The Ultimate Real Estate FAQ Guide

Whether you’re planning to sell your house or buy a new one, the process can feel daunting. Real estate transactions are notoriously complicated, so it’s normal to have questions during every step of the selling or buying journey.

In this guide, we’ll answer 30 of the most common real estate questions to help you better understand the market and all of your potential options.

If you have other questions about the buying or selling process, we highly recommend connecting with a professional real estate agent. A real estate agent can answer questions based on your local market, giving you the confidence and knowledge you need to navigate the real estate process. Find an experienced real estate agent near you today!

The top 15 real estate questions to ask when selling a house

1. How do I prepare my home before I sell it?

When preparing to sell your home, the first thing to do is make it presentable. This means giving the entire house a thorough cleaning and making small repairs.

Mop the floors, scrub the bathrooms, and get rid of all the grime in the kitchen.

Little things like patching holes in the wall, changing burned-out lightbulbs, and repairing broken appliances can make your place stand out in a crowded market.

And don’t forget about paint — returning the walls to a neutral colour can help your house sell quicker. White, creams, and greys can make rooms seem bigger and help potential buyers see themselves living there.

If you’re not moving out before listing your home, you’ll also need to depersonalise and declutter.

Put away your family photos, knick-knacks, and other personal items. You may need to rent a storage unit if you don’t have a place to put them all.

2. How long will it take to sell my home?

On average, a house takes between 55 and 70 days to sell. That includes 25 days on the market and 30 to 45 days for settlement.

The exact time it takes to sell a home depends on a few things, including:

• The time of year you’re listing: Homes tend to sell faster in the spring and early fall.
• Conditions in your local housing market: Homes sell faster in a seller’s market, when there is low inventory and high demand.
• The condition of your home: Homes in great condition may sell faster than homes that need more work.
• How the buyer is financing: If a buyer needs to take out a mortgage, this may slow down the process. Financing deals usually take an average of 42 days to close, whereas cash deals take only one to two weeks.

The longer your home is on the market, the more money you lose. You’ll still have to pay your mortgage, taxes, and utilities until the buyer officially closes.

To avoid this, there are some things you can do to help your home sell faster.

You can make impactful repairs, like adding new carpet or painting the interior. However, if it’s a seller’s market and homes are selling quickly, you might not need to make these repairs.

You can also set a competitive price with the help of a top real estate agent.

Minty Real Estate’s partner agents sell homes faster than the national average with lower commission fees.

3. What should the list price of my home be?

The first step in deciding your home’s list price is to get a comparative market analysis (CMA) from a real estate agent.

To perform a CMA, your agent will find similar homes in your suburb that have the same square footage, number of bedrooms, and number of bathrooms.

They’ll see what these homes recently sold for or are listed for, and use this as a starting point for your own list price.

A great agent will be an expert in their local suburbs, so they’ll be able to price your home to sell without sacrificing your hard-earned equity. Get a free home valuation from a top local real estate agent today!

If you’re just curious and don't want to spark up a conversation with an agent, you can also use an online home value estimator to get an idea of what your home is worth.

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4. Why is my home’s assessed value different from the market value?

Your home's assessed value and market value are each determined by different factors.

Buyers and sellers affect the market value of a home, while professional appraisers calculate the assessed value.

In a seller’s market, your home’s market value may be higher than its assessed value.

That’s because buyers are willing to pay more than the home is technically worth because of low inventory.

In a buyer’s market, you’ll be facing a lot of competition from other sellers, so buyers may put in an offer lower than the home’s assessed value.

5. Are real estate commissions negotiable?

You can definitely negotiate your real estate agent's commission fees.

Some agents may be willing to work for less, especially if you use a discount broker or agent-matching service like Minty.

You can also try to negotiate fees on your own, though the real estate agent may reduce the number of services they provide.

The same goes for using a discount broker. Some offer cheaper rates because they’re providing you with less help along the way.

They may even charge you with a fee-for-service structure. This can work in your favour if you have experience in selling, but need just a little help with the paperwork.

To get cheaper commissions without sacrificing service, an agent-matching service like Minty is ideal.

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6. When is the best time to sell a home?

Early spring and summer, especially spring, is a great time to sell a home.

