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What is "due diligence"?

Things you can do to avoid nasty surprises.

When hunting for a home or investment property, due diligence means you investigate different aspects of the property and seek more information to ensure that you have a good idea about the property and any potential issues. Once you have completed your enquiries, then you can comfortably move forward with the purchase.

 

Here are some things to consider as part of your due diligence process:

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  1. Building and Pest Inspections: To determine whether there are any building/structural defects, maintenance issues, or pest infestations impacting the property, you can arrange for a professional inspection and report.

  2. Planning and Zoning: Consider the planning overlays and zones affecting the property (such as heritage or environmental overlays), and whether these have any impact on your plans for the future use and development of the property. A search of local planning applications can reveal whether there are any future developments planned nearby, which could impact the amenity or value of the property.​

  3. Survey and Boundaries: For some properties, it might be sensible to engage a surveyor to verify the property's boundaries and check that the positions of existing buildings and fences are consistent with the legal boundaries shown on the registered plan. This should also help to avoid adverse possession claims.

  4. Utilities and Services: Checking the availability and condition of utilities and services, such as NBN, water, electricity, and sewage, is important for assessing the property's functionality and any additional costs.

  5. Legal Review: Engaging a solicitor or conveyancer to review the contract of sale and vendor statement will help you to understand your rights and obligations, and ensure that your interests are protected, whilst avoiding any unfavourable terms or conditions. We can assist with reviews - for details, click here.

 

Taking time for due diligence will help you make an informed decision about the property and reduce the risk of unexpected issues arising after the purchase. It is an important step in the property-buying process to ensure that the investment is sound and meets your needs and expectations.

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This article is intended as general information in summary form and does not constitute legal advice, and should not be relied upon as such. For legal advice, please contact the firm directly.

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