any investment properties you have and put in place an increase as permitted to keep your property in pace with the market. This can’t be done in a fixed term with a fixed rental amount but, once out of a fixed term, you have the right to ask for an increase in rent. The tenant also has the right to decline the increase and look for alternate lodging, so this is also important to consider.
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