The extra mile buyers should go when shortlisting a property – Inspecting like an expert & how to spot red flags, all you can discover for free online, assessing a floorplan, finding nearby developments, and more! (Ep.165)


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In this week’s episode, Dave, Cate and Pete take you through:

  1. Listener Question: “A glass half full question … as we transition into a Buyer’s market, what steps can investors take to be positioned to take advantage of an opportunity that might present itself” 

The trio start the episode by answering a question from a podcast listener and share their tips on how to get purchase ready, to strike when the iron is hot!  Property is a long game and we do need to sometimes remind ourselves of this. 

  1. What are some of the things we can check online before we even book an inspection?

The trio share their hot tips on how to make the most of your internet searches when doing your online research.   

  1. What things should you be looking out for immediately when inspecting in person?

Cate shares with our listeners what to look out for when you visit an open house. Take note, listeners should use more than just their eyes when inspecting the dwelling! Pete shares the aspects of the land to keep an eye out for and why you should stick around for the whole inspection.   

  1. How to assess a ‘workable’ floorplan vs a complete overhaul floorplan

An illogical floorplan can be a huge pain, not to mention the financial commitment if you want to make adjustments. The trio discuss how to assess the floorplan, which could save you thousands on a planned renovation. However, the floorplan is not everything. For listeners who want to get into a particular location, especially first-time buyers, dealing with a less than ideal floorplan or a more run-down house could be the trade off to get into the best location. 

  1. What kind of renovation are you planning?

What is the difference between cosmetic work, work that requires tradies and work that needs a planning permit? It’s important to be clear on what type of renovation you’re going to be doing. And just as importantly, when you are inspecting a property, what work has been done? …and should there be certificates of compliance included in the contract of sale? If you do notice that renovations have been completed, bring them to the attention of your solicitor or conveyancer as they may have been done illegally!  

  1. What you can find out from council about the land or dwelling

The trio discuss the information that you can find out from the council, and the encumbrances that could have a significant impact on your intended use of the land. Pete shares a hot tip on how you can stay abreast of any planned development in the area.  

  1. Obtaining insurance quotes

Do a quote online on the property you intend to purchase. Although it’s not considered to be thorough research, the quote will give you a good indication of whether there could be a problem with the location in terms of flood or fire if the quote comes back higher than normal.   


Show notes

  1. Listener Question: “A glass half full question … as we transition into a Buyer’s market, what steps can investors take to be positioned to take advantage of an opportunity that might present itself

It’s a short answer – buyers should accept when the buying conditions are good and the property is A grade and be prepared to buy it. Too many lose out when they are angling for a bargain, and they either wait, wait, wait until the opportunity of timing the bottom of the market has passed, or they buy a bad bag of apples for a super low price. 

Market is going down because interest rates are up and borrowing capacity is tighter, but that means that you are also in that position.  

Look at where you can cut back your expenses.  

Don’t be sitting on the side lines. By the time you’re ready to move it’s 6 months later, make sure that you’re ready and if you want to time towards close to the bottom of the market, make sure that you’re ready to go so you can buy the next day if that’s really what you’re aiming to do.  

  1. What are some of the things we can check online before we even book an inspection?

Check street view to make sure it’s not near anything untoward – school or something you don’t want to live next door to.  

Make sure it’s still for sale (ie. check open times and call if in doubt) 

Check zoning – what affects the land, something underneath it, planning point of view. Land check, but there are free versions. You can also contact the council.  

Easements – and check nothing is built over an easement 

School zoning – well regarded public schools, you see people making sure that they’re buying within a zone. It’s difficult to forward plan with a school zone, boundaries can change, principals can change. You need to  be careful if you’re on the boarder. Could you save money buy purchasing where you want to live and sending your child to a private school? 

Overlays – what do they mean and how can you find out more? 

Orientation – is it problematic? 

Shape of the block – if it’s an odd shape there is wasted space that can’t be used in the yard. Where does the dwelling sit within the block – is it logical that maximises space or is it in an odd part in the block and wasted space.  

Comparable sales – if they are asking too much based on what other properties sold for, then just leave it. In a few weeks time, the price has probably come down.  

  1. What things should you be looking out for immediately when inspecting in person?

Take a video to get it captured so you can refer back later 

Movement cracks (new paint that hides cracking), smells, dampness (mould and water stains), water leaks (swollen timbers, movement cracking on the floor with tiles in bathrooms), bad neighbours, power poles and transformers, powerlines, bus stops, things that stop you parking (no standing, hydrants, crossovers etc) 

Trees too close to the building, worse if neighbours tree because you can’t do anything about it. If tree is too big and of a particular species, you can’t take it down 

Slope – development it increases cost, but could cause problems with pooling water against a wall.  

Take a walk around the block 

Audible things that might bother you; (air traffic, bus, train, traffic, schools, fire stations) 

Street parking – is it abundant? 

Does the street get busy at any particular time? Ie. schools, parking restrictions, functions at nearby centres, clearways etc. 

Anything you personally want to avoid being near (we all have our sensitivities)… it may be a church, graveyard, hostel, pub… make your list and be firm about it 

How many other people are going to the inspection – people in their 20’s with mums and dads, do they look like developers or tradies who are going to flip. You may only need 15 mins, but stay there for the full 30 mins and see who comes and goes.  

Stand around the agent and listen to the questions being asked. Find out a little bit about how the campaign could go, when offers could start getting fielded. Is there a chance the flood gates could open soon? 

