The Good Life
Sheryn shares the master checklist that will help you find your dream block.
How to buy the block of your dreams
Buying a block has big financial and life consequences. Over the years, I have bought almost a dozen properties and learned something new each time.
Buying rural is different from residential and each situation can present unique challenges. There are a few things I know now that I wished I’d known when I bought my first one.
Tick the basic boxes
I must be a real estate agent’s dream. I can walk in and walk out of a property in 10 minutes and decide whether I am interested in buying it or not. You can call this ‘gut feeling’ but it’s more good research and preparation.
Before looking for a property, I have a basic checklist: location price size intended use and factors needed for that use
I have my ideal property in my imagination. All I am looking for is the reality.
There are factors I will compromise on, and others I won’t. Ask my husband. I don’t compromise much.
This means when I walk into a property it either ticks enough of the right boxes to become a serious contender, or it doesn’t. Explaining it as ‘going with my gut feeling’ is an easier way to describe it.
Be prepared
Before you start looking, be ready to buy. Know how you are going to finance it. Talk to your bank, other banks, and mortgage brokers to work out the best deal.
Bare land can be a big challenge. Many banks will require deposits of 20-50 percent, depending on where it is and your financial situation.
You are a customer of the bank. You are paying them very handsomely for their money and a lot is negotiable. Don’t be afraid to ask.
Bank after bank made it complicated and costly when we wanted to build our own home until an intelligent manager said they would simply lend on the land. We could use our cash to build.
Future use
Why do you want to live rurally? Will those reasons change in future?
Living in the country is great for young kids. But they soon turn into teenagers who want to see friends and join clubs and sports teams. Is the commute viable? What if children are heading to tech or uni in a few years?
If you’re over 50 – I hate to tell you this – you may not want to be carrying heavy loads up those rolling hills you love now when you reach 60.
The key to a great block is finding one that will suit your current needs and your future dreams. The dreams will probably change and evolve, but if it is at the back of your mind that you would like to semiretire and grow flowers to sell at the gate, take that into consideration now. It is a lot easier than having to start again on a new block in a few years.
Make it pay
I strongly encourage every block owner to use their land to make or supplement their income.
If you are relying on this income to pay the mortgage, you’ll need a very good business plan and capital. New start-ups and horticulture ventures require large amounts of initial investment and are high-risk.
Your desired activity will need to match up with the land’s contour, soil, climate, water supply, access to market, covenants, and zoning.
If you’re over 50, you may not want to be carrying heavy loads up rolling hills when you’re over 60.
Location, location, location
When searching for a block, the very nice real estate agents you’ll meet are not working for you. They are contracted to work for the seller, make a sale and get the best possible price (and their commission). It is up to you to ask the right questions.
Don’t compromise on the important things. Location, contour, size, and climate are inflexible. Access and water supply are also essential. Do these work in with your intended use?
It is very common to underestimate the area required for stock. If you want to raise a couple of cattle for the freezer, or have a pony for the kids, you need at least a hectare of good grazing land.
But many blocks are cut off larger farms because they are less productive, meaning you may need more land or less livestock.
Soil, shelter, weeds, fencing, power, sheds and a house can be altered, added to or repaired. They always cost a lot more than you think. A lot more.
Don’t underestimate the effort involved either. Are you prepared to put in the hours, days, weeks required, on top of the extra work that’s involved running a lifestyle block, plus your ‘real’ job?
Talk to your lawyer
Everything is negotiable, including your lawyer’s fee.
For routine house purchases in my hometown, with a standard sale and purchase agreement, I used a lawyer with a fixed price who agreed to give me a discount. Transactions were quick, done via the internet. I have never met her.
For more involved land purchases, I have paid for the advice of an experienced local lawyer who can answer my questions faceto-face and offer advice. This has always been worth the extra dollars.
Ask what the fees will be and what they will cover. For instance, I was once charged search fees on the chattels. This comprised a very old oven, which we dumped. I was not pleased, and now know to discuss my expectations and their fees up front.
You are paying lawyers for professional advice. Get it.