Research shows that home sales in September, October, November, and December account for 40% of total annual sales volume.

Home sales are still pretty good through early Autumn, so it wouldn’t be a bad idea to sell a home during this period, either.

However, home sales drop once winter hits. July is the worst time to sell a home, as market activity is much lower.

7. Should I buy a new home before selling my old one?

Whether or not you should buy a new home before selling your existing home is a personal choice.

Having a new home lined up gives you peace of mind when selling, and you can move out on your own time.

It also prevents you from lining up temporary housing (and having to move twice), which can be a pain.

That said, you may get stuck paying two mortgages at once. This can be a problem if your sale takes longer than expected.

You can also feel rushed into quickly finding a house instead of waiting for a better deal.

8. How does my agent get paid when selling a house?

Total agent fees are usually 2-4% in Australia.

As the seller, you’ll be responsible for paying your agent through your sale on settlement.

You won’t need to write a bunch of big checks or bring wads of cash to the table. This is paid during settlement.

They’ll hold money from the buyer in escrow and use it to pay everyone, including your agent.

Escrow is a third-party account where the listing agent keeps money until it’s time to be distributed.

If you want to save on commission, you can use a service like Minty to reduce the seller commission to 1.5% (incl. GST).

9. How much does a seller pay in closing costs?

Sellers typically pay about 7% of the total sale price in closing costs, including agent commissions usually between 2% to 3%. Other costs may include conveyancing fees, certificate expenses, and adjustments for council and utility rates. There are also government fees for title transfer and mortgage discharge, with specifics varying by location and sale details.

The breakdown of seller closing costs often includes agent commission (2-3%), conveyancing fees, certificate charges, and adjustments for council and utility rates. Additional costs may involve government fees for title transfer and mortgage discharge.

10. How much of the sale price do I get?

When you sell a property, the amount you receive is generally 90-92% of the sale price, accounting for costs such as agent commissions (2-3%) and various fees.

Deductions also include any outstanding mortgage and potentially some of the buyer's closing costs.

Conveyancers or solicitors manage the distribution of sale proceeds, ensuring all financial obligations are met before transferring the remaining funds to you, typically via electronic transfer.

11. How can I save money when selling a home?

The best way to save money when selling a home is to negotiate your real estate agent's fees.

If you don’t want to test your negotiating skills, you can just use Minty to get your seller agent fees down to 1.5% (incl. GST). Our large network of top-rated agents provide the same services you’d get with another agent, just cheaper.

You can also save money by trying to sell your home on your own to completely eliminate the seller commission.

But this isn’t recommended unless you have extensive experience and knowledge in the real estate industry.

That’s because selling a home involves a lot of complicated legal paperwork. An agent knows how to handle all of this so you don’t land in legal trouble.

One alternative is hiring a lawyer to take care of paperwork. However, they don't come cheap (budget about $1,000-1,500 for the service), and you’d still need to manage your listing and coordinate showings and negotiations.

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12. How does the settlement process work for selling my home?

Upon selling your home, the settlement process involves finalising the sale and transferring ownership to the buyer.

This process is managed by your conveyancer or solicitor, who ensures all legal and financial obligations are met.

Settlement typically includes paying off any existing mortgage, handling agent commissions, and adjusting rates or levies.

The final step involves the legal transfer of property, with funds distributed accordingly. This crucial phase concludes your responsibilities as the seller and finalises the transaction.

13. Do I need a building and pest inspection?

It’s the buyer’s responsibility to get a building and pest inspection, so as the seller, you don’t need to get one. An inspection usually ranges from $300–500, so that’s money you can keep in your pocket.

That said, a pre-listing inspection does have some benefits:

• You’ll have the chance to discover and take care of major problems before listing, which could increase the value of your home.
• You’ll get to choose your own inspector instead of relying on the buyer’s choice.
• You may be able to set a higher list price if your home is in great shape.
• You can encourage the buyer to waive the inspection contingency, meaning there will be fewer chances for your deal to fall through.

14. What should I know about home condition requirements for loan approval?

Before loan approval, banks often conduct property valuations to ensure the mortgage is supported by the home's value.

This process can identify necessary repairs impacting the property's worth, such as structural damages or safety issues. Addressing these concerns is crucial for meeting lender requirements and securing financing.

