Warning against buying property sight-unseen
THE countdown to the Queensland border opening is well and truly on.
There’s an undercurrent of excitement and expectation running through the place as we anticipate the possibility of seeing family and friends for the first time in months.
Meanwhile, real estate agents are steeling themselves for what is set to be one of the busiest holiday periods on record in the expectation that a large percentage of those people crossing the border will not only be here for a holiday, but also a house-hunting mission.
And among the foray will be some people who, for fear of missing out, felt compelled to purchase a property on the Gold Coast during lockdown, sight-unseen.
For this avantgarde bunch, it will be the first opportunity they have had to see their new homes.
While many will be delighted with freshly acquired asset, I wonder how many others will be suffering post-purchase regret, after finding their dream home isn’t quite what they had expected.
Laying down hundreds of thousands, even millions, of dollars for a home you have never laid eyes on would have been considered the reserve of a property maverick not so long ago.
Yet according to consumer website Canstar, 11 per cent of Australians are willing to purchase a property without viewing it in person.
On the Gold Coast during Covid, the practise has become almost commonplace for southerners, expats and even other Queenslanders, who have come to rely on tools such as FaceTime walk-throughs and videos as their sole source of securing a home.
At the height of the lockdowns a local agent reported 20 per cent of his sales were changing hands this way, while another said their agency was selling one to two properties a week sight-unseen.
One property buying agent, however, has warned buying this way could prove to be a financial disaster.
BFP Property Buyers founder and principal Ben Plohl says real estate should never be akin to gambling or speculation.
“If anyone wants to do that there are plenty of places to roll the dice with your finances,” Mr Plohl said.
He said investing in property, whether a homeowner or investor, was an expensive thing to do, with too much at stake to buy sight-unseen.
“Just think of it this way – would you be prepared to work for free for a year, which is the average deposit size these days, because you ‘threw your hat in the ring’ on a property that you had never even inspected?”
If local agents act ethically and reputably, and buyers carry out the required level of due diligence, such as attaining building and pest inspections and seeking legal advice, there should be little reason for a buyer to feel exposed by such a transaction.
At the same time, buyers need to remember that no agent, no matter how reputable, is likely to tell you about the noise from a main road, or that an area is plagued by mosquitoes, or under a soon to be busy flight path.
I only hope that the trusting buyers crossing the border to finally take possession of their new homes this Christmas, get what they were wishing for – or we may see a spike in properties hitting the market come February.