Buying by Private Treaty
Private treaty sales take place either through a real estate agent or directly through the owner. The key for those buying by private treaty is to try and establish the lowest possible price the vendor is willing to accept. Keep in mind that most houses up for sale have some built-in buffer for negotiation. 

When negotiating through an agent, keep in mind that they are working in the interests of the vendor. Some strategies for successful buying by private treaty include:

Befriending the agent: Establishing a good relationship with real estate agents in the area you are interested in is a good idea. You want agents to know that you are a serious potential buyer so that they let you know when a relevant property is on the market.

Getting an appraisal: This is the best way to judge whether the asking price is an accurate reflection of its true value is to call in a professional appraiser. Although you will have to pay for the service, it will give you good bargaining power if you really want the property.

Keeping a close hand: As a buyer, your aim should be to express interest in the property without letting the agent or vendor know the maximum amount you would be willing to pay. The best strategy is to gradually increase your offer over time.

Stating your case: If the asking price is outside of your budget, try negotiating. For example, if a building inspection reveals that the roof needs replacing, suggest to the agent or vendor that this work will be costly and should be deducted.

Checking the facts: If a key selling point is that the property could be subdivided or added on to, ask to see planning permission from the local council. As with any property purchase, you should do your research and get all relevant inspections done by a professional.

Not exceeding your budget: As a rule of thumb, remember that if you are prepared to buy a property at all costs, you could be financially overextended for a long period. It is wiser to buy a property you can afford so you can enjoy being a home owner.

If you make a successful offer to the vendor, you need to obtain written acknowledgement of this fact in the form of a contract to avoid being gazumped. The contract will set out the agreed price, as well as any terms and conditions that have been negotiated (such as any inclusions, the sale being subject to inspections or a short settlement period). You will also be required to pay a deposit (usually 10 per cent). The conveyancing process will then begin

To avoid being left out of pocket when purchasing a property, you have to factor in all relevant costs. These expenses, which may vary from state to state, will generally include Lender's Costs, Government Duties and Additional Costs. Your mortgage broker or lender can calculate the relevant Lender's Costs and Government Duties.
 

Lenders cost
Home loan application fee: The fee charged by your lender when a formal loan application is made.

Valuation fee: Your lender will usually request a property valuation for lending purposes, which may or may not be covered in the application fee.

Mortgage insurance: This insurance protects the lender and is required when the buyer is borrowing more than a set percentage of the property's value, as determined by the lender.

Survey report: This shows where the property is in relation to the boundaries of the land. Some lenders will request a survey report for their records.

Government duties
Property Stamp Duty: This amount is payable on the purchase price of the property and must be paid within three months of the date of exchanging contracts. Your mortgage broker or lender will let you know the amount relevant to all purchase prices.

Mortgage Stamp Duty: This amount is payable on the mortgage.

Mortgage Registration Fee: A small fee applies to register the mortgage and to register the transfer document.

Additional costs
Conveyancing fees: This may also include strata title searches and disbursements. Your conveyancer or solicitor should give you a written estimate before acting on your behalf.

Inspection fees: Building, pest and strata inspections all incur individual fees.

Home building insurance: This should be arranged prior to settlement and will be dependent on the age, size, location and type of construction of the property.

House and contents insurance: This should be arranged prior to moving into your new property so you are covered immediately.

Removalist costs: This will be dependent on how much and how far you have to move. Also factor in electricity, gas and phone connections.

If you are a first-home buyer, you may be entitled to the First Home Owner Grant. 

For an approximate price guide to all costs you can expect to pay, contact the Home Purchase Advisory Service on 1800 806 653.