Real estate is an excellent long-term investment that can help you generate passive income. Not only that, but it also appreciates in market value over time. However, buying real estate is not just a form of investing, but is also a tedious legal process. It involves procedures such as transfers of rights and ownership, settling agreements between the buyer and seller, and many more.
Many people think that purchasing residential property from an individual is less complex than buying from a developer. That is not the case, however. Buying real estate from any type of seller is complicated. In line with that, you have to stay keen and careful in closing legal transactions regarding your purchase. In this article, we’ll provide legal tips for first-time home buyers and property investors.
Verify the ownership of the sellers
What can be worse than buying real estate only to realise that the people who sold you the property are not the real owners? If you are purchasing from an individual property owner, it’s important to ask for legal documents that prove ownership, including identification papers like a driver’s license or passport, and make sure that the identity in the title or deed matches with the IDs presented. To be sure, you can hire an expert to do a background check or simply ask people in the neighbourhood several questions.
Ensure that the annual real estate taxes are paid
To save yourself from future burdens, it’s important that you ask the seller for a copy of the tax declaration as well as the accompanying tax receipts so you can confirm if the yearly real estate tax payments are updated.
Check if the land on the title is really the land being sold
Address components such as block numbers and street names are not expressed in land titles, thus you have to verify if the real estate you’re buying will match the provided technical description in the transfer document. You can also hire the services of a geodetic engineer or a private land surveyor to validate if the property being sold is also the one on the certificate title.
Seek professional help from a conveyancer
A conveyance of property pertains to the act of transferring ownership from the rightful owner of real estate to another party. In the majority of residential real estate transactions, the conveyance is also called the sale deed.
By hiring a licensed conveyancer, you will be protected and assisted in the entire process of conveyancing which includes ensuring all the conditions are met and preparing the necessary documents for final settlement such as the deed, certificate of liens, title insurance binder, mortgage documents, and others. Conveyancers are also tasked with helping you fully understand the legal documents. Moreover, they conduct the needed research regarding the title and the property being sold and provide legal advice on the transaction.
Although costs may vary depending on your area of residence, in Townsville, Australia, a licensed conveyancing company often charges fees ranging from $500 to $800 plus additional disbursement costs.
Although it is important for you to consider factors like aesthetics, house type, amount of space, location, and other key fundamentals, it’s even more indispensable that you prioritise the legal procedures. Employing professional assistance will be very beneficial for you. Lastly, it’s important that you keep an original copy of every document you signed for the sale transaction.