What's your strategy after finding a place you like the look of online?

Hard to come up with a title, but I'm in a position where:

- Partner and I are about to be pre-approved for $1.2mil purchase price on our first PPOR
- We're actively looking for something to buy (preference is renovating or building ourselves)
- There are several key areas we're interested in buying in Vic, but different regions (Belgrave, Upwey, Woodend, Kyneton, Northcote, Brunswick) => All would be entirely different lifestyles, but we're both permanently remote workers and could be happy pretty much anywhere)

I have access to CoreLogic as well.

So I'm wondering what a good strategy is for finding a house, preferably off-market. Take this example:

1. I see a property get posted on Domain, look up the block / previous auction photos on CoreLogic to see if it's been worked on over time + the property's history, check the block on LandChecker, consider location + nearby schools etc

2. If I'm keen on the property, do I just wait until an OFI and then email an offer on the day? I would want to do a building + pest inspection, does this mean I can't put in an offer until this is done? And if my offer is accepted am I locked in?

3. If, say, a property is listed for $900k, and I can see that (a) sold prices in the area for comparable properties are about $150k lower, and (b) the property itself sold 5 years ago for $500k after being on the market for nearly a year, is there any sense in telling the agents I know this in my negotiations? It seems like valuable info to me, but I'm not sure how useful it is for a negotiation if there are others who might be willing to pay the higher price.


Sorry if these questions are all over the place, I'm a bit overwhelmed with the whole process!

 

Hah! Thanks for the thorough response mate, really appreciate it!

And yes, wildly different! We have friends in Woodend/Kyneton, and we're from Brunswick/Northcote area, and Belgrave we sorta stumbled up recently and fell in love with the landscape, style of houses + Sooki Lounge We don't have kids (yet) but the plan is to try soon, so it might be better for us to try a more ambitious reno in inner Melb while we have the energy/no kids and then move outward, rather than buying a 3-4 bedder in Belgrave on the offchance that we can have kids (there's a decent chance that we can't)

I know what you mean about bushfire and environmental sensitivity overlays; there are a couple of cheeeap blocks of land in Belgrave that we were daydreaming about (we would LOVE to build ourselves), but talking to an architect mate it seems like the bushfire + environmental overlays apparently mean that we'd need to permits + approval to remove trees (whole block is fronted by trees), would need a 10m gap between house and trees (including neighbours' trees, on a 20m frontage block...) and a whole bunch of other stuff which explain why no one's bought the block in a year!

Off-topic, but I'm guessing that because of these overlays there are very few new builds going up on vacant lots in the area? Seems like you'd have to do a knock-down if you wanted to build.

 

Interesting. I'm not the best at using CoreLogic TBH, I just use it mainly for seeing prices, property history, the history of a current agency campaign, I should delve a bit more into it.

And you're right on Belgrave, we don't want to spend $1mil there! The fact that houses are priced $650-750 is quite appealing to us.

Noob question: How do you define a cool/cold market segment? Recent price increases is an obvious one, # of available properties in the market, % of properties being sold off-market...

Is it just a matter of trying to buy where other people aren't?

 

Have a question about this bit. We're still in the process of getting pre-approval, it probably won't come before Xmas for us, but we have enough in cash + a deposit for a couple of places we're interested in.

Say we make an offer for $860k and the vendor accepts. When you say "$$$ with a 3 day expiry", do you mean the full $860k? Or is it just the deposit that we'd need to hand over?

I thought there was a settlement period and the full amount exchanged hands after that. I've had a go at searching the forums for a guide to buying in Melbourne but can't find a step by step, if there's a good post with info you could point me to I'd love it!

 

Probably should base your offer on recent, comparable sales. But if a seller is too ambitious, it is what it is (you either offer what they ask or walk away.

No, because 5 years is ancient history. Even last year might be ancient history. Say the vendor bought it for 10 pounds 50 years ago. So what? You are buying in the current market.

 

Riiiiiight right right, I obviously misread. So to just relay it back to you:

1. Find a place I like, arrange inspection, make sure it seems structurally sound/floors are level/ neighbours aren't obvious crackheads

2. Look over Section 32 (do I hire a conveyancer for this before putting an offer in?)

3. Arrange a building + pest inspection, and attend if at all possible

4. Make an offer, adjusting for rectification of any problems B+P inspection found. And by "Make an offer", I email the agent and say something like "I would like to make a formal offer of $860k. This offer will expire in 3 days".

If they accept the offer, then .... ??? My guess is:

5. They send a contract to me

6. My GF + I clean up the mess after ******** ourselves over the most important financial decision of our lives

7. We get a conveyancer to look over it

8. We call our mortgage broker and tell him we ready

9. We sign the contract, and at some point we transfer 10 - 20% deposit to the owner? Is that right?

10. 60 days or whatever the settlement period is passes, and then we move in


Is that about right? Any key things I'm missing?

 

You should talk to a mortgage broker first, before looking at property, to get an idea of your borrowing capacity, see if they find anything concerning on your credit report, or any potential issues with your application (self employed, not genuine savings, whatever). Give them all the documentation they ask for, then give them the second round of additional documentation they ask for.

That's step zero. ONLY after the mortgage broker says they are confident they can get you $x with a LVR of y%, THEN start looking at property.

 

@The Y-man This is so awesome! Thanks for the helpful responses, we're really green and have no familial support so it's great to find such detailed info here.

Yup, we're on it already. We've been speaking to a broker, are waiting for pre-approval to be confirmed at the moment. I am self-employed but apparently they're fine with using my last 2 notice of assessments + all of my bas statements, partner is f/t @ $140k and combined income is about $210k/yr with no debts or dependants.

Broker is very confident he can get us pre-approval for $1mil mortgage (we "only" have $190k as a deposit so we don't want to over-extend ourselves).

Do you think it's unwise if we start seriously looking this week, before the pre-approval has officially come through? There are a few places we've got our eye on and we get the feeling the owners want a sale before Christmas.

 

Gotcha. I'm guessing this only works for off-market offers? There's another place we're considering, which goes up for auction this weekend.

 

Gotcha. So for auction, what process should I be aware of?

I already have a section 32 for the property in question, it's a definitely knockdown-rebuild sorta job, hoping we can snag ourselves a bargain.