Buying a Home in Sydney?

Buying your first home is the biggest financial decision most people will ever make, and in NSW the process has its own rhythm. This guide walks you through the whole journey, in the order you'll live it.

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What we'll cover:

1. Finance first - why pre-approval comes before house-hunting, and the costs nobody warns you about.
2. Inspecting a property - what to actually look at when you walk through a home open.
3. Questions to ask the agent - and what the answers are really telling you.
4. How offers work in NSW - the Offer and Acceptance process.
5. Important claues explained - what each condition in your contract means, in plain English.
6. From acceptance to settlement - what happens in those final weeks.

Skip ahead to the stage you are at!

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Step 1: Finance First

Walking into home opens without pre-approval is like shopping without knowing what's in your wallet. Worse, in a market where good properties move fast, an offer without finance behind it is the first one a seller discards.

Pre-approval (also called conditional approval) means a lender has assessed your income, expenses, deposit and credit history, and agreed in principle to lend you a certain amount. It's usually valid for around 90 days and can be refreshed.

Two things first-home buyers routinely misunderstand:

• Pre-approval is not a guarantee. It's still subject to the lender valuing the specific property you buy and re-checking your circumstances. If your job or debts change between pre-approval and settlement, so can the answer.
• The bank's maximum is not your budget. What you can borrow and what you should borrow are different numbers. Build in room for rate movements.

Budget for the costs beyond the deposit. These catch people out constantly:

• Transfer duty (stamp duty)
• Lenders Mortgage Insurance, if your deposit is under 20% and you're not using a guarantee scheme
• Conveyancer fees
• Building and timber pest inspections
• Council and water rates adjustments (you reimburse the seller for the portion after settlement)
• Home and contents insurance — arrange this from the day the contract goes unconditional, not settlement day
• Moving, connections, and the inevitable "the fridge doesn't fit" purchases

Broker tip: Get pre-approved before you start looking seriously. It sharpens your search, strengthens your offer, and means you can move quickly when the right place comes up.

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Step 2: Inspection Time (10-point check)

Home opens are staged to make you feel something. Fresh paint, a diffuser, a bowl of lemons on the bench. Your job is to look past the styling, examining the bones of the house. Work through this list at every property. It's our our 10-point check system...

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1. ‍Structure - cracking in walls / cornices / flooring, sagging or bowec ceilings, floors feel uneven, doors that don't sit square. Outside check the roof, gutters and eaves.
2. Water Damage - skirting boards in kitchens, laundy room, bathroom and entryways for swelling or staining. Bubbling paint, a musty smell or a room that's been aggressively air-freshened all deserves a second look.
3. Plumbing and hot water - Run the taps, check pressure, flush the toilets, and time how long hot water takes to arrive. Look under sinks for leaks or recent patch-ups. Note the age and type of the hot water system (replacing a system can be expensive).
4. ‍Electrical - Look at the switchboard for RCDs (safety switches). ‍
5. Cabinetry and fixtures - Open every cupboard, drawer and wardrobe. Check they close properly. Look at the condition of benchtops, tapware and door handles.‍
6. Pests - Termite activity, mud tubes along skirtings or piers, hollow-sounding timber. You won't diagnose this yourself, that's what a timber pest inspection is for, but you can spot the warning signs.‍
7. Storage and layout - Where do the pots, linen, towels, tools and Christmas decorations go? Is there a spot for the bins? Does the layout suit how you actually live, or how you imagine you might?‍
8. Orientation and light - North-facing living areas are worth real money in Perth. So is shade in the right places. A west-facing living room with no eaves will cost you in cooling for as long as you own it.‍
9. Surroundings - Come back at different times, a weekday morning, a Friday night, a Sunday. Traffic, flight paths, neighbouring pets, and what the street feels like after dark are things a Saturday home open won't tell you.‍
10. Future costs - Roof condition, air conditioning age, whether NBN is connected, hot water system age, reticulation, fencing, and.. if it's a strata property... the levies and the state of the reserve fund.

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Step 3: Smart questions to ask the agent

The agent works for the seller. That doesn't mean they'll mislead you, but it does mean they're not volunteering weaknesses. Good questions do the work for you.‍

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"Why is the owner selling?"

‍This tells you what the seller values. Someone who's already bought elsewhere may care more about a quick, clean settlement than squeezing out the last $5,000. That's leverage that costs you nothing.

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"How long has it been on the market?"

‍A property that's been listed for months is either overpriced or has a problem. Either way, it's an opening.

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"Have there been other offers? How many buyers have shown interest?"

‍Agents aren't obliged to tell you the numbers, and often won't. But the way they answer tells you plenty about whether you're competing.

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"Are there any known issues — structural, termite, asbestos, flooding, or unapproved works?"

