The right pre-purchase building inspection can save you thousands of dollars by exposing expensive problems.
When you're looking to buy a property, thorough property inspections and reports carried out by qualified professionals can be expensive. But before you consider cutting corners, it's worth considering how much more it could cost you in the long run. Veteran buyer's agent Tod Peterson explains:
There’s been some talk in the industry about the subject of agents recommending building and pest inspectors, where the reports have not been done professionally with defects and building issues being missed. Tod Peterson explains.
Evidently it’s been happening quite a bit in capital cities and regional areas, where certain inspection companies are referred by real estate agents, because the agents know that these companies will do a quick report without discovering too much wrong with the property.
It can’t be stressed enough that it is imperative that these reports are done by professionals with a proven track record. If not, you’re just throwing money down the drain. And it’s your legal right to have a professional building and pest inspection done on the property you’re intending to purchase. This helps your buyer’s agent too, because they are then able to leverage off this and use it as a negotiating tool to reduce the price of the property. It ensures that you won’t be forking out thousands of dollars in correcting building defects you discover months after you move in!
Some time ago, a client of mine was about to purchase a two by three bedroom apartment in a relatively new complex in Darwin’s CBD. I suggested we get some reports done, but because the developer owned the units, my client felt that getting a swag of reports done was a bit of overkill and not really warranted. Not long after her purchase, she discovered to her absolute horror that the electrical and water services in the unit… wait for it… were not connected up! So needless to say, a fair amount of cost was involved in getting that issue rectified.
Another client of mine was about to purchase a house in Rapid Creek, a lovely seaside area in Darwin’s northern suburbs. It was an old house, tenanted, and the owner of the property lived interstate. Again, the client declined on getting inspections done. He thought it was a bit of overplay because the house was old and he was going to renovate it anyway. But he erred on the side of caution and decided to get the reports completed. A good thing too, because the inspections revealed not only a leaking pool, which would have cost $15,000 to get relined, but also a massive termite infestation! Had he not had the reports done, just to rectify these two issues alone would have set him back $55,000! And as the report turned up a few more expensive building issues, I was able to leverage the purchase price down and saved my client a whopping $85,000 off the sale price.
So the proof is in the pudding (sorry, for the pun, but Christmas is nearly here). Do get the inspection reports done. Yes, it’s time consuming and tedious, but it will save you an absolute truckload of money in the long run, and if any problems are discovered, your buyer’s agent can use it as a bargaining tool to negotiate a great purchase price for you. And, more importantly, getting the reports completed allows you peace of mind.
What do you think? Have you ever had a less-than-stellar property inspection done on one of your properties? Share your experience by posting a comment below.
- Tod Peterson is the director for Peterson's Property Search, a leading buyer's agent service that caters exclusively for property buyers in the Northern Territory.
- Tod has over 28 years of industry experience and works with residential, commercial, rural and development markets