14. Terminology

Auctioneer and Auctions

Some Real Estate Agents are also licensed to auction properties. The Auctioneer ensures that the auction is conducted in accordance with the State’s legislation.

An auction produces an “unconditional contract”, not subject to finance or building inspection. If you want to bid at an auction, ensure you have sighted a pest and building inspection prior to the auction, and have your limit of finance pre-approved.

Building & Pest Inspectors and Inspections

Most properties have a building and pest inspection prior to a contract of sale being finalised. The Building Inspector and Pest Inspector are sometimes the same person. It is advisable for buyers to attend these inspections, and sometimes sellers are also present, in case there are questions to be answered.

Cooling Off Period

In some States, apart from auctions, property sales are subject to a cooling off period of five days, during which time the buyer may withdraw from the contract for a small penalty. This cooling off period can be waived in some cases. Note that sellers do not get a cooling off period, and once they sign the contract is enforceable.

Median House Price

The median price is the price of the property that is in the middle of all properties sold, arranged in order of price. In other words, if 101 properties were sold, the median price would be the selling price of the 51st property.

Median

Mortgage broker

The mortgage broker is the intermediary between you and the financier. These days, there are many types of property loan, tailored to meet the financial preferences of buyers and investors. The broker may work for a bank or be more independent, and shop around on your behalf for the best deal. A broker is usually incentivised by receiving a commission on any loans approved.

Property Manager

A Property Manager is employed to manage properties on behalf of owners. They arrange leases to tenants.

Real Estate Agents and Salespersons

Anyone who wishes to sell real estate must be registered as a Real Estate Salesperson and have completed approved training. Real Estate Agents undergo additional training and must be licensed. Agents are permitted to operate an agency that employs Salespersons. Agents are accountable for the conduct and representations made by their sales consultants. Agents must carry professional indemnity insurance, ensuring that if something goes wrong due to the mistake of one of their Salespersons, both buyer and seller are protected. Check that their insurance is current, if you are unsure.

 

Solicitor and Conveyancing

Buyer and seller engage a solicitor to protect their legal interests in the process from the initial signing of the contract. Solicitors have an important role in ensuring that the contract is properly completed, that the land title is properly defined, that the finance is provided, and that terms and conditions are properly adhered to. In some states, the seller’s solicitor prepares the sale contract.

Importantly, solicitors must carry professional indemnity insurance, meaning that if anything goes wrong, you have protection.

Some people choose conveyancing specialist businesses to process the transfer of title. Conveyancing specialists are required to have solicitors supervising the people undertaking the conveyancing.

Valuer and Valuations

A valuer is a person qualified “value” a property (or some other material thing), who is registered under the Valuers Registration Act 1992.

Valuations are required by a buyer’s financier before they will approve a loan. Sometimes a valuer’s valuation doesn’t come up to the sale price, causing the contract to fall over on the finance condition.