‍Ask directly and, ideally, in writing. Some sellers have inspection reports already prepared.

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"Were any renovations or extensions council-approved?"

‍This one genuinely matters. Unapproved structures can create insurance problems, finance problems and resale problems. A patio or granny flat without approval becomes your legal headache the day you settle.

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"What's the seller's price expectation, and what have comparable homes nearby sold for?"

‍Then verify it independently. Recent sold prices in the immediate area are the only real anchor.

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"What are the council rates, water rates, and strata levies?"

‍These are ongoing costs that affect your borrowing capacity and your monthly budget.

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"What are the seller's preferred settlement terms?"

‍Sometimes matching their timing is worth more to them than more money.

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Step 4: How to make an offer in NSW

Here's where NSW genuinely differs, and where first-home buyers get caught out.

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The process

1. ‍Have your pre-approval ready. Not "I've spoken to a bank." Actual pre-approval.
2. Ensure property meets finance conditions. Check your pre-approval or ask your broker, don't guess!.
3. Negotiate price and terms with the agent. Usually informal - a call, an email, a written offer form the agency uses. Nothing here is binding on either side yet.
4. Your solicitor reviews and negotiates the contract. The standard NSW contract doesn't automatically include a 'subject to finance' or 'subject to building and pest inspection' clause. If you want one, this is where your solicitor negotiates it in as a special condition.
5. Exchange contracts. You and the seller each sign a copy, the copies are swapped (often electronically via your solicitors), and you pay a deposit - usually 2-10%, held in a trust account. This is the moment the sale becomes legally binding in NSW.
6. Cooling-off period runs , unless it doesn't. From exchange, if negotiated you may have 5 business days to walk away for any reason, forfeiting 0.25% of the price. It doesn't apply if you bought at auction, exchanged later on auction day after a pass-in, exercised an option, or your solicitor signed a Section 66W certificate waiving it at exchange... something agents often push for in competitive situations. Never sign a 66W without advice.

The deposit

The deposit is paid into the selling agency's trust account, never directly to the seller. It's held there and counts toward your purchase price at settlement.

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Amounts vary. You'll often see figures around $5,000 to $20,000, and some sellers ask for a percentage. It's negotiable, and as a buyer, less upfront is generally better for your cash flow. A larger deposit can signal seriousness in a competitive situation, but it shouldn't be the thing you're competing on. The initial deposit offer doesn't necessarily dictate your loan-to-value ratio. Meaning, if you were borrowing 80% to buy the property from the bank, your initial deposit doesn't need to be 20%, you can list 1%. The remaining deposit will be deducted when your formally settle / purchase the property.

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If you're bidding at auction

Auction purchases in NSW are unconditional. No finance clause. No inspection clause. No cooling-off. If your hand goes up and the hammer falls, you own it.

Only bid at auction if you have conditonal finance approval, you've already had your inspections done, and you've had the contract reviewed.

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Step 5: Your contract clauses, explained

This is the part that matters most, and the part most first-home buyers skim. Your Conveyancer is your best friend when it comes to clauses - so ask them away, as they are the professionals. But to give you an idea of what you can expect, here are some regular clauses that we see...

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Note: The explanations below are simplified summaries, not legal advice. Clause wording and effect vary between contracts.

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Finance clause ("subject to finance")

What it is: Your contract only proceeds if your lender formally approves the loan for this specific property by a nominated date. You'll name the lender and the approval deadline, typically 14 to 28 days from acceptance however consult your broker.

Why you want it: Without it, you're contractually obliged to buy a house you may not be able to fund. That's a deposit you can lose, and potentially far worse. This is also your saving grace to have the deposit refunded if finance fails (in most situations).

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Building / Timber pest (Terminte) and structural inspection clause

What it is: The right to have a qualified inspector assess the property, and to withdraw or renegotiate if significant defects are found. You pay for the inspection.

Why you want it: You get a professional's view of the roof, structure, drainage and everything you couldn't assess in a 30-minute home open — before you're locked in.

Watch out for: The wording. A clause that only lets you exit for "major structural defects" is much narrower than one that lets you exit if the report isn't satisfactory to you. Book your inspector immediately after acceptance — inspection windows are short.

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Electrical safety clause (RCDs and smoke alarms)

What it is: A condition requiring the seller to provide evidence that compliant RCDs and mains-powered smoke alarms are installed.

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Good working order clause

What it is: A condition that specified items — oven, cooktop, dishwasher, air conditioning, hot water system, reticulation, garage door, pool equipment — are in working order at settlement.

Why you want it: It gives you grounds to have things fixed if they've failed between your offer and handover, and it's what makes your final inspection meaningful.

Watch out for: Be specific. List the items by name. "Appliances in good working order" invites argument; "oven, dishwasher, ducted reverse-cycle air conditioning and reticulation controller in good working order" doesn't. Note that "working order" means it functions, not that it's new.

