The essential legal tips for first home buyers

Guest observation

Buying your first property, whether for yourself or as an investment, is arguably the most significant financial decision you'll ever make.

I've advised dozens of first home buyers and have seen how mistakes can be made due to inexperience and emotions. Some mistakes can have disastrous financial consequences.

So here are my top legal tips for first home buyers:

1.  Never trust a real estate agent.
   
   They are not working in your interests: they are there to sell their client's property. While some of my dearest friends are agents, I'd never take anything they'd say about someone else's property at face value. If they claim pets are allowed, check with the Owners Corporation or Body Corporate.
   
   If they say an off-the-plan apartment will be a certain size, ensure it's written into the contract. If they tell you to hurry and sign the contract before "it's too late", make sure you're had a lawyer look at it first.
   
   While it can feel like you've found "the one" and your heart is set on it, there are new properties coming onto the market every day of the week. It's just not worth risking your financial security by being reckless and rushing. Take the leap when you're ready: not when the agent is.
   
   
2. Don't assume anything, check!
   
   You might have grand plans for the future, but don't assume this is legally possible. Do your homework in advance.
   
   If you are thinking about knocking down an old house and building a new one, check with the Council that this is permitted under the planning scheme and make sure you know if there any easements that you could be prevented from building over. If you are planning to run a business out of an apartment, check that the Owners Corporation or Body Corporate rules allow this.
   
   If you're buying an investment property, get an independent rental appraisal. Be armed with all the information you need in order to make an informed decision - and to avoid nasty surprises.
   
   
3. Be careful with off-the-plan apartments.
   
   Spacious and well-lit display units are not a representation of your finished off-the-plan apartment. The fine print of the contract will make it clear that you cannot rely on what you see in a display unit. Some smallish one bedroom apartments can be difficult to obtain finance for. Aim to specify in the contract as much detail as possible about the fixtures and fittings.
   
   The developer will have the right to substitute these for similar brands, which is why it is important to specify a quality baseline brand. Off-the-plan developments can take up to five years to finish and the contract will specify a "sunset" date.
   
   The agent might say "x months until completion", but be prepared for the full period to run as set out in the contract.
   
   
4. Thoroughly inspect the property first.
   
   With an existing home, the condition that the property is in on the day you sign the contract is the condition you should expect to receive the property in.
   
   If the oven wasn't working on the date of sale, bad luck. Turning on all appliances, checking all light fittings, flushing all toilets and turning on all taps will give you an accurate picture of the state of the property. Look closely for newly painted gutters and window sills: are they masking rot or rust? Jump up and down on wooden floors – are they squeaky and uneven, indicating stump damage?
   
   You may even engage an independent building inspector and/or pest inspector to check for invisible but expensive problems like terminate infestation.
   
   Knowing exactly what you're signing up to can be a handy price bargaining chip when negotiating a private sale, but at the very least you'll know what you'll need to budget for by way of repairs.

Knowledge is power: happy house hunting!

Kate Ashmor is the principal of her own law firm, Ashmor Legal, focusing on conveyancing. She also serves as deputy chair of Caulfield Park Bendigo Bank and as a board member of Alola Australia. She's the immediate past president of Australian Women Lawyers and Women's Agenda's chief legal columnist.