If you love the home you rent and don’t want to move, making an offer to buy it from your landlord when you’re ready to make the leap from tenant to homeowner might be a viable option.
Tenants buying their rental property is actually more common than many people think, especially amongst families who have been renting their home for a while and have settled into the area. It means no need to change the familiar routines, switch the kids to another school and move them away from their friends etc. There’s also no need to go through the stress, costs and hard work of moving. Another positive is that you already have a rental history and an existing relationship with the managing agent. But what if the property is not listed for sale? How do you make the first move?
Get an idea of the market value first
The best place to start is to do some research to give you an idea of the value of the property you are renting. You could arrange a valuation from an independent valuation firm or study recent sales results in the area and similar properties for sale to gauge the level of supply. You should also seek finance approval, at least pre-approval, to ensure you have the means to purchase the property.
Before you make an offer, have a look at what else is available within your price range to ensure you aren’t missing out on the home of your dreams by settling for the home you are renting. Of course, if you love where you live and feel no need to look elsewhere, then you know you can be certain you are making the right decision. Make sure also that you are ready to make the leap to home ownership, factoring all the additional costs you will be up for into it, such as council and water rates, strata levies and home insurance.
Contact the property manager
Once you have a good idea of the current market value, contact the managing agent and let them know you would like them to ask the owner if they are interested in selling. Let the agent know you are ready to make an offer if the owner is open to receiving it.
The property manager will then speak to the owner and, if there is interest in receiving your offer, will likely put you in touch with a sales agent from the office.
Make an offer in writing
To let the owner know you are serious, put your offer in writing and confirm that you have finance approved. If you are pre-approved for finance, your offer will be subject to finance approval. It’s also wise to make your offer subject to a satisfactory building and pest inspection.
See a conveyancer once your offer has been approved and the contract is ready
It is good practice to have a conveyancer review the sale contract before you sign it and exchange.
So, if you’re ready to transition to home ownership and the home you currently rent ticks all the boxes, take the opportunity to ask if the owner if there is interest in selling to you. The worst thing that could happen is that they say no.