15. How can a real estate agent help me sell a home?

A real estate agent has an in-depth knowledge of the area and how your home compares to others on the market.

They’ll have a good idea of how much you can get for your home and ways you can improve its value.

When it’s time to list, they’ll make sure your home’s priced just right, helping to maximise your offers and sell your home faster. They’ll also take care of all the paperwork, market your home, and coordinate open houses.

Real estate agents aren’t just helpful during the listing process, though. They offer a network of professionals throughout the entire selling journey.

You’ll have connections for everyone you need, whether that’s a conveyancer or quality listing photographer.

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The top 15 real estate questions to ask when buying a home

1. What is the first step for buying a home?

Before you can purchase a home, you’ll need to check your credit score. Potential buyers with credit scores of 700 or higher reassure lenders that they can be trusted to repay the loan.

High scores reflect consistent on-time payments, long-term borrowing experience, and a good mix of credit types (student loans, car loans, credit cards, etc.).

Lenders look at these factors to determine if you qualify for certain kinds of mortgages, so be sure to review your credit history and correct any errors. This will give you a better chance at qualifying for loans with lower interest rates.

Shop around for different mortgage lenders to find out what kind of loans you prequalify for before beginning your home search. With this knowledge, you can easily create a budget and start looking for homes within that range.

2. How long will it take to buy a home?

In 2019, it took buyers an average of 4.5 months to choose a home and make an offer. The buying process itself, which begins when an offer is accepted, takes about 30-45 days to finalise.

However, several factors can affect the buying process, including the property’s location, buyer demand, economic trends, and other variables. Before closing, you’ll also need to::

• Order a home inspection / building and pest
• Get an appraisal
• Conduct a title search
• Finalise mortgage details
• Review settlement documents

To speed up the home buying process, connect with a top real estate agent in your suburb. A knowledgeable agent can help you narrow down your options and negotiate with sellers on your behalf.

3. Can I back out of buying a house?

In Australia, withdrawing from a property purchase is possible but might come with financial losses, such as forfeiting the initial deposit paid to the seller. Legal consequences may also arise if the contract's terms are breached.

Valid reasons like financing issues, failing to sell your current home, job loss, or significant undisclosed defects discovered during property inspection could justify contract termination.

Always consult the purchase agreement for specific conditions and seek legal advice when considering backing out of a home purchase.

4. Are real estate prices negotiable?

Yes! You just need a good understanding of the current market and the seller’s needs and motivations.

When the real estate market is a seller’s market, for instance, homes are in high demand and will likely receive multiple offers. Lowballing an offer in this case might cause you to lose your chance at your dream home.

Early in 2021, for instance, the median house price in Sydney was around AUD 1.3 million, which underscores the importance of negotiation skills.If this number discourages you, learning how to negotiate is key. Tactful negotiation with a seller can help you afford a home you love instead of settling for an option under budget.

Consulting a real estate agent is your best bet if you want to make sure your offer won’t be rejected or ignored. Their knowledge of the local market and buyer demand will help you and the seller negotiate a fairer price.

Whether or not you use an agent, wait until after the home inspection before you try to negotiate a lower price. If the inspector finds any issues, you can ask either for a reduced price or for the problems to be fixed prior to closing.

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5. When is the best time to buy a home?

It depends whether you’re searching for the lowest prices or the greatest variety of options. Here's some seasonal data:

1. Spring: High activity with more listings but also higher competition, potentially increasing prices.
2. Summer: Opportunities before Christmas as sellers aim to close deals, potentially allowing for negotiations.
3. Autumn: Active market post-summer research with a chance for negotiation before Easter.
4. Winter: Fewer listings but also less competition, which could lead to better deals.

Each state and suburb has unique dynamics affecting the best time to buy. Factors like investor activity and seller motivations play a role. Regardless of the season, buyers should research local trends and assess their financial readiness before making a purchase​ (Canstar)​​ (Doorsteps - Real Estate Reimagined)​.

6. Should I sell my home before buying a new one?

It depends how far along you are in your home search process. If you sell your home before you’ve narrowed down your options, you might be forced to find a short-term rental or stay with friends or family. In either case, remember that this means you’ll be forced to move twice or pay for a storage unit.