  1. The ways to assess a ‘workable’ floorplan vs a complete overhaul floorplan

Look at the floorplan online 

If you’re looking at a property that you want to change – look at the wet areas and how they are grouped and how the house rolls out.  

If you’re looking at a terrace house, you often get kitchen and bathroom down at the very end. If you’ve got a property with the right floorplan without having to get new foundations, you’ve got a far more cost effective renovation and workable floorplan.  

In a great location, great street, but the floor plan is unworkable, but that’s why it fits into their floorplan. But they’re not factoring costs to re-arrange the floor plan.  

If that particular discount is enabling you to get into something that they’d be precluded from getting for quite some time, then it may be worth doing provided you can live with it for a long-time. A home buyer can take the time to get into the location that they want to get into, they’re happy buying a property that may be more run down, floor plan may not be perfect, but they plan to live there for 10+ years and gradually improve the property over time and over the years. Want to get the bigger block and the bigger property even if it’s a bit more run down. 

  1. Cosmetic work vs tradesperson work vs full planning permit

Be clear on what type of renovation that you’re going to be doing. 

Cosmetic – colours 

Tradies – have to have certificates of compliance or the work is beyond you. 

Planning permits – moving walls or adding rooms. 

Should I be seeing certificates of compliance in the contract of sale? Note this when you are looking at the property.  

Be confident about what you’re taking on – are you taking on liability from someone elses work that was done immediately. Or council telling you to pull it down or insurer not insuring you because of this.  

Solicitor should be on the look out, building and pest inspector should pick up some. What is the limitation for those professionals with the information that they have on hand. These are the ideas that I’ve got and the stuff I want to do.  

When you inspect the property, conveyancer and solicitor haven’t seen it. Try and find the past sales photo campaigns, they may still be on the internet. Overlay the previous floor plan – didn’t have deck, no shed out the back, point these out to the solicitor.  

Has it all been done above board.  

  1. What you can find out from council about the land/dwelling

Land – encumbrances – easements underneath, covenants, restrictions – can change the use of the land.  

Any neighbouring applications for renovations or developments – blocking light, 4 units sites being built 

BMT quantity surveyors – register and plug in an address and you’ll get a notification if any planning permits submitted within a certain radius.  

If I’m looking to buy long-term and lots of people are knocking down houses to build new ones – urban renewal, some up lift in price. Or is neighbour going to knock down their house and build dwellings. What’s happening in the area, or is it extensions.  

  1. Checklist helps

Make sure that you haven’t missed a single step, systemised crew 

Flood or fire cover – you can get a good indication from an online insurance quote, is it a low risk property or a high risk.  

It’s just a hint, not thorough research – indicator. Use AAMI as an example – if it’s considerably higher than normal, there is an indication that the insurer could have a problem with the location.  

Gold Nuggets

Cate Bakos – The Property Buyer’s Golden nugget: I’m going to keep to the theme, when a property does have a negative attribute, sometimes you can be ok with that – road noise, train noise. That’s ok, but you need to be thinking about the future resale value. If it’s the house of your dreams, then maybe you can let it go through to the keeper. But if you’re going to sell it sooner rather than later, you need to be thinking mainstream. Avoid a compromise unless it’s one that you’re comfortable with and you’re staying there for a long time. 

Peter Koulizos – The Property Professor’s Golden nugget: encourage all buyers to do their due diligence. Hate to think that you are doing so much that you suffer from analysis paralysis. Because you always find something wrong with the property. There is no perfect property. Two extremes, look at the proeprty 30 mins before the auction and start building. 15 years after done a course with me and they still haven’t bought. Waiting for ducks to get into a row, waiting for market to bottom out. The key point is location, you can never change that. If it needs cosmetic, you can do that. But you cannot change where it’s located. Make sure you’ve got that right, then a lot of these other things can be fixed up.

Market Updates

  1. How do rents stack up against inflation

Peter shares his research on rental returns over the last 10 years, which increased nationally by 11% for all dwellings. Compared with inflation, which increased by 25.6%, it’s a good reminder of the benefits of capital growth focused investment properties. Check out our show notes for the growth rates of rents for each capital city.

2012 to 2022 – inflation 25.6% 

Nationally rents only have gone up 11% 

  • Melbourne: 13% 
  • Sydney: 13% 
  • Brisbane: 12% 
  • Adelaide: 17% 
  • Perth: – 3% 
  • Hobart: 38% 
  • Darwin: – 6% 
  • Canberra: 16% 
  1. Closing in on the neutral cash rate

Whilst opinions on where the neutral cash rate sits are many and varied, Cate reminds our listeners that we must be getting pretty close. Although economists don’t have a crystal ball, no one is expecting the cash rate to reach 5% and the RBA is trying to reach the point of equilibrium quickly. Once the RBA slows down on rate movements, it’s like that buyers and particularly those who have put their purchasing plans on hold to wait out the uncertainty, will jump back into the fray.  Nothing encourages opportunistic buyers like a slow-down in rate increases. 

  1. Economists revise down their predictions on the neutral cash rate

David shares the early signs of economic inflection which could suggest that the neutral cash rate is may likely eventuate at 2-2.5%. As little as two months ago, money markets were predicting the cash rate would reach as high as 4.5%, however most bank economists now think that it will rise to 3%, with CBA being the most conservative at 2.6%. Money markets have also spiked in July by 5-6%, which brings positive news. Whilst the US is in a technical recession, an argument could be made that they are not actually in a recession due to the very low unemployment rate and other factors. It is also important to note that our technical definition of what constitutes a recession varies from that of the US. 

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