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Settlement date

What it is: The day the money moves, the title transfers, and you get the keys.

Why it matters: It drives everything — when your loan documents need to be signed, when your finance must be unconditional, when your lease ends, when you book removalists.

Typical timing: Around 45 days from acceptance is common, which usually allows about 21 to 28 days after finance approval for the paperwork. Longer settlements (60 to 90 days, occasionally more) can be negotiated if you need time to sell, save, or move. Auction purchases typically settle around 30 days from the auction date.

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Deposit clause

What it is: How much you pay, when, and where it's held. Deposits to the agents can be negotiated. Most clients offer $10k-$50k or a percentage.

Watch out for: Confirm the funds go to a licensed agent's or settlement agent's trust account, and be alert to payment-redirection scams — always verify trust account details by phone with a number you've independently confirmed, never from an email alone.

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"Subject to sale" clause

What it is: Your purchase depends on you selling your current home first.

Why you'd use it: It protects you from owning two properties and two loans at once.

Watch out for: It weakens your offer significantly, because the seller is taking on your risk. Sellers frequently reject these or accept them with a "48-hour clause" that lets them keep marketing and force you to either go unconditional or step aside if a better offer arrives. Less relevant for most first-home buyers, but worth understanding if you're buying with a partner who already owns.

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Repairs and specific works

What it is: A condition requiring the seller to fix identified problems before settlement — usually negotiated after your inspection reports come back.

Watch out for: Vague wording is worthless. Specify what's being repaired, to what standard, by whom, and by when. Where possible, require receipts or a licensed tradesperson's certificate. As an alternative, you can negotiate a price reduction and manage the repairs yourself — sometimes cleaner, and you control the quality.

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Inclusions and exclusions

What it is: The list of what stays with the property and what the seller takes.

Why you want it: The legal default is that fixtures (things attached to the property) stay and chattels (loose items) go — but the line between them causes more disputes than almost anything else. Dishwashers, wall-mounted TV brackets, pot plants in built-in beds, garden sheds, curtains, blinds, solar panels, pool robots.

Watch out for: Write down anything you're assuming will be there. If you fell in love with the outdoor kitchen or the ducted vacuum, name it in the contract. "It was there at the home open" is not a legal argument.

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Professional cleaning clause

What it is: A requirement that the property be professionally cleaned before settlement — commonly carpets steam-cleaned and window treatments cleaned, with receipts provided.

Why you want it: You're moving into someone else's home. This sets a standard rather than leaving it to their discretion, and the receipt is your proof.

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Strata clause (apartments, villas, townhouses)

What it is: A condition allowing you to review the strata documents and withdraw if you're not satisfied.

Why you want it: Strata paperwork tells you the levies, what's in the reserve fund, whether major works are planned, whether there's a dispute or a special levy coming, and what the by-laws let you do — pets, renovations, parking, short-stay letting.

Watch out for: Ask for the strata company information certificate, recent meeting minutes and the financial statements. A low purchase price with a poorly funded reserve fund and an ageing building can mean a large special levy landing on your doorstep.

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Final (pre-settlement) inspection

What it is: Your right to walk through the property shortly before settlement to confirm it's in the same condition as when you offered, that included items are still there, and that agreed repairs are done.

Why it matters: It's your last practical checkpoint. Bring your phone charger to test power points, run the taps, turn on the air conditioning, test the oven and the garage door, and check the items on your inclusions list are physically present.

Watch out for: Book it in with the agent well ahead of time, and raise any issues immediately through your settlement agent — not after you've collected the keys.

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Step 6: From acceptance to settlement

Here's roughly how the final stretch runs:

1. Offer accepted — you're in a binding contract, subject to your conditions.
2. Deposit paid into the trust account.
3. Appoint your settlement agent or conveyancer and give them a copy of the contract.
4. Inspections booked and completed within your condition timeframes.
5. Finance formally approved — your broker handles the lender, valuation and any conditions.
6. Any issues negotiated — repairs, price adjustments, or withdrawal if something serious surfaces.
7. Contract goes unconditional — all conditions satisfied.
8. Loan documents signed and returned
9. Arrange building insurance — do this prior, not on settlement day.
10. Final inspection
11. Settlement — funds transfer, title changes hands, and the agent releases the keys

Keep an eye on your condition dates throughout. Missing a deadline can mean losing the protection that clause gave you — a diarised reminder a few days ahead of each one is cheap insurance. Good luck & happy house hunting.

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This guide is general information only and doesn't take your personal circumstances into account. Legislation, duty thresholds and grant eligibility change; confirm current figures with NSW Revenue and get advice specific to your situation from a licensed property lawyer, settlement agent and finance broker before acting.

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