Knowing what you want in a property before you start can save you a lot of time. If you set yourself clear criteria, you will find searching for a property much easier as you will be able to eliminate properties immediately that do not suit your needs. Some important questions to ask yourself when setting your criteria include:

• What can you afford? Calculate the deposit and repayments you can afford.
• What are your location priorities? Identify the areas or communities that suit your lifestyle and the people living with you. Assess your need for transport, schools, sports facilities, easy shopping, etc.·
• What type of a house will suit your needs? Decide if you are looking for a flat, apartment, townhouse or house. The floor plan is a major consideration, so you need to decide how many bedrooms and bathrooms are required, whether you need formal and informal living areas, the size of the kitchen, whether you require a high or low maintenance garden, the size of the garage or carport and whether you require wheelchair access.

Resources to help find a property

There are a number of ways to search for potential properties. These include:

• Real estate agent offices
• Real estate industry magazines
• Home ideas and lifestyle television programs
• Real estate websites

Some people use a buyer's advocate or buyer's agent, which is a professionally qualified property consultant who acts solely for the buyer by sourcing suitable properties and representing the buyer throughout the buying process.

Preparing to buy

Prospective purchasers need to do some homework. Once you have found a property or a number of properties that you like, you need to view them and make a decision based on all your criteria about which one best suits your needs. Some things to remember when preparing to buy are:

• Inspect the property. Inspections should be made at the advertised times or by appointment with the real estate agent. You may need to inspect the property more than once before making your final decision.
• Assess the property against your criteria.· Once you have found a property that suits you, it is wise to check it out during the week as well as on the weekend, as a peaceful environment one day might be quite different at other times.
• Engage the experts. You may consider having a property inspected by a builder or architect to assess whether there are any defects that might affect your decision to buy. This is particularly relevant if large-scale renovation or extensions are planned. Both Archicentre and the Housing Industry Association (HIA), among others, provide an inspection service. For a fee, they inspect and report on the state of the property, including the structural condition, damp and termites.
• Organise finance. Confirm with your financial institution or bank the amount they are willing to lend you and calculate this with your capacity to repay, without negatively impacting on your lifestyle and other financial commitments.

You will also need to take into account a number of other costs associated with buying a property for which the buyer is liable. These may include the following:

• Legal/conveyance fees
• Stamp duty on the transfer of property
• Stamp duty on the mortgage
• Loan application fees
• Insurance
• Adjustments such as council rates and water fees

Making an offer

Missing out on a property that you have your heart set on can be a very disappointing experience. Quite often this happens because the offer process is misunderstood. When making an offer to purchase a property, it is important to be aware of the following:

• The agent will submit all offers to the vendor.
• The property remains on the market while the vendor considers all offers. Just because your offer is the first one submitted, does not necessarily mean that it will be accepted.
• Your offer may include a date by which it will lapse if not accepted.
• An offer may be made subject to a finance clause, i.e. bank approval, sale of an existing property or another consideration such as a builders inspection.
• You can make your offer conditional on certain items (such as a dishwasher being included or excluded from the contract).·
• An offer is not legally binding on both parties until the buyer and seller have signed a contract.·
• A con¨tract must contain details of the property, the price, deposit and settlement terms. Once the offer is made in writing, it is then up to the vendor whether or not to accept it or whether to give other parties the opportunity to increase their original offers. The agent is not obliged to give you another opportunity to increase your offer.·
• The vendor is under no obligation until they accept the buyers offer by counter-signing the contract.

Buying the property

Once you have decided to purchase a home it means you have agreed to pay the advertised price for the property or you have negotiated a price with the vendor. Your agent will guide you through this process. Before the home is legally yours, there are a few steps that take place:

• Deposit. You may need to leave a non-refundable $1000 deposit to show you are committed to buying the property. This is something you will need to discuss with the agent.
• Exchange of contracts. This is formal legal process that creates a binding contract for the sale of real property on agreed terms. The vendor and purchaser each sign a copy of the sale contract and then exchange these documents, after which time the contract becomes legally binding on the parties. The par¨ties are then bound to proceed to settlement, subject to any cooling off period that may apply. A deposit is usually also paid by the purchaser to the vendor during the exchange process. Any party that unilaterally declines to proceed to settlement may forfeit deposit monies or be subject to a damages claim.
• Settlement. This is the final stage of the sale when the purchaser completes the payment of the contract price to the vendor and takes legal possession of the property.

Some handy tips before moving into your new property

• Connect the electricity, water, gas and telephone.
• Check the locks, burglar and smoke alarms in your new home as soon as possible.
• If you will be having children visit or live with you, ensure your house and garden are child-safe. If there is a pool, check that it is properly fenced. Is the yard safe? What about the medicine cabinet? Are there household chemicals that children would have access to?
• You may wish to have new locks fitted.
• Register to vote in your new electorate.

