Buying a property is often one of the biggest financial decisions a person may make in their lifetime. A pest and building report is therefore an extremely important part of the due diligence process so a buyer understands exactly what they are agreeing to purchase.
A pest and building report usually costs approximately $500.00 and involves a qualified inspector conducting a detailed review of the state and condition of the property. It can be arranged by a purchaser themselves or a solicitor or conveyancer can arrange on their behalf. A pest and building report provides a clear and detailed outline of any significant building defects, issues such as rising damp, movement in the walls, existence of termites, safety hazards and a range of other more minor issues.
We strongly recommend that a pest and building report be carried out prior to an unconditional exchange of contracts or if a contract is exchanged subject to a cooling off period then within that period where the contract can be rescinded with only a small holding deposit being forfeited. When you enter into a contract to purchase a property, the vendor usually makes no warranties as to the state and condition of the property, which places the responsibility on the purchaser to make their own enquiries and be satisfied themselves as to its condition. There are usually no rights for a purchaser to bring a contract to an end if a they unveil building or infestation issues following an unconditional exchange of contracts. Instead it would be the purchaser's responsibility and at their own expense to rectify any such problems.
If a pest and building report uncovers significant issues that were not known at the time of placing an offer, it can be used to negotiate a lower price if the contract has not yet been entered into. Alternatively, a purchaser can request from the vendor that certain issues be rectified at the property at the vendor's cost prior to settlement. Therefore whilst an additional outlay for such a report may seem expensive during a time where costs savings are important, these reports have the potential to result in larger possible savings down the track. If a report does not recover any major issues, at the least it will provide a purchaser with peace of mind that the property is of a sound quality.
Ultimately a pest and building inspection will allow a purchaser to understand the existing defects at a property, the potential risks and the likely costs of such problems which enables one to make an informed decision as to whether to proceed with the purchase.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
