Whether you’re looking into buying your first home or you are a seasoned investor, there is one question that is always considered when deciding to purchase a property: Do I need to have a building and pest inspection done? To put it into perspective, you could ask yourself if you would buy a used car without taking it to a mechanic, or marry someone without asking about their credit history.
If you happen to be the kind of person who likes to take risks, don’t! You should always plan to get a building and pest inspection done when buying a new property. Ideally, these inspections should be completed before exchanging a contract, agreeing to a final sale price, or before the cooling-off period expires, depending on the laws in your state.
To gain a better understanding of the reports, let’s look at the common reasons why people choose to go through with the inspections, and why some people decide not to.
Why people get building and pest inspection reports: The pros
You will rarely come across a buyer who has decided to forego the standard property report or pest inspection. The reason for this is because of the mental and financial relief that the information can provide during such a significant decision. For example:
- It allows you to negotiate – If the building is found to be in less-than-satisfactory condition, you then have the chance to return to the seller with new requirements for the contract. This could mean a lower sale price or terms to include that all repairs must be made prior to the closing date or final inspection.
- They can save you money on unseen repairs – As you do a walk-through of a potential property, you may be adding the cost to make the minor repairs that you can see. However, professional building and pest inspectors will check for unseen damage, such as cracks or structural damage. These are costs that you would be unaware of without a thorough examination. This is especially important as a house ages when you consider building materials or termite infestation damage.
- It will help you understand the state of the property before you commit – Buying a property comes with some uncertainty in regards to the previous owners. Every buyer hopes that the seller has been truthful and has taken care of the property. Unfortunately, this isn’t always the case. By obtaining a building and pest inspection, you will gain answers and put your mind at ease, regardless of the condition of the home. When making such a substantial commitment, you want to know what you are walking into so that you can make an informed decision.
Even for those who initially question having an inspection done, once the process is complete, you’ll never think twice about including it in every future home purchase that you make.
Why some people consider buying without a building or pest inspection: The cons
Your mortgage broker, conveyancer, real estate agent, and family should all recommend completing a pre-purchase inspection. However, the choice to have them done is ultimately up to you. While there aren’t many disadvantages to the inspections, let’s look at some of the concerns people have regarding them.
- It’s an added expense – When purchasing a home, the small costs seem to continue to grow. To cut back on some of the increasing expenses, a purchaser may choose to skip having the report done on a house that they believe to be in good condition – particularly when it’s not guaranteed that they will be the successful purchaser. However, when you are considering an investment worth hundreds of thousands of dollars, the outcome of the inspections will be well worth the cost.
- There are time constraints – If the building and pest inspections need to be completed before a set date, for example, the end of the cooling-off period, then a buyer may feel pressed for time to make their final decision. Because of scheduling and availability, if a person is rushing to get everything in order, they may think that they simply don’t have time. This could end up backfiring as most states, such as Victoria, still abide by the ‘Buyer Beware’ principle. Meaning the buyer has no recourse should there be issues with the property after purchase.
Even with the minimal downsides to consider, having the peace of mind that building and pest inspections offer is often enough to dispel any concerns.
When buying under auction
Because auctioned properties are sold in an “as is” condition, having a building and pest inspection done is critical. There is no cooling-off period with a purchase in an auction, so you will need to request to have the inspection reports done before the day of the auction if you plan to be successful with your bid.
Protect you and your investment
Ultimately, the building and pest inspections are done to protect you, the buyer, before accepting the responsibility of the home. It’s important to remember that the current owner is not legally required to inform a potential buyer of any faults. Protect yourself and your investment by doing your due diligence ahead of time.
Buying and need to sell?
Another different but complementary way to remove risk in your buying journey where you need to sell before or soon after buying is to obtain a Market Price Guarantee from Brickfloor. A Market Price Guarantee is an upfront commitment to buy your home for a market price – locked in before you run your sale campaign. This means that you can confidently move forward on your next home. Speak to Brickfloor today about a Market Price Guarantee.
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