Access to property due diligence in Brisbane has become more freely available now that the internet age is upon us. But despite this accessibility, many property buyers fail to complete the necessary checks before committing to a purchase.
In this article, I outline 9 essential property due diligence checks that every buyer should complete before purchasing a home or investment property. These steps help reveal the “invisible” factors about a property and its surrounding neighbourhood. For professional support through every stage of the buying process, explore our buyers agent services in Brisbane.
What Is Property Due Diligence When Buying a Property?
Property due diligence is the process of researching and verifying key information about a property before purchase. It helps identify potential risks, defects, or hidden costs that could affect the value or suitability of a home or investment property.
Quick Summary: Your Property Due Diligence Checklist
- Inspect the property and neighbourhood
- Check surrounding housing density and future development
- Research suburb demographics
- Verify building certifications and renovations
- Review body corporate or owners corporation documents
- Check flood, fire, and environmental risks
- Locate underground services
- Confirm school catchment zones
- Review historical capital growth trends
1. Inspect the Property and Neighbourhood Thoroughly
Understanding Physical Property Due Diligence
I always fail to understand how some buyers, predominantly investors, are comfortable buying a property sight unseen. For some people, that may come as a surprise but believe me, it happens. There is so much you learn about a property through a physical inspection and by conducting proper property due diligence in Brisbane, supported further by a drive around the local neighbourhood.
You simply cannot rely on images provided by a sales agent on a real estate listing to tell the full story. An on-site inspection is a must for a thorough property due diligence process. With the guidance of a home buyers advocate, you can identify issues that may not be visible at first glance. What you cannot see in listing photos is the streetscape, the quality of adjoining homes, and any potential noise impact from nearby transport corridors, local industry, or even the neighbours themselves.
Furthermore, seeing a property with your own eyes rather than through a wide frame lens often gives a more realistic expectation of room sizes, layout, and build quality. You may have already experienced this while searching for a property. I am sure there have been times when you realised a property looked much better in the listing photos than it did in real life.
During an inspection you can also identify potential maintenance issues such as broken door hinges, tap leaks, or loose handles. While these things may be found in a building and pest inspection, which you will pay for, it is often better to have a clear picture of how well the property has been maintained before you commit financially or emotionally to a purchase.
2. Check Surrounding Housing Density and Development Plans
Why Housing Density Matters for Property Due Diligence
There may be nothing more heartbreaking for a property buyer than finding out too late that they will be negatively impacted by future medium or higher density development. This happened to someone I met recently who had not fully understood the property due diligence required before buying.
During the construction phase of a small townhouse project I was managing for clients, I reached out to the adjoining neighbour to discuss the dividing fence. This neighbour had moved into their dream home only a couple of weeks before we commenced demolition next door, and we were replacing one house with three townhouses.
Unfortunately, the new home buyer had not completed any due diligence checks to discover she would be living beside townhouses. She assumed because there was a single house on the site that it would always be a house. A simple search for nearby approved developments as part of your Brisbane property due diligence would have uncovered this information and saved her that heartache. She told me she would never have purchased the home if she had known she would have three adjoining neighbours instead of one.
Even if there are no approved developments nearby, it is useful to check the capacity of the land for potential future development. It may not be approved now, but if the council planning scheme allows higher density in the surrounding area, it is better to know before you buy so you understand what the neighbourhood might look like in the future.
3. Research the Suburb Demographic Profile
Using Suburb Data for Brisbane Property Due Diligence
There are simple ways to check who your neighbours are likely to be before buying a property. Suburb profile data is readily available online, and you can easily determine whether an area is made up predominantly of owner-occupiers or renters. The general spread across many areas is approximately 70 percent owner-occupiers and 30 percent investors. If you are a home buyer, you may prefer to live among other homeowners. If you are an investor, it may be important to invest in an area that is not already saturated with investors.
You can also get a snapshot of income levels and household-related data such as whether the predominant population group is singles, couples without children, young families, established families, or older couples. Collecting this information is an important part of your property due diligence checks, and it gives a broad understanding of an area before you commit significant funds to a purchase.
