Research types of property to buy

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There are various options when buying property:

Established property

Buying an established property generally means buying an older house, and maybe planning renovations and extensions.

Before you buy an established property to renovate, ask an architect, draftsperson or builder to report on the kind of work that is possible.

Even if you do not intend to renovate, a building inspection before you buy can identify repairs and maintenance requirements, and estimate the cost.

If building work has been carried out on the property in the past 10 years, check if these works were registered. You can do this by:

  • checking the vendor’s statement (also known as a Section 32), which should include these details
  • contacting the local council.

The quality and workmanship of registered building works are automatically covered by warranties from the builder. These warranties apply to the building work for 10 years, even if the property sells several times.

For more information, view our Building warranties, insurance and insolvency page.

Buying from an owner builder

An established property may have an owner-built house or include other building work by an owner builder. An owner builder is a person who:

  • used their own skills to build, extend or renovate their home
  • managed sub-contractors to do the work.

You can tell if a house is owner built, or has had work carried out by an owner builder, by:

  • checking the name of the builder on the building permit attached to the vendor’s statement (Section 32)
  • contacting the local council
  • contacting the Building Practitioners Board, at the Victorian Building Authority. The owner must also have a certificate of consent for work commenced since 2005.

If a property includes work carried out by an owner builder less than six years ago, the owner builder must provide a defects inspection report.

A copy of the owner’s certificate of insurance and the defects report will be attached to the vendor’s statement (Section 32).

For more information, view our Building warranties, insurance and insolvency page.

Apartments, units or flats

When looking at this type of property, consider:

  • Can you hear people walking and talking in other apartments? 
  • Can you smell cooking? 
  • Are you near the garbage bins or waste collection areas? Are there any odours? 
  • Is there a parking space on the title? If so, then check this matches the plan of subdivision and the contract of sale. 
  • What are the rules? Are you able to have pets?

If you are considering a strata-title property, find out about the owners corporation (formerly called the ‘body corporate’).

Strata title is individual ownership of a unit or apartment within a multi-unit complex. At settlement, you will receive a certificate of title for the unit you bought and become a joint owner of the common property (common areas shared by all the unit owners).

The unit owners are members of the owners corporation, which owns and manages the common property.

If you buy the property, you will be a member of the owners corporation. You will have the right to vote on decisions about the operation of the owners corporation and, among other responsibilities, must:

  • pay annual owners corporation fees, levies and charges
  • obey owners corporation rules. Rules may restrict renovations to the property, pet ownership and noise.

You can find out about the owners corporation by reviewing:

  • the owners corporation certificate attached to the vendor’s statement (Section 32). This has details of current fees, insurance cover and maintenance works carried out. It also details any proposed works, fee increases and any potential or existing legal claims affecting the property
  • the owners corporation manager’s details on the Business Licensing Authority’s public register of owners corporation managers
  • any contracts, agreements, leases or licenses affecting the common property
  • the minutes of the owners corporation’s annual general meetings 
  • the contract of sale.

If you are considering a strata title flat, unit or apartment, use our Buying an apartment or unit checklist.

You can find more information about how owners corporations work in our Owners corporations section.

While the flat, unit or apartment you are considering will usually be strata title, some may be company title or stratum title. A legal practitioner or conveyancer will be able to advise on how the various types of title will affect your ownership, rights and responsibilities.

Buying off the plan

Buying a house or unit before the building works have been completed is known as buying off the plan. In some cases, construction may not have started while in others it may only be partially built. The design of the building and sketches of its final appearance may be included in advertising material well before occupation is possible.

People are often attracted to off-the-plan sales as there is a reduced amount of duty (formerly stamp duty) to pay. The amount depends on how advanced the construction of the building is and its current value. If construction is close to completion, the duty is likely to be higher. You can get more information about duty by visiting the State Revenue Office website.

Other benefits for buyers include more input into the design and a price at today’s market value that is locked in at the time the contract is signed.

Buying off the plan without being able to observe the finished product has risks, including:

  • being unable to inspect the actual property. You have to rely on an artist’s impression, floor plan and advertising material for information about what you are paying for
  • differences in the expected and actual quality of the final finishes
  • unexpected changes to the plans or specifications
  • an uncertain completion date 
  • complex contracts
  • limited recourse with the builder if there is a dispute. This is because the developer, not the buyer, enters into a major domestic building contract with the builder
  • property market volatility causing the value of an off-the-plan home at settlement to be less than the contract price
  • potential issues with obtaining finance (for example, if the value of the property decreases or the completion date changes, you may have problems obtaining finance).

If you buy off the plan and the plan of subdivision is not registered, the law protects you by requiring that the deposit is no more than 10 per cent of the contract price.

If the plan of subdivision is not registered by the time specified in the contract or the default time of 18 months, you have the right to end the contract.

A contract of sale for an off-the-plan sale must contain a warning notice that contains the following information for the buyer:

  • that subject to the 10 per cent limit, the seller and buyer may negotiate on the amount of deposit money to be paid
  • that a substantial amount of time may elapse between the buyer signing the contract and owning the property, and 
  • that the value of the property may also change during the time between signing of the contract and the buyer taking ownership.

The warning notice must be conspicuous.

Buyer’s tip

If you intend to buy off the plan, get a firm completion date in writing from the developer. You should get legal advice before signing a contract.

Rural property

Before you buy, consider the unique issues affecting property in a rural zone. Some considerations are listed in our Due diligence checklist - for home and residential property buyers.

You should also look into whether your water needs will be met. Without a water entitlement, you may not have the access you need. Ensure your solicitor or agent applies for information statements from relevant water corporations for drinking water and rural water needs. Find the relevant authority on the Water corporations page of the Department of Environment, Land, Water & Planning website.

Vacant land

Before you buy vacant land, consider obtaining a soil test if you plan to build. This could avoid costly problems when you start excavation and building.

If rock must be excavated, or the site is a filled dam or on a flood plain, there will be extra costs associated with footings and foundations.

You can find more information about foundations, and display homes and land packages in our Building and renovating section.