On the other hand, selling your home first can give you a significant advantage over other potential buyers.

If you find a listing you really love, you can make a strong offer with the cash you made from the sale without worrying about going over your budget.

Furthermore, since you won’t feel rushed to accept an offer on your own home, you can wait until someone makes an offer you like.

7. How Does My Agent Get Paid When Buying a House in Australia?

In Australia, the real estate agent's commission is typically covered by the seller, not the buyer. This commission is agreed upon in the contract between the seller and their listing agent and is only paid upon the successful sale of the property. In Australia, commission rates vary by state and the complexity of the sale, but generally range from 1.5% to 4% of the sale price.

The commission covers the work done by the selling agent throughout the listing and sale process, including marketing the property, conducting open homes, negotiating with buyers, and finalising the sale. Buyer's agents, if used by the buyer, typically operate on a fee-for-service basis or charge a percentage of the property purchase price, which is paid directly by the buyer for their services in finding and negotiating the purchase of a property.

For example, if a property sells for $500,000 with a 2% commission rate, the total commission would be $10,000, paid by the seller to their agent upon the completion of the sale. If a buyer's agent is involved, their fees would be arranged separately and directly with the buyer, not taken from the sale commission.

It’s important for buyers and sellers to discuss and understand all fees and commissions before entering into any agreements with real estate agents or brokers.

8. How much does a buyer pay in settlement costs?

When purchasing a property in Australia, buyers encounter various closing costs in addition to the purchase price. These expenses cover the legal, administrative, and financial aspects of finalising a property transaction. Here's a breakdown of typical closing costs a buyer might pay:

• Stamp Duty: A significant cost, varying by state or territory, based on the purchase price and buyer type (e.g., first-home buyers may receive concessions).
• Conveyancing Fees: Charges for the legal work required to transfer property ownership, typically ranging from $1,000 to $2,500.
• Loan Establishment Fees: Some lenders charge an upfront fee for setting up a mortgage, which can be around $600 or more.
• Lenders Mortgage Insurance (LMI): Applicable if you borrow more than 80% of the property's value, the cost varies widely depending on the loan amount and deposit size.
• Building and Pest Inspection: Pre-purchase inspections are crucial for identifying any potential issues, usually costing between $400 and $600.
• Bank Valuation Fee: Charged by lenders to assess the property's value, if not included as part of the loan application fee, typically around $200 to $500.
• Mortgage Registration Fee: A government charge for registering your mortgage, varying by state, generally around $100 to $150.
• Transfer Fee: A state government charge for transferring the property title, costing between $100 and $1,000, depending on the property value and location.

Closing costs can range from 3% to 5% of the purchase price, but this can vary based on the specifics of the transaction and any concessions or exemptions you may qualify for. It’s advisable to budget for these costs early in the buying process to avoid any surprises at settlement.

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9. How can I save money when buying a home?

In Australia, there are several strategies and programs designed to help homebuyers, especially first-timers, save money when purchasing a property. Exploring eligibility for government incentives, grants, and schemes is a great starting point.

First Home Owner Grant (FHOG): This nationwide grant is designed to help first-home buyers with their purchase. The details and amounts can vary by state or territory, but it generally provides a one-off payment to assist with buying a new home or building one.

Stamp Duty Concessions: Many Australian states offer stamp duty concessions or exemptions for first-home buyers, which can significantly reduce the cost of purchasing a property. The criteria and benefits vary, so it's worth investigating what's available in your state or territory.

First Home Loan Deposit Scheme (FHLDS): This initiative allows first-home buyers to purchase a home with as little as a 5% deposit without needing to pay for Lenders Mortgage Insurance (LMI). The government essentially guarantees the remainder of the deposit to the lender.

Lenders Mortgage Insurance (LMI): While typically seen as an additional cost, understanding LMI can also offer a pathway to homeownership sooner than later. If you're able to purchase a home with a smaller deposit, you might decide that paying LMI is worth it to enter the property market earlier, despite it adding to the cost of your loan.

Saving a Larger Deposit: Similar to advice in other countries, saving a 20% deposit can save you thousands over the life of your loan by avoiding the cost of LMI (unless you're eligible for the FHLDS or similar programs).

