That Home Loan Hub
Welcome to That Home Loan Hub, your ultimate guide to mastering the world of home loans and property. I'm Zebunisso Alimova, here to simplify the complexities of real estate and provide you with expert insights and the latest trends.
Whether you're a first-time homebuyer, an experienced investor, or simply curious about the property market, this podcast is for you. Join me each week as we unlock the secrets to property success and help you make informed decisions. Let's dive into the world of property together!
That Home Loan Hub
Should You Buy A Home Privately? Clear Pros, Hidden Risks, And Smarter Steps
Hate open homes and bidding wars? We take a clear-eyed look at private home purchases and map out when they shine and when they sting. From tenant-to-owner deals to family sales and investor shortcuts, we unpack the real-world pros, the bank rules that matter, and the due diligence that keeps your budget and sanity intact.
We start with the upside: less competition, first access, and the unbeatable win of not packing boxes when you already live in the property. Then we add the guardrails. Banks often require a registered valuation for private sales, even with 20% deposit, because there’s no market-tested price. That’s your cue to ground decisions in evidence rather than emotion. We walk through what a valuation can and can’t tell you, why a builder’s report and a LIM report are non-negotiable, and how small issues you learned to live with can become big problems at sale time.
Emotions run hottest with family and friend transactions. We share cautionary stories about buying at the peak to “keep the house,” only to face losses later, and outline the boundaries that protect relationships: independent valuations, standard clauses, and separate legal advice. Investors also get a reality check: a private deal is not a substitute for a rent appraisal, capex plan, and compliance review. If the numbers only work under perfect assumptions, they don’t work.
By the end, you’ll know how to judge long-term fit versus short-term convenience, where hidden costs hide, and when to call in a professional. Subscribe, share with a friend who’s eyeing a private deal, and leave a quick review to tell us the one check you’d never skip.
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Hello and welcome back to that Humlon Hub. I've got Kunj today and we're going to talk about private stuff. Hello, Kunj.
SPEAKER_00:Kilda, how are you?
SPEAKER_01:Good thanks. Kunj, what is private stuff we're going to talk about?
SPEAKER_00:Private stuff. Okay. Um, is buying privately a good idea? Is what I thought we'll um cover off on this episode.
SPEAKER_01:Is buying privately a good idea? And this episode is a thanks to one of our listeners that sent us this question. Buying private. Do you think it's a good idea? It has its pros and cons.
SPEAKER_00:Let's talk about pros. So the pro of going private is um obviously you don't need to uh compete with a lot more buyers because it's privately, it could be through a family, a friend, a colleague or something that's private. So less competition, I think, is one of the pros there. Well, there's no competition. Yeah. You're just you're buying it. Yeah, you're buying it sort of thing. So yeah, if you've come up with a private agreement with this person and they're like, yes, I'll sell you my house, then yeah, there's no competition.
SPEAKER_01:And usually we see those cases when it's a tenant buying off the landlord. Yes. So you already live in that house, you know the property, you know all the you know, the good things about the property and the bad things about the property, usually. And the landlord might want to sell it, and this is your opportunity to go first before they put it on the market.
SPEAKER_00:Yeah.
SPEAKER_01:So the pros is um you get first dips and you already know about the property.
SPEAKER_00:Yeah. Well, you and you don't have to move. Oh, that's like a massive pro. No, no packing your boxes. No packing boxes. Awesome.
SPEAKER_01:So um, so those are our three pros. Let's talk about cons. What could be the con?
SPEAKER_00:Um, the cons, well, and I guess the bank's view, um, some actually require you to get a registered valuation. However, you need a registered valuation anyway if you're um purchasing with less than 20% deposit.
SPEAKER_01:Yep. So if you don't have 20% deposit, the bank will always require you to have valuation. But in private sales, even if you have 20% deposit, the bank will require valuation. So you just have to watch out for that. Um, the other thing is sometimes people get too emotional, they might offer too much.
SPEAKER_00:Yes, yes. Hence why um a registered valuation is recommended when you're buying privately to ensure that you're not overpaying or underpaying for that property. Awesome. And what else do you think could be a con?
SPEAKER_01:I think I think again, buying emotionally. Because you're buying because you don't want to move. But is that the best property for you? Is that the best property for your family?
SPEAKER_00:Yeah.
SPEAKER_01:Yes, right now maybe it's convenient for, you know, it's you've got a good kindie nearby or you've got um various groups, but is it good long term for you in terms of schools and colleges and jobs, etc. etc. So um so you gotta look at it from uh sometimes unemotional point of view, yeah, and think if you buy this property, how long are you gonna stay in it for? Is it gonna be the next one year or is it gonna be the next five to ten years? You know, you've got to think about um the property material as well, like how much renovation it needs if you've been already living in it. Um, but also sometimes people buy privately off the family members. Yeah. And again, that could be not the best decision just because you want to save the house, if it's like a family house and it means a lot to you, you know, but it might you might end up losing money on it. Yeah. And we have clients like that in the past that bought off the family to keep it, but then you know, you they would have bought at the peak of the market and now they can't sell it, or they have to lose money.
SPEAKER_00:Yeah, yeah. And uh and also um when you sell later on, you um don't think about the costs of selling the property. Yes. Yeah, so when you're buying it privately, the you know, costs of buying private, obviously, commission or like real estate agents commission isn't factored in. But then if you had to relist that um again down the future and selling it, then you've got and you're gonna go, you know, on the market with an agent, then you've got that cost to factor in and you hadn't done that prior. So just something to be mindful of.
SPEAKER_01:And I just keep thinking about like when you're buying privately, you may overlook all the issues. You might not think there are big issues to you because you already sort of made your peace with that. But yeah, be prepared if you are gonna put it on the market, you know, and if there are certain issues with the house, it might become a bigger issue than what you think it is.
SPEAKER_00:I think buying privately, you still have to do your due diligence. So you've still got to um, I still recommend to do that builder report, um, get that limb report because you've been renting it for how many years, let's say it's a renter buying off um their landlord, you're renting it for how many years and you never even it never even crossed your mind to get those reports done because you're kind of like, well, I've lived here for so long, this is the norm sort of thing. But if you have to sell it in future and there are issues with the limb report or the builders report, that's gonna cause you nightmares down the track.
SPEAKER_01:Exactly, exactly. So, yeah, make sure you do your due diligence, even if it's a private sale, especially if it's a private sale. 100%. Um, don't and look, you might buy in a private sale as well to have an investment property. Like you might have a friend selling their rental, and you might jump on that rental. And again, I've seen this happen um earlier this year. I had clients buy off their friend as an investment property not to live in. And yeah, it was now they've discovered all these different issues with the property, and they've sunk a lot of money into that property. And part of them is like, oh, you know, we wish we didn't buy it through this private sale and we did our due diligence properly. Yeah, so yeah, definitely don't try to be a good guy to your friend and doing business with friends. And doing business with friends, love it. Awesome, guys. Thank you so much for listening. And look, um, we appreciate when you do send us your questions in. And um, if you do have anything that you want us to cover, feel free to send it through to us and we will do a topic. So, just a quick recap private sale, should you do it or not? Uh, pros and cons, but as usual, be be diligent in what you're doing. Yeah, and um and if in doubt, ask a professional. Thank you. Thank you, bye.
