Buying an apartment
How to buy an apartment
I'm sorry to inform you that the perfect apartment doesn't exist. In this knowledge I suggest you search for the best apartment in your price range. Make a list of what you desire and when you find the apartment that ticks 80% of the boxes - buy it without hesitation and enjoy the celebration!
Before buying an apartment the best thing you can do is research the market. Check recent sales in the area and research selling prices.
The buying process
1. Go to Bank - Get pre-approval. Some banks will require a higher deposit than others. Visit a few banks to discuss your options.
2. Get a lawyer if you don't already have one. You are looking for a lawyer that speaks plain English and doesn't charge the earth for his/her services. Never be afraid to ask questions if you don't understand something they say. It is their job to help you understand the buying process.
3. Start your search for an apartment. Check out Apartment websites like this one, local papers, real estate companies, supermarket boards etc.
4. Don't be in a rush. View lots of apartments. Compare apartments (value for money etc). Be aware of additional costs like Body Corporate Fees (some are well over $4,000 p.a.)
5. Make an offer. Make it conditional on bank approval. lawyer's approval, building inspection and LIM report especially if you are a first time buyer.
Check out the building construction and location.
Is there an active body corporate? Find out what body corporate fees you would be expected to pay and ask about the body corporate rules. Do they have a long term maintenance fund?
Ask for the last AGM minutes as this will give you an indication of how the apartment complex is being managed.
Is there a permanent building manager on-site?
Find out about the neighbours and decide if noise could be a problem.
Are most of the apartments rented - with a constantly changing parade of neighbours? Would this bother you?
How close is the building to shops, cafes, nightclubs and other amenities? Is this going to impact on noise, for example is the building in the main nightlife area of town? Invariably, the nature of apartment living means there will be some noise you have to contend with.
Is there car parking and do you have to pay extra for it?
What security measures are in place, for example, can anyone walk into the building? Are there any security cameras?
Do you have a view and sunlight, or are you blocked by other buildings or facing the wrong way for the sun?
Find out if there are any pending resource consents that will affect your apartment block, for example, plans to build a high-rise hotel next door.
Does it have a balcony so you can enjoy the view or afternoon sunshine?
What other facilities, such as a gym and swimming pool are in the complex? This may or may not be important to you.
Is the lift system reliable and are there enough lifts to cope with the flow of people at busy times? How easy will it be to get your furniture in and out of the building?
Talk to other people who already live in an apartment complex and ask them what they think about living there.
Does the apartment need any major refurbishments in the near future (kitchens and bathrooms).
Make sure the apartment is suitable for what you want. For example if you want to work from home can you operate a small business in it? Can your cat live there? It pays to have the answers to these questions before you buy!
When doing your sums make sure you factor in your outgoings! Normal monthly costs will include your telephone, power/gas and contents insurance. You will almost have your annual council rates and body corporate charges. All apartments are levied annually by the council based on a three yearly council valuation just like houses. Plus, your body corp fees (your share of the total cost of running and maintaining the whole complex). If your apartment is on leasehold land there may also be an annual ground rent to pay.
Look to the future. Remember a quality apartment in a prime location will always be a good investment.
If your apartment is a rental investment make sure it will attract the tenants you desire and will put a smile on your accountant's face (make a profit after all expences).