Government Schemes: Keep an eye out for other state-specific schemes and incentives, such as shared equity schemes, that can help reduce the upfront and ongoing costs of buying a home.

Negotiating Agent Fees: There's still room to discuss the possibility of a commission rebate with your real estate agent, especially if you're selling one property and buying another with the same agent.

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10. What is a holding deposit?

A holding deposit is a preliminary payment made by a buyer to show commitment to a property purchase in Australia. This small but significant amount, usually around 0.25% to 1% of the property's purchase price, secures the buyer's interest in the property and temporarily removes it from the market.

Key Points:

• Security: Provides assurance to the seller about the buyer's serious intent.
• Refundable: Typically returned or credited to the buyer upon contract completion, subject to terms.
• Immediate: Paid when making an offer, prior to the exchange of contracts.

A holding deposit demonstrates a buyer's earnest interest in proceeding with the purchase and is held in a trust until the sale progresses further. For more details on navigating your property purchase, visit our guides and resources.

11. What is conveyancing, and why is it important when buying a house in Australia?

Conveyancing is the legal process of transferring property ownership from the seller to the buyer. It's a critical step in the home buying process in Australia, involving several stages:

• Legal Checks: A conveyancer or solicitor conducts searches and checks to ensure there are no legal issues with the property's title, such as outstanding debts, zoning restrictions, or other encumbrances that could affect your use of the property.
• Contract of Sale: The conveyancer reviews the contract of sale, negotiates terms with the seller's legal representative, and ensures that all conditions are met before proceeding.
• Settlement: This is the final step where the property's ownership is officially transferred to the buyer, and financial transactions are completed. Your conveyancer coordinates this process, ensuring all legal and financial obligations are fulfilled.

Conveyancing is vital because it ensures that the property you buy is legally transferred to you without any unresolved issues that could impact your ownership or enjoyment of the property. It's advisable to hire a professional conveyancer or solicitor to navigate this complex process, ensuring a smooth and legally sound transaction.

12. What should my down payment be on a house?

In Australia, aiming for a 20% down payment is ideal to bypass Lenders Mortgage Insurance (LMI), yet many lenders typically ask for a minimum of 5%.

For first-home buyers or those qualifying for specific schemes, a down payment could be as low as 2% or 5% through programs like the First Home Loan Deposit Scheme (FHLDS).

Some initiatives even support buying with no down payment for eligible groups.

13. How long can the seller take to respond to my offer?

Sellers generally have about 72 hours to respond to an offer, but this may vary by state. If a bank is selling a home, on the other hand, the response can take several days or weeks.

If you make an offer and the seller doesn’t respond at all, your offer was probably too low. To increase the likelihood that your offer will be accepted, a local real estate agent can help you strike the right balance between a reasonable cost for you and an appealing price for the seller.

14. Why do I need a mortgage before I buy a house?

If you can get pre-approved for a loan, it can help speed up the underwriting and buying processes, getting you into your new home sooner.

During the underwriting process, loan underwriters will review the "3 Cs:"

• Your credit history
• Your capability to repay the loan
• Collateral

If you have a positive history of making payments on time, a good credit score, and a consistent income, the turnaround time can take just a few days.

Once a lender approves your loan application, you will be "clear to close." After this, your agent will have you sign closing documents, pay the down payment, and transfer the home’s title to you!

15. How can a real estate agent help me buy a home?

A buyer’s agent can help you find homes within your budget, schedule visits to houses you like, and negotiate with sellers. Top real estate agents have in-depth knowledge about your area and can save you time and money by narrowing down your best possible options.

Real estate agents also have access to the multiple listing service (MLS) database, which can help you find homes in popular locations before other buyers. Since real estate agent's are plugged into the local market, they might even hear about potential properties before they’re officially listed!

Buying a home can seem overwhelming and confusing, but an experienced real estate agent can put your mind at ease. Minty can connect you with some of the best local agents at reduced rates to help you find the perfect home without breaking the bank.

Buy or sell your home with confidence

Now that you’ve gotten answers to some of the top real estate questions for sellers and buyers, you should feel more prepared to face the real estate market.

Being armed with this knowledge can help you negotiate a better price for your home and enjoy a smooth buying or selling experience.