Buying at auction

When buying at auction, many of the steps leading up to the purchase are the same as making a traditional purchase, however, there are some specific steps that differ which are outlined below.

Before buying at auction it is important to organise your finances before making an offer or bidding at auction. Make arrangements to cover the deposit should your offer or bid be successful, and arrange to have the appropriate mortgage funds available for settlement.

Bidding

The real estate agent will be able to provide you all the information you need on how to make a bid, however, some important tips to remember are:

• Be at the auction venue early so you have time to register for the auction and settle before the auction starts.
• Once registered, you will receive a bidding card with a number on it, this allows the administrator to correctly register your bid, therefore, once the auction has started it is important to hold your number clearly in the air and use a clear voice when informing the auctioneer of your bid.

Vendor bidding

Vendor bidding is a counter bid from the auctioneer to ensure a property reaches a price at which it can be sold.

Vendor bidding is a legal and ethical process. In most states and territories, vendor bids and the identity of the bidder must be declared before the auction commences, or each time such a bid is made. Only auctioneers or other identified and legally permitted persons should make vendor bids at auction on behalf of the vendor.

Selling a property

Having decided to sell your home, you can expect to spend at least several months taking the following steps:

• Appointing an agent.
• Negotiating with your lending institution how you intend to pay out your mortgage.
• Choosing how your property will be sold, whether at auction or by private sale.
• Setting a reserve or sale price.
• Opening your property up for inspection.
• Receiving offers from potential purchasers and entering negotiations with them over the price.
• Exchanging contracts.
• Moving out.

Choosing an agent

The role of a real estate agent is to sell your home for the best price possible, as quickly as possible. Agents act in your own interests, delivering a range of crucial services from the early stages to the final settlement. These services include:

• Advising you on how much you can expect to receive for your property, and whether you should sell by private treaty or at auction.
• Advertising your property.
• Bringing your home before potential buyers.
• Negotiating the selling price between you and the potential buyers.
• Facilitating the actual sale of your property and the final exchange of contracts.

Agent's commission

Every agent you approach should provide you with a quote to sell your home, setting out a predicted selling price and the agent's fee. Remember to ask for exactly what the commission buys you. Some agents will offer newspaper advertising alone, while others may organise open house inspection days, letterbox drops and other effective forms of promotion.

Agency options

One decision you will need to make when selling your property is the type of agreement between you and the agency selling your home. There are several possible options:

• Exclusive agency agreement. This is where you deal only with one real estate agent, whose fee is payable however the property is sold.
• Sole agency agreement. The same as an exclusive agency agreement, except that the owner may sell his or her property privately without paying the agent's fee.·
• Open agency agreement. Where you engage a number of real estate agents, and only the agent who sells your property receives the commission. Under this agreement, you may gain extended coverage, but could find that the sale of your property becomes a much lower priority than if you had engaged an exclusive agent.·
• Auction agency agreement. Where your agent organises the auction of your home.
• Multiple listing agency agreement. Where your personal agent works with a co-operative network of agents to sell your home.

Setting your price

One of the most important decisions you will make in the course of selling your home is to decide on its asking price, or if selling at auction, its reserve. If selling privately, your asking price will usually be treated by potential buyers as a starting point for negotiations, and you may end up accepting an offer significantly lower.

It is important to set a price that reflects the full market value of your property yet is realistic and remains attractive to buyers. To determine how much your property is worth, you must take into account location, size, age and extras.

The next step is to find homes with features similar to yours and check how much they have sold for. Looking in real estate agent's windows, or searching the past property sales databases on the Internet will give you a good indication of how much other home owners are asking for their properties in your area. But remember, these prices may not accurately reflect the price at which the homes are eventually sold.

Remember that changes in the state of the economy and the property market may affect the value of your home. Ask your real estate agent how the sale of your home may be affected by:

• Fluctuations in interest rates.
• Property availability.
• Buyer demand.
• Market opinions and valuations.

If you are not confident that you can come up with a good estimate of how much your property is worth, your first step should be to obtain a market opinion from a real estate agent.

Real estate agents will inspect your home and offer an estimate of its worth based on a working knowledge of the local property market and recent sales prices. There is no obligation to engage the agent whom gives the market opinion, and many who intend to sell property obtain more than one opinion, agents may overestimate the price of your property. Make sure you get them to go over their analysis of the value of your home compared with what similar homes have been selling for.

Preparing your property for sale

From the moment your home is put on the market, potential purchasers will be driving by to look it over. Your agent will also arrange for prospective buyers to inspect your home at short notice, and you may decide to hold one or more Open Inspection sessions, where your home is open to the general public.

If these prospective buyers fall in love with your home at first sight, they may be willing to negotiate immediately. It is therefore essential that you get your property looking as attractive as possible.