4. Verify Building Certifications and Renovation Approvals
Building and Renovation Due Diligence Checks
Many homes for sale have at some stage been renovated or extended, or had additions like a carport or deck added. It is important for a buyer to confirm whether these improvements were certified. Usually, any extension or modification that requires Building Approval will need a final certificate to verify the works were completed in accordance with the Building Code. Approved building plans should also be available. As a buyer, you have a right to ask for this information, and the seller should be able to supply it if the works were completed correctly.
If you cannot verify the approvals, you must understand that the improvements may not comply with the Building Code, and as the property buyer you would take on any associated risks. Additionally, if the works were completed within the last 6.5 years, they may still be covered by Home Building or Home Warranty Insurance. Asking for verification as part of your property due diligence process can help you decide whether the property is worth pursuing.
5. Review Body Corporate or Owners Corporation Records
Understanding Strata and Shared Ownership Due Diligence
Buyers considering a property governed by an owners corporation or body corporate should always understand the contribution and sinking fund costs. As part of a comprehensive property due diligence process, I strongly advise requesting a copy of the most recent owners corporation or body corporate meeting minutes.
You might be surprised to discover high cost maintenance items that have been reported but not yet completed. Once you become the owner, the liability to contribute to those costs becomes yours. This is one check that could save you a lot of headaches down the track.
6. Check for Environmental and Natural Risk Factors
Flood, Fire, and Noise Overlays in Brisbane Property Due Diligence
There are many adverse risk factors that can negatively affect a property and its value or holding costs. If you do not check for these things, you may only discover them after you buy.
Flood risk is obvious in areas near rivers or creeks. In a significant rain event, rivers can break their banks and creeks can swell into residential areas. Other types of flood impact, such as storm surge or overland flow, should also be checked.
There are other risks too, including bushfire hazard, noise overlays, and environmental impacts, all of which will influence how you assess a property during the due diligence process.
7. Locate Underground Services Before You Buy
Why Utilities Matter in Property Due Diligence
This is often overlooked. Underground services including water, sewer, and stormwater pipes may lie beneath a property, and the only way to know is to complete an underground services search on a platform such as Dial Before You Dig.
For some buyers, discovering these assets may not affect planned use of the home. For others, especially those planning to dig a pool, renovate, or redevelop, the existence of underground services can be a deal breaker. Including this check in your property due diligence checklist can prevent costly surprises.
8. Confirm Local School Catchment Zones
Education-Related Property Due Diligence for Families
Many people buy in an area because of the local school they plan to send their children to. Some schools have enrollment management programs, so if you fall just outside the catchment zone you may not secure a place for your children. It is important to understand that school catchment zones do not always align with suburb boundaries, so you must double-check them during your property due diligence to ensure the property you are considering falls in the catchment you desire.
9. Review Historical Capital Growth and Investment Potential
Using Capital Growth Data for Property Investment Due Diligence
Although for many people the only property they buy is their family home, understanding how that asset can build a future nest egg is valuable for ensuring a more comfortable retirement. As professional investment property buyers agents, we can never project with certainty how a property’s value will increase, but we can review historical data to get a clearer idea of where a suburb’s value has been headed.
I always encourage people to take a ten year view. What happened over the recent three to five years may not reflect longer term trends. Property markets move in cycles and over the past century in Australia the general trend has been upward. Some markets will perform better than others over the long term, so this step is important if building long-term wealth is your goal.
Final Thoughts: Follow These Property Due Diligence Steps for Success
Spending time at the start of your property search to understand what you are really buying will pay off over the long term. Most people may only ever buy one or two properties in a lifetime. You do not want the experience to ruin your future.
Transactional costs in property are high, so mistakes can be costly. The first step is learning what you may not have considered, followed by performing the necessary property due diligence checks to avoid expensive errors. If you are unsure about any part of the process, take the time to find out and seek advice before committing.
If you need professional assistance, get in touch with our experienced buyers agents in Brisbane. Our team helps clients avoid costly mistakes and buy with ease.
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