First home buyer checklist for NSW

Buying your first home in NSW comes down to four things: knowing what you can afford and what help you're entitled to, checking the property properly before you sign, getting the contract reviewed, and knowing what happens between exchange and settlement. This checklist takes you through each step, in order, with what to check and who to ask.

1. Know your budget and the help you can get

• Get pre-approval from a lender or mortgage broker, so you know your limit before you start bidding
• Work out the full cost, not just the price: stamp duty (transfer duty), conveyancing, inspections, the strata report, loan fees, moving costs and, for apartments, the first levies
• Check the NSW First Home Buyers Assistance Scheme. For contracts exchanged on or after 1 July 2023, eligible first home buyers pay no transfer duty on a home valued up to $800,000, and a reduced rate on homes valued above $800,000 and below $1 million. Vacant land has its own lower thresholds
• Check the residence rule. To keep the exemption or concession, you must move in within 12 months of settlement and live there for at least 12 months in a row
• Ask about the Australian Government's 5% Deposit Scheme, which can let you buy with a smaller deposit without paying lenders mortgage insurance. Price caps and lender rules apply, so check the current details with your broker
• Ask about the First Home Owner Grant if you're buying or building a new home. It doesn't apply to existing homes

Check the current rules on the Revenue NSW website before you rely on them. Thresholds change.

2. Check the area before you fall for the property

• What can be built next door. Zoning and the NSW Low and Mid-Rise Housing rules can allow terraces or apartment blocks near stations and town centres. See our guide to development applications near a property
• Flood and bush fire risk. Check the planning certificate in the contract, council flood maps, and bush fire prone land maps
• Noise. Flight paths, rail lines, main roads and licensed venues
• Getting around. Visit at the times you'd commute, and on a weekend night

3. Check the property itself

• Building and pest inspection. Book it early. Read the defects and the list of areas not inspected. See what it costs in Sydney
• Unapproved building work. Extensions, decks, bathrooms and garage conversions without council approval can be costly. See our guide to unapproved building work
• For apartments, the strata report. The funds, special levies, defects, disputes, insurance and by-laws. See our strata report review guide
• If it's tenanted, the lease, rent and bond. See buying a tenanted property

4. Get the contract reviewed before you sign

• Use a solicitor or conveyancer to review the contract before you exchange or bid at auction
• Read the special conditions. They often change the standard terms in the seller's favour. See contract special conditions in NSW
• Check what's included: fixtures, inclusions, and anything the seller is taking
• Check the settlement date works with your lender and your current lease

5. Exchange and the cooling-off period

• Private sales usually have a 5 business day cooling-off period after exchange. Pulling out in that time costs 0.25% of the price
• Auctions have no cooling-off period. Everything must be checked before auction day
• A 66W certificate waives the cooling-off period. Only sign one once all your checks are done. See the cooling-off period and 66W certificate
• Pay the deposit as the contract requires, usually 10%, unless a smaller deposit has been agreed

6. Before settlement

• Arrange insurance. For a house, you may need cover from exchange, depending on the contract. For an apartment, the owners corporation insures the building, but you'll want contents cover
• Final inspection. Check the property is in the condition it was when you signed, and that included items are still there
• Your conveyancer orders the strata certificate for apartments, so levies are split correctly at settlement
• Confirm your lender is ready, and the funds for the balance and costs are in place

Questions to ask before you sign

• Is there any development planned or allowed next door?
• Is the property affected by flood, bush fire or other hazards?
• Has all the building work been approved?
• For apartments: are any special levies raised, proposed or deferred? Is the capital works fund enough for the work ahead?
• What do the special conditions in the contract change?

Questions

Do I need a solicitor or a conveyancer?

Either can handle the contract and settlement in NSW. A solicitor can also give legal advice if something goes wrong. For a complicated contract or property, many buyers prefer a solicitor.

How long does it take from exchange to settlement?

Usually six weeks in NSW, though it can be shorter or longer if agreed in the contract.

Can I pull out after exchange?

During the cooling-off period on a private sale, yes, for 0.25% of the price. After that, or at auction, pulling out usually means losing your deposit, so do every check before you sign.

Keep reading

• Buying a tenanted property in NSW: what to check
• What to look out for when buying a property in NSW
• Property due diligence in NSW: the full checklist
• NSW cooling-off period and 66W certificate

General information only, not legal, financial or building advice. See our Terms of use.