Selling the property

Once your home has sold it means a buyer has agreed to pay your advertised price for the property or you have negotiated a price. Your agent will guide you through this process. Before the home is legally sold to the buyer there are a few steps that take place:

• Deposit. The buyer may need to leave a non-refundable $1000 deposit to show they are committed to buying the property. This is something you will need to discuss with your agent.
• Exchange of contracts. This is a formal legal process that creates a binding contract for the sale of real property on agreed terms. The vendor and purchaser each sign a copy of the sale contract and then exchange these documents, after which time the contract becomes legally binding on the parties. The parties are then bound to proceed to settlement, subject to any cooling off period that may apply. A deposit is usually also paid by the purchaser to the vendor during the exchange process. Any party that unilaterally declines to proceed to settlement may forfeit deposit monies or be subject to a damages claim.
• Settlement. This is the final stage of the sale when the purchaser completes the payment of the contract price to the vendor and takes legal possession of the property.

Some handy tips before leaving your property

• Make sure if you are moving into a new home the agent has provided you with all the keys.
• Discontinue the electricity, water, gas and telephone. Do not leave notification of the authorities till the last minute as in some cases, meters must be read.·
• Redirect your mail at the post office.·
• Advise all who need to know of your change of address. As well as family and friends, these may include your bank, solicitor, credit card company, insurance company, telephone company, Social Security, the tax office, your child's school and all the organisations and clubs you might belong to. Change your address on your driver's license.·
• Cancel your deliveries, such as milk, newspapers, etc.

Selling at auction

When selling at auction, many of the steps leading up to the purchase are the same as making a traditional purchase, however, there are some specific steps that differ which are outlined below.

The auctioneer

The first step in selecting the right auctioneer is to choose someone with a proven track record in auctions and an excellent knowledge of the local area.

The agreement

The law requires that a written contract must be signed between the seller and the auctioneer. This 'Agency Auction Agreement' sets the reserve price for your property, how much commission you'll pay, and usually gives the agent exclusive rights to sell your property for a period after the auction in the event that post auction negotiations or advertising are necessary.

The promotion

The auctioneer is experienced in planning and arranging the marketing of property including advertising. The extent of the marketing campaign will depend on the amount you are prepared to spend. The auctioneer will clearly explain to you where and how your money will be spent.

Some tips for a successful auction

• Work out the appropriate advertising budget to ensure your property is widely advertised.
• Make sure the property is well presented because a potential buyer's first impressions are crucial to a successful sale.·
• It is important that the contract be available well in advance of your marketing campaign. Advise your solicitor or conveyancer of your intention to sell your property at auction and have the contract ready to go.·
• Allow the auctioneer to arrange as many inspections with prospective buyers as possible.·
• Do not disclose or discuss your reserve price with anyone except your agent/ auctioneer.·
• Advertising material should not refer to the reserve price.

The reserve price

You have the right to set the reserve price, below which the auctioneer is not permitted to sell. Consult with your auctioneer and agent when setting your reserve price as they will be familiar with recent sales of similar property in the area. Remember to be realistic when setting the reserve price, bearing in mind supply and demand in the area as well as other general market considerations.

Who is the REIA?

Before learning more about the course of action you should take when selecting a real estate professional to sell or manage your property or assist you in buying a home, it is important that you know who the Real Estate Institute of Australia (REIA) is and the role that we play in the real estate profession.

REIA is the national association for Australia's real estate profession.· REIA is a politically non-aligned organisation that provides research and well-informed views to the Federal Government, Opposition, professional members of the real estate sector, media and the public on a range of issues affecting the property market.

Improving the professionalism of the real estate profession

The professionalism of real estate practitioners in Australia is very important to the REIA, being the national representative body.· Improvement of the skills base and the professional standing of agents is a matter attracting the attention of the REIA.· REIA is currently working with the state and territory Real Estate Institutes (REI's) to improve the level of training available to real estate agents across Australia.· The REIA is also working with government to introduce a national license in 2011 and to provide uniformity in requirements across Australia.

The industry's national guidelines for conduct will be updated with the aid of the Australian Competition and Consumer Commission (ACCC) when the legislation for a new consumer law is passed through government.

What you need to know when looking for a real estate practitioner

It is important that when you are selecting a real estate practitioner that you not only check that they are a licensed agent but that they are a member of their state or territory REI.

REI members have a commitment to service and professional standards, and are bound by strict codes of conduct. In addition, REI members have access to a wide range of professional development opportunities enabling them to enhance their skills and offer quality customer service.

How to find a Real Estate Institute qualified agent

The best way to find an agent is to make contact with the REI in the state or territory in which you reside.· You can do this by phone or email; all the relevant contact details are listed on the REIA's website at www.reia.com.au

If you don't have access to the Internet, please contact REIA on 02 6282 4277.