What you can (and should) do in the cooling off period

So, you’ve found your ideal property, made your offer and had it accepted. Before you break out the champagne, it’s worth having a think about how you’re going to use the cooling off period to ensure you’re still celebrating when you finally get the keys in your hand.

For many buyers, they just use the cooling off period to get their finance formally approved before going unconditional, when in fact, there’s a whole lot more you can (and should) do in your cooling off period.

Here are the five things you can do during this period: 

Conduct a building and pest inspection (or get a second opinion)

In a hot market like the one we’re experiencing across the country, buyers are feeling under pressure.  

Prices are climbing, only a limited number of new properties are coming onto the market, and we’re still unsure as to when banks will increase their fixed rates. 

The end result is that many buyers are rushing in and making an offer without knowing exactly what they’re getting for their money.

If that’s you, then as soon as you’ve had your offer accepted, make sure you line up a building and pest inspection as early as possible. 

If you’ve already had an inspection done, but something in the report is keeping you up at night, now is the time to send someone in for a closer look. 

For example, your pest report may indicate signs of previous termite activity on the property. 

To play it safe, use the cooling off period to organise a more thorough termite inspection and be 100 per cent certain that there are no more active pests on the property. 

Get quotes for any work that needs to be done

Take your time to go through your building report during the cooling off period, particularly making note of any defects or urgent repairs recommended by the inspector. It can be tempting to turn a blind eye to any issues raised in the report. 

But as you’ll see in the next point, it really pays to get accurate quotes for any work that needs to be done on your property. 

If the guttering looks like it will need to be replaced soon, and the bathroom is showing signs of water damage, plus there’s a suspicious crack in the living room… send a builder in to give you an accurate estimate of the cost for repairs. 

Investing wisely is all about getting the numbers right. Sometimes it may be worth losing your holding deposit and backing out of the deal if the numbers don’t stack up.

Negotiate the final selling price

The good news is, there is always room for negotiation on the selling price up until the end of the cooling period, provided you have a fair reason. 

Perhaps you’ve realised that the water damage mentioned in the building report is a sign of a more serious problem, and your builder has estimated the work is going to cost $10,000 within the next few months. 

At this point, you may consider pulling out of the deal, or you can go back to the vendor and ask for a reduction in the selling price.

This approach may potentially be less effective in a seller’s market, but it’s always worth asking, as a motivated vendor may be willing to negotiate to lock in the sale and continue pushing towards settlement. 

Ask all the questions you didn’t have time for

During the cooling off period, make sure to take a breath and ask yourself some important questions:

• Have I considered issues like fire and flood risk?
• Has my solicitor found any potential concerns with the contract?
• What is the neighborhood really like around my property?
• Would I be better off backing out now and looking for a more suitable property?
• Is the property truly aligned with my long-term investment strategy?
• Is the rental estimate provided accurate?
• Do my numbers stack up in terms of generating the cash flow I need?

Answering these questions honestly will give you the peace of mind to know you’ve made a great purchase that will serve you well for years to come.

Extend your cooling off period

If any of the first four points raise some red flags for you, make sure to address them before the cooling off period ends.

If you’re running out of time to get the answers you need, it may still be possible to get your cooling off period extended.

Extending the cooling off period is completely at the vendor’s discretion, but they may be willing to be flexible, especially if you need another day or two to get your loan approved, or have identified a major issue that will most likely also be raised by any subsequent buyers. 

As you can see, the cooling off period can be one of the most important times when purchasing property.

Use it well, so when the sale goes unconditional, you’ll be feeling confident about your purchase, and finally ready to pop the cork on the champagne!